Industry 4.0 deployment for circular economy performance-Understanding the role of green procurement and remanufacturing activities

As regulatory authorities emphasize sustainable practices, manufacturing organizations rely on Industry 4.0 technologies to shift their business model from a linear to a circular economy. While intuitively this transformation seems straightforward, in reality, it is rather nuanced, thereby necessitating scholarly investigation into process-based antecedents of circular economy performance of organizations. This study used structural equation modeling to analyze empirical data from 278 Indian manufacturers. Largely, the results demonstrate that the adoption of Industry 4.0 technologies does have a significant effect on the performance of the circular economy within these organizations, owing to their strong influence on green procurement and remanufacturing activities. Additionally, the results show that these process activities (e.g., green procurement and remanufacturing) do mediate the interaction between the deployment of Industry 4.0 and circular economy performance.

Automated summary

As regulatory authorities highlight the importance of sustainable practices, manufacturing organizations are utilizing Industry 4.0 technologies to transition their business model from linear to circular economies. This study analyzed empirical data from 278 Indian manufacturers using structural equation modeling, and the results indicate that the adoption of Industry 4.0 technologies significantly impacts the circular economy performance within these organizations. This impact is primarily due to the influence on green procurement and remanufacturing activities, with these process activities mediating the relationship between Industry 4.0 deployment and circular economy performance.