Relationship among Industrial IoT, Circular Supply Chain Management Practices and Sustainable Performance of Manufacturing Companies: an Empirical Study

Syed Shah Alam (), Mujahid M. Latif (), Husam Ahmad Kokash () and Mst. Nilufar Ahsan ()
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Syed Shah Alam: Prince Sultan University
Mujahid M. Latif: Prince Sultan University
Husam Ahmad Kokash: Prince Sultan University
Mst. Nilufar Ahsan: Multimedia University

Circular Economy and Sustainability, 2025, vol. 5, issue 4, 3159-3186

Abstract: Abstract This study investigates the role of Industrial Internet of Things (IIoT) in enabling Circular Supply Chain Management (CSCM) and its impact on sustainable performance outcomes, including environmental, cost, and financial performance. Grounded in Dynamic Capabilities Theory (DCT) and the Technology-Organization-Environment (TOE) Framework, this research develops a comprehensive model to examine the relationships between IIoT adoption, circular practices, and firm performance. Focusing on Malaysian manufacturing firms, where Industry 4.0 adoption and CSCM practices are still emerging. This study offers a novel exploration of how IIoT acts as a strategic enabler for circular practices in a resource-constrained, developing economy. Using a quantitative approach, data were collected from 357 manufacturing firms and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings confirm that IIoT adoption significantly enhances CSCM practices, which in turn positively influence all dimensions of sustainable performance. Furthermore, CSCM mediates the relationship between IIoT adoption and sustainable outcomes. This study provides both theoretical and practical contributions by demonstrating how IIoT enables firms to reconfigure supply chain processes, optimize resource usage, and transition towards circular economy practices, ultimately driving measurable and long-term sustainability.

Keywords: Industrial Internet of things; Circular supply chain management; Sustainable performance; Dynamic capabilities theory; Technology-organization-environment framework (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s43615-025-00576-6

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