Green Product Development Performance

Version	Summary	Created by	Modification	Content Size	Created at	Operation
1		Luan Trong Nguyen	--	2092	2022-05-20 15:05:57	\|
2	rearrange the reference	Dean Liu	Meta information modification	2092	2022-05-24 04:11:13	\| \|
3	format correction	Dean Liu	-7 word(s)	2085	2022-05-27 09:41:54	\|

This entry is adapted from the peer-reviewed paper 10.3390/economies10050113

Climate change and environmental crises are currently affecting the living environment of both people and the planet in general. This necessitates businesses to have a prompt and effective response to minimize or improve the harmful effects that lead to environmental imbalance and fulfill corporate social responsibility through focusing on transitioning to a model of sustainable economic development and encouraging the development and production of green products.

green product development performance green creativity green dynamic capabilities

1. Introduction

Adverse consequences from negative impacts on the environment have become a major global concern as a result of industrial development and evolution. In Vietnam, human-caused activities including the emission and discharge of untreated waste from industrial parks, mines, and traditional craft villages cause heavy environmental pollution (Chu 2018). In addition, traffic, agriculture, and deforestation also contribute to pollution in urban, rural, and forested areas. These issues have ramifications not only for the environment’s sustainability but also endanger human health (Raza et al. 2022). Therefore, environmental degradation is always a difficult topic and attracts people’s attention (Choi 2020; Oh and Park 2020; Nguyen et al. 2021). As environmental issues are being clearly perceived by the public, green products are also gaining attention and acceptance (Chen 2010). According to Chen and Chang (2012), many consumers pay more attention to green products. Many companies are willing to develop more green products (Chen 2011) since it can help companies and economies thrive in the international market, bring value and drive towards sustainable development of the environment. Moreover, the creation of green products is very important for businesses to respond appropriately to the environmental crisis (Albino et al. 2009), which is also the social responsibility of businesses. Consumers are smart enough to recognize and resist companies whose actions destroy their environment.

Researchers will develop a research framework that can help companies improve their green product development performance through five related determinants: green creativity, green dynamic capabilities, green transformational leadership, reactive green innovation, and proactive green innovation. Success in green product development depends on creating products with core attributes that can satisfy the needs of customers and other internal and external stakeholders. Product development firms will contribute little to the sustainability mission unless they can provide consumers with a realistic “green” product option (Pujari et al. 2003). Green product development also plays an important role in determining the sales of green products of a business and this development process not only changes the company management model but also reshapes the global market principles for business (Lymperopoulos et al. 2012). Furthermore, since the goal of sustainability is eliminating hunger, reducing poverty, and improving people’s spiritual and material lives, this will be difficult if the country does not generate income that contributes to the economy (Costa et al. 2021). It is an obvious fact that the majority of consumers of green products are the driving force for enterprises to research and develop green products. In addition, this study was conducted in Vietnam, where the economy is in a developing stage, with the aim of providing clear directions for countries in the development stage toward economic integration, society, the environment and fulfilling social responsibilities. Business sustainability can be defined as attaining environmental goals while maintaining long-term company growth. Innovative practices in business operation and development are essential for economic sustainability. New improvements in the production process and efficient development of green products will bring a number of benefits, including promoting the nation’s ecosystem (Costa et al. 2021). According to the results of previous studies, businesses in the next stage of sustainable management should focus on green transformation, minimize harmful emissions to the environment and human health, and actively find measures for green space development and sustainability (Hoffman 2018). Therefore, according to the experimental results, this study tries to fill the gaps of previous studies by analyzing and identifying the factors green creativity, green dynamic capabilities, green transformational leadership, reactive green innovation, and proactive green innovation. All hypotheses are accepted and they all have a positive impact on the performance of green product development, providing strategies that companies need to improve, the most powerful of which is green transformation leadership. Furthermore, this study is a useful document for Vietnamese firms that want to elevate the value of green products to an international level in order to make tangible contributions to the global community, decrease negative impacts from exploitation and manufacturing activities, and supply the current and future demand for green products.

