The Effect of Top Management Commitment on Firm Performance through the Green Purchasing and Supplier Relationship Management in 3-Star Hotel Industry in Surabaya

Abstract

The local government needs to facilitate the Hotel through industry regulations, and one of the requirements is the obligation of each Hotel to pay attention to environmentally friendly practices. This study investigates the effect of top management commitment on firm performance through green purchasing and supplier relationship management in the 3-star Hotel. This study used a Census survey for all 71 3-star Hotel domiciled in the City of Surabaya. Data collection used a questionnaire with a five-point Likert scale. Questionnaire distribution was conducted by email, social media, and direct delivery to the respondent. Sixty-one from seventy-one questionnaires, a response rate of 86%, were filled in duly and considered valid for further analysis. Data analysis used the partial least square technique by utilizing Smart PLS. The result of the analysis demonstrated that top management commitment affects supplier relationship management by path coefficient of 0.544. Top management commitment affects firm performance with path coefficient of 0.281. However, this study indicated that top management commitment does not affect green purchasing. Furthermore, supplier relationship management has a significant effect on green purchasing with path coefficient of 0.391. Similarly, supplier relationship management also affects firm performance with a path coefficient of 0.377. Finally, Green purchasing significantly improves firm performance with a path coefficient of 0.226. This work provides a new insight for the manager on how to increase firm performance in the context of supply chain management. This study could contribute to enriching the current research in supply chain management.

Effect of Supplier Collaboration on Company Performance through Lean Manufacture and Inventory Control

“…Collaboration built by the company with suppliers is a form of partnership as a strategic relationship that aims between the company and suppliers to share compatible goals strive for mutual benefit, and recognize a high level of interdependence (Tanuwijaya et al, 2021). The partnership process involves the company and suppliers working together to plan and carry out supply chain operations regarding the procurement of raw materials, quality of raw materials, and well-coordinated time to achieve common goals and mutual benefits .…”

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The Effect of Early Supplier Involvement on Firm Performance through Teamwork and New Product Development

“…Research conducted by Benton Jr et al ( 2020) states that the development carried out by suppliers of automated companies in America in providing raw materials can increase company performance by improving product quality, delivery performance, and product price. Supplier relationship management, one part of the early supplier involvement, significantly affects firm performance in the manufacturing industry in Surabaya, Indonesia (Chandra Tanuwijaya et al, 2021). Previous research conducted by Car (2016) regarding supplier involvement in purchasing strategies on company performance shows a positive correlation.…”

Impact of Supply Chain Integration, Supply Chain Responsiveness, and Innovation Capability on Operational Performance in Era Covid-19

“…Supplier integration facilitates suppliers to understand and anticipate the needs of factory networks. Supplier relationship management, one of the supply chain integration, significantly affects firm performance in the 3-star Hotels in Surabaya, Indonesia (Chandra Tanuwijaya et al, 2021). In addition, research on fifty-three 3PL logistics companies in East Java, Indonesia, indicated that customer relationship management, which is part of supply chain integration, significantly affects organizational performance (Santoso & Siagian, 2019).…”