Unlocking resilience: the impact of Industry 4.0 technologies on manufacturing firms' response to the COVID-19 pandemic

Abstract

PurposeThis research investigates the impact of Industry 4.0 technologies (I4.0) on the resilience of manufacturing firms against the COVID-19 pandemic. The study explores the mediating effects linked to the firm’s supply chain resilience and absorptive capacity in this relationship.Design/methodology/approachThe empirical analysis involves 304 manufacturing firms and uses Partial Least Squares Structural Equation Modeling (PLS-SEM). A two-step hierarchical component model has been employed, considering the statistical analysis validation (reliability and validity) of the LOC and HOC models. The choice of the manufacturing industry is justified due to its degree of automation in emerging economies, such as Mexico, and its significant impact on job creation and the national gross domestic product.FindingsThe results confirm the positive impact of I4.0 technologies on companies’ resilience to COVID-19. They also support the indirect effects of the firm’s supply chain resilience and absorptive capacity. Absorptive capacity was found to have a higher significant indirect effect than supply chain resilience. Consequently, the study accentuates the significance of leveraging external knowledge and highlights the role of acquisition, assimilation, transformation, and exploitation capabilities in enhancing absorptive capacity.Research limitations/implicationsThe implications of this research extend to both manufacturing companies and public administrations, suggesting the need for I4.0 technologies implementation and supportive policies aimed at fostering absorptive capacity.Originality/valueThis research contributes to the literature by filling gaps in empirical studies in the context of developing economies. It provides valuable insights into the effects of I4.0 on absorptive capacity, supply chain resilience, and COVID-19 resilience, particularly in non-essential supply chains. It enriches the understanding of how I4.0 impacts the absorptive capacity and resilience of the supply chain during the COVID-19 crisis.