2. Green Creativity

‘Green Creativity’ is defined as the development of new ideas with new useful characteristics for green products, services and practices (Song and Yu 2018). Organizational creativity is accomplished by the creation of an idea, product, or service of useful value by individuals working together within an organizational system (Woodman et al. 1993). To improve the development efficiency of enterprises, promoting solutions to develop organizational creativity is the main way to bring about innovation (Halbesleben et al. 2003). Organizations that accumulate innovative ideas can develop better and superior product performance (Hunt and Morgan 1995). The success of new product development will be significantly influenced by innovative ideas (Cooper 1979). The creativity of the team can create the conditions for the development of new products with new characteristics since usefulness is decisive for the success of the new product (Chang et al. 2010). Previous literature suggested that group creativity can be defined as the creativity developed by group members (Pirola-Merlo and Mann 2004). From the customer’s point of view, an innovative idea is considered by its originality and measured by how useful it is to the customer (Ford 1996). In addition, consumer needs can be effectively met by the unique, outstanding innovation of the product development and improvement team (Cooper 1979; Deshpande’ et al. 1993). For organizations and enterprises, group creativity is considered the main factor of innovation (Yoon et al. 2010). Therefore, research carried out by (Cooper 1979; Smith and Reinertsen 1992; Amabile et al. 1996; Griffin 1997) has shown that product development performance is positively influenced by creativity in product development teams.

3. Green Dynamic Capabilities

Dynamic capability is defined as the process of using an organization’s resources, focusing on the process of setting up or rearranging internal and external processes and resources to accommodate changes in the organization environment (Teece et al. 1997). In addition, green dynamic capability is shown to be the ability of organizations and companies to integrate resources for the purpose of achieving sustainability and improving the green environment in their business activities (Rodrigo-Alarcón et al. 2018). According to Wohlgemuth and Wenzel (2016), in a competitive, complex and unstable business environment, dynamic capability will be a useful solution in improving the company’s competitiveness. To develop green product performance, businesses need to apply their dynamic capabilities through combining existing knowledge elements and acquiring new knowledge (Andriopoulos 2001). An organization with stronger dynamic capabilities will be able to improve and develop better product performance (Arora 2002). Therefore, dynamic capabilities have a significant positive effect on product development performance (Hsu and Fang 2009). Innovation requires finding new sources of information different from the existing knowledge base in order to innovate, supplement and grow it, so organizations that embrace innovation will have to deal with a high degree of uncertainty, where dynamic capabilities are an important driver of innovation (March 1991; Lee and Kelley 2008). Organizational product development teams can rapidly develop new products that match and meet customer needs by applying dynamic capabilities to integrate resources and easily align operations development (Pavlou and El Sawy 2011). Thus, firms’ competitive advantages can affect innovation performance through dynamic capabilities (Galunic and Eisenhardt 2001). Therefore, dynamic capability will positively affect new product development performance (Clark and Fujimoto 1991; Iansiti and Clark 1994).

4. Green Transformational Leadership

Transformational leadership is a multidimensional concept that has meanings in terms of goals, culture, vision, structure, personal support, and performance expectations (Luyten and Bazo 2019). Previous literature has also widely demonstrated that transformational leadership has a direct influence on creating an innovative climate in the organization to create incentives for members to improve the operational efficiency of the business (Boehm et al. 2015; Pasha et al. 2017; Thomas 2017; Sethibe 2018). Robertson (2018) defined green transformational leadership as the behavior of leaders who motivate employees to achieve corporate environmental goals and inspire to exceed environmental performance expectations. Additionally, the meaning of green transformational leadership is to provide clarity, motivation to employees, and support for employees’ development needs towards their environmental goals for the organization (Mittal and Dhar 2016; Chen and Chang 2013). Studies have determined that the performance of companies is due to the interaction between leaders and their employees (Caplan 1987). Green transformational leadership motivates employees to acquire new knowledge (Le and Lei 2018; Han et al. 2016) and engages them interactively in activities related to green processes, product innovation, or introducing green products or services into the market (Andriopoulos and Lewis 2010). In addition, Bass (1985) suggested that transformational leaders should include four aspects: intellectual stimulation, individualized consideration, charisma, and inspirational motivation. Intellectual stimulation helps employees build cognitive processes appropriate to the creativity of problem formulation, information seeking, solution creation, and problem solving (Reiter-Palmon and Illies 2004). Research (Gong et al. 2009) suggests that transformational leaders can foster collective creativity through identifying individuals’ needs, and providing coaching and mentoring. For charismatic transformational leaders, they create a clear vision for the team, energize, and drive creative generation (Avolio et al. 1999). Finally, transformational leaders with a high level of motivation inspire their followers to think creatively by encouraging them to voice their ideas (Gong et al. 2009). Therefore, green transformational leadership can enhance new product development performance by setting expectations, stating a vision for high performance, motivating and inspiring team members with clear goals and supporting individuals in green product development activities (Podsakoff et al. 1990; Sarros et al. 2008).

