Investigating The Effect Of Reverse Logistics Barriers On Firm Performance

In current era,depletion of resources and environmental pollution captured deepening attention globally and Increasing solid waste is affecting environmental integrity due to heavy industrialization.The rapid increase in population,development in technology,the production,and consumption of shortening lifecycle products have increased worldwide.Due to massive production,more raw materials are consumed,which is enough for landfills and are filling up.Adaption of reverse logistics practices can help the producer to prevent from pollution by decreasing a load of end-of-life products(EOL)on the environment.Furthermore,the companies have been influenced by various constraints to implementing the reverse logistics(RL)practices.However,it's not easy to overcome these barriers.RL practices are the main drivers for application of sustainable development in manufacturing firm.These RL practices have more potential for changing the performance of RL and have a greater impact on company's economic performance(ECP)and environmental performance(ENP)because they directly influence on waste generation and resource consumption aspects.A very few studies exist to explore the role of RL barriers and adoption of different RL practices on company's performance.Different countries have established different practices to promote reverse logistics practices and foster sustainable development.Due to the difference in economic growth,the approaches to implement reverse logistics are different in developed nations and developing nations.However,RL implementation is in its initial stages in developing nations.Therefore,valuable lessons can be learned from developed nations.However,due to differences in rules and regulations,company size,operation systems,and maturity level of RL practices,the findings of earlier studies cannot be applied to the Pakistani manufacturing industry.Considering the lack of studies,above-mentioned reasons of not generalizing results in Pakistan,and new environmental policy in Pakistan,this study has following three main objectives: 1)Identification and verification of RL barriers in Pakistani manufacturing context using an integrated methodology of Delphi Method(DM)and Structural Equation Modeling(SEM);2)developing interactions between RL barriers to identify their driving and dependence power by using an integrated methodology of Interpretive Structural Modeling(ISM)and MICMAC;3)investigating the role of RL barriers on firm performance in manufacturing industry of Pakistan through a structural model.The results of the three main studies are as follow:The most critical barriers with respect to each category are: high cost of reverse logistics adoption(finance and economics),lack of skilled professionals(knowledge and experience),lack of government supportive policies(law and regulation),poor organizational culture(management),lack of human resources(infrastructure and technology),lack of environmental law awareness(environment),lack of community pressure(market)and company policies(reverse logistics in policy).Overall,the top five barriers found in this study include lack of initial capital,lack of skilled professional in RL,companies' policies against RL,lack of new technologies and information systems,and lack of community pressure.Results of ISM and MICMAC identified organizational,financial,and technological barriers as dependent barriers.However,lack of government policy incentives,lack of responsiveness about RL,lack of enforceable laws on product return,changing in regulations due to political changes,lack of environmental law awareness and lack of corporate social responsibility emerged out as top-ranked barriers driving other barriers that need to be addressed.Infrastructure & technology,Financial & economic,Knowledge & experience-based barriers are the critical and negatively affecting adoption of RL practices.Adoption of RL practices has positive effect on company's economic and environmental performance both.Adoption of RL practices mediates the relationship between “infrastructure & technology and economics performance”;“Financial & economics and economics performance”;“knowledge & experience and economics performance”;“infrastructure & technology and environmental performance”;“Financial & economics and environmental performance” and “knowledge & experience and economics performance”.The results of this research help to extend literature review presenting that the ecological modernization and new environmental laws and regulation should be integrated with enterprises to mitigate infrastructure & technology,financial & economic and knowledge & experience related barriers by conducting proper training programs and promoting sustainability and environmental protection among company's top management.Furthermore,current research also contains the managerial implications,particularly for Pakistani manufacturing context,as the selection of main barriers by the team of professionals from the manufacturing industry and scholars in Pakistan.However,the finding of this research might be beneficial for manufacturing industries situated in the rest of developing economies.The findings might be beneficial for the adoption of RL practices in India,China and Iran,which are the most emerging economies of the region.