Industry 4.0 technologies and circular economy: The mediating role of supply chain integration

There is a great expectation that Industry 4.0 technologies will enable better circular economy (CE) results at firms. However, it is unclear how these technologies might contribute to CE. We hypothesize that Industry 4.0 technologies are positively related to the level of integration among actors along the supply chain and within the firm supply chain integration (SCI), which, in turn, explains superior CE results. By employing partial least square structural equation models on original survey data based on a sample of more than 1200 Italian manufacturing firms and almost 200 adopters, we find that disentangling for the type of technologies is essential to understanding both their direct and indirect role toward CE. Smart manufacturing technologies have a stronger impact on CE outcomes than data processing technologies; the mediating effect of SCI is verified for the former but not for the latter type, questioning the possibility for those technologies to support sustained CE performance in the long run.

Automated summary

Industry 4.0 technologies are expected to contribute to better circular economy outcomes by improving integration levels within the supply chain and within firms. Smart manufacturing technologies have a stronger impact on circular economy results compared to data processing technologies.