5. Reactive Green Innovation

For the organization’s green product development activities, this is considered an important way for the company to connect with the market. Enterprises should spend money on development and product improvement strategies in order to stay ahead of their competitors in the business market (Ayag 2005). In addition, for green product development strategies, creating a product that can be produced at the lowest cost or innovating the product to make the product differentiated to meet the needs of consumer consumption are all methods that help businesses gain a significant competitive advantage (Orsato 2006). An organization or enterprise will face many disadvantages in competition and future business risks if it cannot effectively control the product development department (Fitzsimmons et al. 1991). From the above discussion, it can be considered in the field of environmental protection, to implement enterprise-wide environmental management in a proactive manner. Competitors will adjust and innovate so as not to be negatively affected by the adverse competitive environment.

6. Proactive Green Innovation

For businesses, product development is a potential way, it supports the image of businesses that are firmly established in the market and to create a competitive advantage compared to other competitors in a continuously changing market (Brown and Eisenhardt 1995). According to Benn et al. (2014), product development is the main source of competitive advantage of enterprises in the context of market diversity, so businesses must emphasize their brands in designing an outstanding organizational image in the market. Customer needs are met by seizing market opportunities in product development (Stark 2015). Enterprises develop green products to innovate and redesign products with the aim of minimizing environmental pollution problems, contributing to jointly dealing with environmental issues (Chen 2001). Besides, research (Cronin et al. 2011) has demonstrated that the development of environmentally friendly products and services is necessary. This is considered the key to helping businesses succeed in fulfilling the growing demand of customers for environmental protection products. Meanwhile, companies are striving to meet the needs of customers regarding the development of environmentally friendly products and services.

7. Green Product Development Performance

Chen and Chang (2013) gave the first definition of green product development performance as the ability to create products with a less negative impact on the environment and less harm to human health. It is part or whole made by using recycled materials, and produced in a more energy-efficient manner and supplied with less packaging to the market. Companies are still trying to figure out how to profit from green products, despite the fact that green development is becoming more common (Gabler et al. 2015). Furthermore, Chen et al. (2016) argue that creating green products with efficiency, as a new kind of business strategy, requires breaking the original production method. Research results from Chang (2016) show that corporate environmental commitment has a direct and indirect positive impact on green product innovation performance through green adaptability. Managers must recognize that providing green product development performance is critical to long-term sustainability and can provide a competitive advantage and strengthen an organization’s ability to grow sustainably.

The conceptual framework of this study is depicted in Figure 1.

Figure 1. Research framework.

