STUDY OF SELECT ISSUES IN THE IMPLEMENTATION OF GREEN MANUFACTURING PRACTICES IN INDIAN SMEs

Abstract

The manufacturing sector is growing very fast to meet the needs of the increasing population. The high growth of the manufacturing industry has an adverse effect on the environment, a major cause of anxiety for researchers and industrialists. India's small and medium enterprises (SMEs) sector is the backbone of the Indian economy. The contribution of small and medium enterprises (SMEs) is an integral part of a nation's economic development. However, SMEs haphazardly use energy and natural resources, causing environmental pollution. Some SMEs are aware of environmental issues and follow environmental regulations. The increasing ecological pollution compels the organization to adopt green manufacturing practices (GMP). The manufacturing practices which do not harm the environment during the manufacturing process are known as GMP. Many organizations/MNCs (multinational companies) are trying to follow green practices and manufacture green products. Still, SMEs are reluctant to implement green practices due to poor awareness and inadequate resources. Green manufacturing aims to reduce the consumption of natural resources needed to produce finished goods through efficient manufacturing processes that lower the negative externalities of waste and pollution. Green manufacturing is about using green energy, developing green products, and employing green techniques to optimize the use of resources and wastage. However, the Indian SMEs are not interested in green manufacturing and thus lag far behind the target. Depending on the consumption pattern, the manufacturers can be motivated to adopt green manufacturing practices by the increasing demand for green products. In the present research, attempts have been made to find the factors influencing consumer behaviour and the production of green products. A literature survey explores consumer behaviour and purchasing intentions toward green products. Further, an attempt has also been made to x determine the reasons for the reluctance to implement green manufacturing practices by Indian SMEs. The Partial Least Square-Path Modeling (PLS-PM) approach is used to know the causal relationship among the various factors of consumer behaviour, their impact on the production of green products, and find out the effect of the adoption of green manufacturing practices on the organizational performances. The result shows that the perceived quality and cost of the product influence the consumers' purchase intentions for green consumption. Along with these two factors, green initiatives, advertising and promotion, and social welfare also significantly influence consumers toward using green products. The research results show that the fear of financial loss amongst Indian SMEs is hypothetical; instead, there is an increase in profit and market share if the company goes for green manufacturing practices. Many obstacles to green manufacturing practices (GMP) are identified through the literature survey and discussion with researchers and industry experts. The identified obstacles are classified into six groups: financial, managerial, operational, technological, regulatory, and environmental obstacles by factor analysis (FA) methods. The best-worst method (BWM) technique has been utilized to rank these obstacles according to their impact on GMP. Indian SMEs can quickly adopt GMP by addressing these sceptical obstacles. Factors influencing green practices in SMEs have been identified from past literature, and an index to assess and benchmark green practices has been produced. From the literature survey total of 27 factors are recognized and bunched into seven major groups: top management commitment, effective government legislation and implementation, economic interest, consensus on green management, firm's competitiveness, green product design and development, and strong supplier relationship management. Based on these xi factors, an index has been developed using Graph Theory and Matrix Approach (GTMA) to evaluate the green practices of the firm under consideration. This study may attract consumers toward the green product and thus motivate management to produce green products. The framework developed may help managers assess their respective organizations' green performance as values taken from different green sub-factors are based on the inputs given by the manager of SMEs. A firm can also compare the green index of its organization with other organizations or with the best in the industry for benchmarking purposes. Benchmarking green practices may help organizations develop strategies to improve the green approach of manufacturing the products and resource conservation. Moreover, further studies may be conducted with different case studies to validate the proposed framework. Organizations can find strong and weak areas for implementing green practices based on the green index. Keywords: Green manufacturing practices (GMP), Small and medium-sized enterprises (SMEs), Consumer behaviour, obstacles to green manufacturing, organizational performance, Partial Least Square-Path Modeling (PLS-PM), factor analysis (FA), best worst method (BWM), Graph theory and matrix approach (GTMA).