Analyzing the mediating role of organizational ambidexterity and digital business transformation on industry 4.0 capabilities and sustainable supply chain performance

Purpose Despite the growing awareness of supply chains on industry 4.0 (I4.0) capabilities as the enabler of sustainable performance, little is known about what accelerates this interaction. Prior studies have focused on the ambidexterity dilemma and the need to adopt sustainable inter-organizational governance to drive I4.0 capabilities while achieving sustainable performance. To address these issues, this paper aims to explore the distinct and combined effects of several approaches such as digital business transformation (DBT), organizational ambidexterity (OA) and circular business models (CBMs) on the relationship between I4.0 capabilities and sustainable performance. Design/methodology/approach Drawing upon a hybrid methodology including structural equation modeling and fuzzy set qualitative comparative analysis, this paper develops and tests a hypothetical model using data collected from 306 organizations in Europe, Asia and Africa. Findings The study findings lead to several important implications concerning the potential paths linking I4.0 and sustainable performance. Notably, the DBT was found to mediate this relationship by integrating circular principles to devise business models. Moreover, OA was found to substitute the CBMs in developing new sustainable business models and reconcile sustainability. Originality/value The study is among the first to analyze the combined effects of OA, DBT and CBMs on the relationship between I4.0 capabilities and sustainable performance at the supply chain level. Moreover, the findings propose several solutions to resolve the sustainability dilemma through I4.0 capabilities, DBT, OA and CBMs.