References

Chu, Thi Thu Ha. 2018. Environmental pollution in Vietnam: Challenges in management and protection. Journal of Vietnamese Environment 9: 1–3.
Raza, Muhammad Haseeb, Muhammad Abid, Muhammad Faisal, Tingwu Yan, Shoaib Akhtar, and K. M. Mehedi Adnan. 2022. Environmental and Health Impacts of Crop Residue Burning: Scope of Sustainable Crop Residue Management Practices. International Journal of Environmental Research and Public Health 19: 4753.
Choi, Youngkeun. 2020. A study of the role of perceived organizational support among sexual harassment and employees’ attitudes. Journal of Asian Finance, Economics, and Business 7: 229–36.
Oh, Ah-Hyun, and Hye-Yoon Park. 2020. The effect of airline’s professional models on brand loyalty: Focusing on mediating effect of brand attitude. Journal of Asian Finance, Economics, and Business 7: 155–66.
Nguyen, Nhu Ty, Le Hoang Anh Nguyen, and Thanh Tuyen Tran. 2021. Purchase behavior of young consumers toward green packaged products in Vietnam. Journal of Asian Finance, Economics and Business 8: 985–96.
Chen, Yu-Shan. 2010. The drivers of green brand equity: Green brand image, green satisfaction, and green trust. Journal of Business Ethics 93: 307–19.
Chen, Yu-Shan, and Ching-Hsun Chang. 2012. Enhance green purchase intentions: The roles of green perceived value, green perceived risk, and green trust. Management Decision 50: 502–20.
Chen, Yu-Shan. 2011. Green organizational identity: Sources and consequence. Management Decision 49: 384–404.
Albino, Vito, Azzurra Balice, and Rosa Maria Dangelico. 2009. Environmental strategies and green product development: An overview on sustainability-driven companies. Business Strategy and the Environment 18: 83–96.
Pujari, Devashish, Gillian Wright, and Ken Peattie. 2003. Green and competitive: Influences on environmental new product development performance. Journal of Business Research 56: 657–71.
Lymperopoulos, Constantine, Ioannis Chaniotakis, and Magdalini Soureli. 2012. A model of green bank marketing. Journal of Financial Services Marketing 17: 177–86.
Costa, Joana, Diana Cancela, and João Reis. 2021. Neverland or Tomorrowland? Addressing (In)compatibility among the SDG Pillars in Eu-rope. International Journal of Environmental Research and Public Health 18: 11858.
Hoffman, Andrew John. 2018. The next phase of business sustainability. Stanford Social Innovation Review 16: 34–39.
Song, Wenhao, and Hongyan Yu. 2018. Green innovation strategy and green innovation: The roles of green creativity and green organizational identity. Corporate Social Responsibility and Environmental Management 25: 135–50.
Woodman, Richard W., John E. Sawyer, and Ricky W. Griffin. 1993. Toward a theory of organizational creativity. Academy of Management Review 18: 293–321.
Halbesleben, Jonathon R. B., Milorad M. Novicevic, Michael G. Harvey, and M. Ronald Buckley. 2003. Awareness of temporal complexity in leadership of creativity and innovation: A competency-based model. Leadership Quarterly 14: 433–54.
Hunt, Shelby D., and Robert M. Morgan. 1995. The comparative advantage theory of competition. Journal of Marketing 59: 1–15.
Cooper, Robert G. 1979. The dimensions of industrial new product success and failure. Journal of Marketing 43: 93–103.
Chang, Shih-Chia, Shiaw-Wen Tein, and Hsi-Ming Lee. 2010. Social capital, creativity, and new product advantage: An empirical study. International Journal of Electronic Business Management 8: 43–45.
Pirola-Merlo, Andrew, and Leon Mann. 2004. The relationship between individual creativity and team creativity: Aggregating across people and time. Journal of Organizational Behaviour 25: 235–57.
Ford, Cameron M. 1996. A theory of individual creative action in multiple social domains. Academy of Management Review 21: 1112–42.
Deshpande’, Rohit, John U. Farley, and Frederick E. Webster Jr. 1993. Corporate culture, customer orientation, and innovativeness in Japanese firms: A quadrad analysis. Journal of Marketing 57: 23–37.
Yoon, Seung Won, Ji Hoon Song, Doo Hun Lim, and Baek-Kyoo Joo. 2010. Structural determinants of team performance: The mutual influences of learning culture, creativity, and knowledge. Human Resource Development International 13: 249–64.
Smith, Preston G., and Donald G. Reinertsen. 1992. Shortening the product development cycle. Research- Technology Management 35: 44–49.
