Accepted Manuscript

Resource management practice through eco-innovation toward sustainable

development using qualitative information and quantitative data

Chia-Hao Lee, Kuo-Jui Wu, Ming-Lang Tseng

PII: S0959-6526(18)32392-8

DOI: 10.1016/j.jclepro.2018.08.058

Reference: JCLP 13842

To appear in: Journal of Cleaner Production

Received Date: 15 November 2017

Accepted Date: 06 August 2018

Please cite this article as: Chia-Hao Lee, Kuo-Jui Wu, Ming-Lang Tseng, Resource management
practice through eco-innovation toward sustainable development using qualitative information and
quantitative data, Journal of Cleaner Production (2018), doi: 10.1016/j.jclepro.2018.08.058

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 ACCEPTED MANUSCRIPT

Resource management practice through eco-innovation toward sustainable development

using qualitative information and quantitative data

Chia-Hao Lee

Department of Finance, Ming Dao University, Taiwan

E-mail: leolee171@gmail.com

Kuo-Jui Wu

School of Business, Dalian University of Technology, China

E-mail: wukuojui@dlut.edu.cn

Ming-Lang Tseng* (Corresponding Author)

Institute for Innovation and Circular Economy, Asia University, Taiwan

E-mail: Tsengminglang@gmail.com

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Resource management practice through eco-innovation toward sustainable development

using qualitative information and quantitative data

Abstract

Many firms are aware that eco-innovation is an important issue in resource management

practice due to its contribution to firms’ competencies and capabilities. Eco-innovation

represents a differentiating attribute for sustainable business in fiercely competitive

environments. However, prior studies have not examined the role of eco-innovation in

sustainable development through hierarchical structural analysis of resource management

practice to address firms’ capabilities and competencies; in particular, the attributes contain

qualitative information and quantitative data. This study proposes a hybrid method

comprising the fuzzy Delphi method, importance-performance analysis, and a decision-

making trial and evaluation laboratory to rank the attributes and assist firms in decision-

making. The result supports the use of advanced eco-friendly technologies and the selection

of potential talent to support eco-innovation and foster changes in strategic vision,

management structure, and administrative procedures. Clear policies and procedures,

mutual trust and respect, and sales staff characteristics are needed to improve firm

performance toward sustainable business.

Keywords: eco-innovation; resource management practice; fuzzy Delphi method;

importance-performance analysis; decision-making trial and evaluation laboratory

(DEMATEL)

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Resource management practice through eco-innovation toward sustainable development

using qualitative information and quantitative data

1. Introduction

Firms consider environmental strategy as an instrument to simultaneously achieve

growth targets, competitiveness and profitability (Andersen, 2010; Porter and Van Der Linde,

1995). Achieving economic growth is highly reliant on innovation and generates vast

environmental impacts. Consumer environmental awareness, social expectations and

government pressure are forcing firms to pay more attention to social and environmental

issues in new product development (Bocken et al., 2014; De Medeiros et al., 2014).

Addressing these sustainable development issues becomes an involved and complex task

that challenges time limitations, knowledge, finances, human resources, management styles

and organizational structure (Lee, 2002; Jenkins, 2004). Green practices implemented to

resolve these challenges need to involve all the management function’s activities, and all

firms’ functions take responsibility for innovating the green practices. A set of attributes and

environmental dynamism that explains the interrelationship between resource management

practice (RMP) and eco-innovation is required to guide firms toward sustainable

development goals in order to ensure that green practices are efficient and effective while

addressing the associated challenges.

There are eco-innovation activities involved in the implementation of interventions,

subsidies and other instruments to achieve sustainable development goals, although they

progressively isolate market signals. These activities might not be implemented in the

appropriate time period to generate the desired control level. Hence, planning and resource

utilization have become prescriptive and are promoted by regulations and policies

(Robertson, 1993; Tseng and Bui, 2017). Prior studies have attempted to inspect the

operational process for eco-innovation in qualitative information and quantitative data.

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However, the attributes that determine whether these operations affect RMP are not well

addressed (Sierzchula et al., 2012; Cai and Zhou, 2014). LesLEvidow et al. (2016) presented

that eco-innovation consists of several innovative practices, including economic and

ecological resource benefits, production process improvements to realize lower resource

burdens, harmful material substitutions, water recycling and waste reduction. To achieve

effective eco-innovation, RMP plays an important role as a source of creativity and

intelligence that guarantees the quality and innovation of a firm’s sustainable development

and newly developed green products. Firms maintain team motivation toward resolving

challenges through a set of reliable and valid measures.

RMP includes human, knowledge and information technology resources, which are

divided into intangible and tangible resources (Sarkis et al., 2010; Doran and Ryan, 2012;

Tseng and Bui, 2017). Though prior studies focused on sustainable business practices have

generally concentrated on investigating eco-innovation development and performance in a

specific area (such as product-service innovation, service innovation, technological

innovation, or infrastructure and policy innovation), the linkage between eco-innovation and

RMP has not been identified (Rehfeld et al., 2007; Shin et al., 2008; Tseng et al., 2013). In

particular, the attribute measures contain qualitative information. Thus, this study addresses

the following questions:

 What is a firm’s eco-innovation attributes in RMP?

 What attributes improve RMP through eco-innovation with qualitative information and

quantitative data?

