Strategic Innovations for Sustainability and Their Impact on Business Performance in Dynamic Environments: A Mediated–Moderation Perspective

Abstract

Purpose: This paper explores how strategic innovation (SI) can impact business performance (BP) through the mediating effect of sustainability (SS) and moderating effect of environmental dynamism (ED). The research is seeking to comprehend how companies can improve on performance outcomes through incorporation of innovation strategies with sustainability practices within dynamic business environments.

Design/methodology/approach: The study adopted a quantitative and cross-sectional research design. A survey was conducted on 188 enterprises which practiced sustainability using a structured questionnaire. The hypothesis was tested using Structural Equation Modeling (SEM) to assess the direct and mediating as well as the moderating relationships between SI, SS, BP, and ED.

Findings: The results demonstrate that SI has a positive impact on BP both directly and indirectly via SS. Sustainability was identified as a considerable mediating variable, which means that the better the organizations are aligned to sustainability goals, the better the performance results are achieved. Moreover, the ED mediates the association between SI and BP in a positive manner, which implies that innovation strategies are more efficient in uncertain and rapidly changing conditions.

Originality: This research has implications in the current body of literature as it creates a comprehensive framework that explores the direct, intermediate and moderating relationships between SI, SS, BP and ED concurrently. The research offers empirical information on the enhancement of strategic innovation on organizational performance by sustainability and environmental dynamism, thus presenting a holistic view of strategic management in business sustainability in contemporary business settings