Amabile, Teresa M., Regina Conti, Heather Coon, Jeffrey Lazenby, and Michael Herron. 1996. Assessing the work environment for creativity. Academy of Management Journal 39: 1154–84.
Griffin, Abbie. 1997. The effect of project and process characteristics on product development cycle time. Journal of Marketing Research 34: 24–35.
Teece, David J., Gary Pisano, and Amy Shuen. 1997. Dynamic Capabilities and Strategic Management. Strategic Management Journal 18: 509–33.
Rodrigo-Alarcón, Job, Pedro M. García-Villaverde, María J. Ruiz-Ortega, and Gloria Parra-Requena. 2018. From social capital to entrepreneurial orientation: The mediating role of dynamic capabilities. European Management Journal 36: 195–209.
Wohlgemuth, Veit, and Matthias Wenzel. 2016. Dynamic capabilities and routinization. Journal of Business Research 69: 1944–48.
Andriopoulos, Constantine. 2001. Determinants of organisational creativity: A literature review. Management Decision 39: 834–40.
Arora, Ravi. 2002. Implementing KM—A balanced scorecard approach. Journal of Knowledge Management 6: 240–49.
Hsu, Ya-Hui, and Wenchang Fang. 2009. Intellectual capital and new product development performance: The mediating role of organizational learning capability. Technological Forecasting and Social Change 76: 664–77.
March, James G. 1991. Exploration and exploitation in organizational learning. Organization Science 2: 71–87.
Lee, Hyunsuk, and Donna Kelley. 2008. Building dynamic capabilities for innovation: An exploratory study of key management practices. R & D Management 38: 155–68.
Pavlou, Paul A., and Omar A. El Sawy. 2011. Understanding the elusive black box of dynamic capabilities. Decision Sciences 42: 239–73.
Galunic, D. Charles, and Kathleen M. Eisenhardt. 2001. Architectural innovation and modular corporate forms. Academy of Management Journal 44: 1229–49.
Clark, Kim B., and Takahiro Fujimoto. 1991. Product Development Performance: Strategy, Organization, and Management in the World Auto Industry. Boston: HBS Press.
Iansiti, Marco, and Kim B. Clark. 1994. Integration and dynamic capability: Evidence from product development in automobiles and main frame computers. Industrial and Corporate Change 3: 557–605.
Luyten, Hans, and Manuel Bazo. 2019. Transformational leadership, professional learning communities, teacher learning and learner cen-tred teaching practices; Evidence on their interrelations in Mozambican primary education. Studies in Educational Evaluation 60: 14–31.
Boehm, Stephan A., David J. G. Dwertmann, Heike Bruch, and Boas Shamir. 2015. The missing link? Investigating organizational identity strength and transformational leadership climate as mechanisms that connect CEO charisma with firm performance. The Leadership Quarterly 26: 156–71.
Pasha, Obed, Theodore H. Poister, Bradley E. Wright, and John C. Thomas. 2017. Transformational Leadership and Mission Valence of Employees: The Varying Effects by Organizational Level. Public Performance & Management Review 40: 722–40.
Thomas, W. H. Ng. 2017. Transformational leadership and performance outcomes: Analyses of multiple mediation pathways. The Leadership Quarterly 28: 385–417.
Sethibe, Tebogo Gilbert. 2018. Towards a comprehensive model on the relationship between leadership styles, organisational climate, inno-vation and organisational performance. International Journal of Innovation Management 22: 1850021.
Robertson, Jennifer L. 2018. The Nature, Measurement and Nomological Network of Environmentally Specific Transformational Leadership. Journal of Business Ethics 151: 961–75.
Mittal, Swati, and Rajib Lochan Dhar. 2016. Effect of green transformational leadership on green creativity: A study of tourist hotels. Tourism Manage 57: 118–27.
Chen, Yu-Shan, and Ching-Hsun Chang. 2013. The Determinants of Green Product Development Performance: Green Dynamic Capabilities, Green Transformational Leadership, and Green Creativity. Journal of Business Ethics 116: 107–19.
Caplan, Robert D. 1987. Person-environment fit theory and organizations: Commensurate dimensions, time perspectives, and mechanisms. Journal of Vocational Behavior 31: 248–67.
Le, Phong Ba, and Hui Lei. 2018. The mediating role of trust in stimulating the relationship between transformational leadership and knowledge sharing processes. Journal of Knowledge Management 22: 521–37.
