The Interaction Effect of Manufacturing Flexibility and Quality Management on Environmental Performance

Abstract

Previous research suggested that manufacturing capability played an important role in enhancing environmental performance. The two dimensions of manufacturing capability, namely manufacturing flexibility and quality management, have been suggested as drivers for environmental performance. Unlike previous studies, we use a sample of 597 firms in Korea to investigate manufacturing flexibility, quality management, and their interaction international effect on environmental performance. It was found that manufacturing flexibility and quality management are positively associated with environmental performance. Additionally, their interaction was negatively related to environmental performance due to the trade-offs between the two, such as regarding organizational structure and culture. This study offers a novel perspective to the literature on environmental management by revealing such negative interaction because manufacturing flexibility and quality management are the main elements of manufacturing capability, and thus, firms should handle both appropriately.