Han, Seung-hyun, Gaeun Seo, Jessica Li, and Seung Won Yoon. 2016. The mediating effect of organizational commitment and employee empowerment: How transformational leadership impacts employee knowledge sharing intention. Human Resource Development International 19: 98–115.
Andriopoulos, Constantine, and Marianne W. Lewis. 2010. Managing innovation paradoxes: Ambidexterity lessons from leading product design companies. Long Range Planning 43: 104–22.
Bass, Bernard M. 1985. Leadership and Performance beyond Expectations. New York: Free Press.
Reiter-Palmon, Roni, and Jody J. Illies. 2004. Leadership and creativity: Understanding leadership from a creative problem-solving perspective. The Leadership Quarterly 15: 55–77.
Gong, Yaping, Jia-Chi Huang, and Jiing-Lih Farh. 2009. Employee learning orientation, transformational leadership, and employee creativity: The mediating role of employee creative self-efficacy. Academy of Management Journal 52: 765–78.
Avolio, Bruce J., Bernard M. Bass, and Dong I. Jung. 1999. Re-examining the components of transformational and transactional leadership using the Multifactor Leadership Questionnaire. Journal of Occupational and Organizational Psychology 72: 441–62.
Podsakoff, Philip M., Scott B. MacKenzie, Robert H. Moorman, and Richard Fetter. 1990. Transformational leader behaviors and their effects on followers’ trust in leader, satisfaction, and organizational citizenship behaviours. Leadership Quarterly 1: 107–42.
Sarros, James C., Brian K. Cooper, and Joseph C. Santora. 2008. Building a climate for innovation through transformational leadership and or-ganizational culture. Journal of Leadership & Organizational Studies 15: 145–58.
Ayag, Zeki. 2005. An integrated approach to evaluating conceptual design alternatives in a new product development environment. International Journal of Production Research 43: 687–713.
Orsato, Renato J. 2006. Competitive environmental strategies: When does it pay to be green? California Management Review 48: 127–43.
Fitzsimmons, James A., Panagiotis Kouvelis, and Debasish N. Mallick. 1991. Design strategy and its interface with manufacturing and marketing: A conceptual framework. Journal of Operations Management 10: 398–415.
Brown, Shona L., and Kathleen M. Eisenhardt. 1995. Product development: Past research, present findings, and future directions. The Academy of Management Review 20: 343–78.
Benn, Suzanne, Melissa Edwards, and Tim Williams. 2014. Organizational Change for Corporate Sustainability. London: Routledge, p. 364.
Stark, John. 2015. Product lifecycle management. In Product Lifecycle Management 1: 1–29.
Chen, Chialin. 2001. Design for the Environment: A Quality-Based Model for Green Product Development. Management Science 47: 250–63.
Cronin, J. Joseph, Jr., Jeffery S. Smith, Mark R. Gleim, Edward Ramirez, and Jennifer Dawn Martinez. 2011. Green marketing strategies: An examination of stakeholders and the opportunities they present. Journal of the Academy of Marketing Science 39: 158–74.
Gabler, Colin B., Robert Glenn Richey Jr., and Adam Rapp. 2015. Developing an eco-capability through environmental orientation and organizational innovativeness. Industrial Marketing Management 45: 151–61.
Chen, Tingting, Fuli Li, and Kwok Leung. 2016. When Does Supervisor Support Encourage Innovative Behavior? Opposite Moderating Effects of General Self-Efficacy and Internal Locus of Control. Personnel Psychology 69: 123–58.
Chang, Ching-Hsun. 2016. The Determinants of Green Product Innovation Performance. Corporate Social Responsibility and Environmental Management 23: 65–76.

© Text is available under the terms and conditions of the Creative Commons Attribution (CC BY) license; additional terms may apply. By using this site, you agree to the Terms and Conditions and Privacy Policy.

Upload a video for this entry

Information

Subjects: Business

Contributors MDPI registered users' name will be linked to their SciProfiles pages. To register with us, please refer to https://encyclopedia.pub/register :

Luan Nguyen

Doan Hau

Anh Thu Nguyen

View Times: 667

Entry Collection: Environmental Sciences

Update Date: 27 May 2022

Table of Contents

Video Upload Options

Confirm