Firms encounter difficulties in balancing social, economic and environmental

performance than developed economies, and this balancing process needs to consider eco-

innovation in RMP integration. However, eco-innovation and RMP are lacking in prior

studies, in which the launch of eco-innovation is considered a cost-prohibitive activity and

the resources needed to guarantee strategy implementation are lacking (Wu et al., 2016;
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Tseng and Bui, 2017). This study applies the fuzzy Delphi method (FDM) to address linguistic

preferences and form the set of attributes. The decision-making trial and evaluation

laboratory (DEMATEL) addresses the interrelationships among the measures and uses an

importance-performance analysis (IPA) to perform the performance measures.

Nevertheless, the qualitative information and quantitative data are present in the measures.

Hence, there is a need to apply this hybrid method to study RMP through eco-innovation

toward sustainable development. Few prior studies have enabled firms to overcome the

complexity and uncertainty in eco-innovation assessments and toward sustainable

development among business practices (Dong and Shi, 2014). Hence, this study not only

concentrates on specific eco-innovation types for assessing performance but also identifies

the RMP effects on a firm’s eco-innovation performance.

The following section is a literature review that provides an extensive theoretical

background of RMP and illustrates proper eco-innovation measurement collection and

multi-attribute measurement development. Detailed information on hybrid methods is

presented in section 3. Case and empirical results are presented in section 4, and

implications and conclusions are discussed in section 5 and the final section.

2. Literature review

This section presents the proposed RMP attributes and reviews the extensive literature

focused on RMP through eco-innovation. The subsections review RMP, eco-innovation,

proposed methods and measures from prior studies.

2.1 Resource Management Practice

RMP provides a solid theoretical basis for deliberating on the contribution of resources

and capabilities to eco-innovation performance (Menguc and Ozanne, 2005; Dangelico and

Pujari, 2010). However, RMP may not be able to describe the optimal method of employing
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resources to gain a competitive advantage under rapid external eco-innovation changes

(DeSarbo et al., 2005; Hart, 1995). The capabilities and performance improved firms’

understanding of eco-innovation due to the interrelationships among multiresources. Under

shifting government regulations, stakeholder pressure and rapid market movement in terms

of eco-innovation, RMP must be able to identify methods for improving business

performance through eco-innovation activities. In addition, traditional management

functions ignore the constraints imposed by the natural environment, and the activities have

unaddressed ecological impacts. Prior studies neglect the application of RMP to eco-

innovation, in which significant emerging resources provide a competitive advantage

without sufficient support (Hart, 1995).

Steven and Robert (1985) argued that RMP in an operation embodies a set of important

choices about various attributes, such as equipment, process technologies, human skills and

inventory. Somsuk et al. (2012) categorized resources into four types: organizational,

technological, human and financial resources. These four types of resources had nearly the

same function, which suggested that technological resources were utilized in place of

physical resources (Barney and Hesterly, 1999). Technological resources are

intangible resources for intellectual property, accumulated skills and experience, software

licenses and innovative patents. Borch et al. (1999) defined “technological resources” as a

firm’s specific product and (physical) technology, equipment/laboratories, highly specialized

skill sets and technological capabilities. Moreover, the human resources include the

development team, management team and staff, which require unique aptitudes and

abilities to lead a firm toward success. Löfsten (2010) presented financial resources as all

types of financial support that a firm utilizes in all management activities. Organizational

resources consider activity plans, controls, coordination, systems, routines and relationships

within the entire firm (Barney, 1999; Tomer, 1987). Then, prior studies have emphasized

that the attributes of innovative success are a firm’s resources and capabilities (Christensen
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and Overdorf, 2000; Panne et al., 2003; Teece, 1988). RMP appears to be an appropriate

approach for launching innovative development. Sirmon et al. (2007) provided extensive

solid support than core competency theory for effectively investigating the eco-innovation

process. Nonetheless, there is a need to provide RMP through eco-innovation.

Hence, focusing on stakeholders enabled the establishment, generation and expansion

of processes to support RMP in efficient and effective resource development. A

reconfiguration process is used to address the transformation of assets by monitoring the

current situation to identify gaps and manage future changes (Drnevich and Kriauciunas,

2011; Pavlou and El Sawy, 2011; Tseng and Bui, 2017). RMP has been attracted attention in

the literature on thorough process discussions connecting precedent practices with eco-

innovation activities (Tseng and Bui. 2017; Wu et al., 2016; Wu et al., 2017). Many firms took

RMP and eco-innovation into account when launching sustainable development initiatives.

However, only a few studies have presented RMP through eco-innovation toward

sustainable development. Several prior studies have emphasized aspects of these practices

for assessing higher performance (Kindstrom et al., 2013; Tseng, 2011). This study integrated

RMP and eco-innovation to provide guidelines for sustainable practices’ benefits and to

generate lower revenue risk and reduce resource waste (Teece, 2007; Kindstrom et al., 2013;

Michailova and Zhan, 2014).

2.2 Eco-innovation

Eco-innovation is the development of products and processes that contribute

to sustainable development and the application of this knowledge to elicit direct or indirect

ecological improvements in external and internal boundaries. The external boundary

contains all the firm’s external practices for green and sustainable practices and includes

suppliers, regulations, and market demand (del Río et al., 2010; Lin et al., 2013). The internal

boundary includes practices related to the efficient and effective management of the eco-
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innovation process among firms, including the firm’s management, production process and

new product design (Dangelico and Pontrandolfo, 2010; Lin et al., 2013; Wu et al., 2016). In

addition, Alegre and Chiva (2008) stated that sustainable development requires the

generation of continuous eco-innovation as one of the critical practices in this rapidly

changing world. Carrillo-Hermosilla et al. (2010) utilized eco-innovation as an instrument and

linked it with innovation systems and renovated the entire system through ecological and

economic considerations. Eco-innovation needed to fulfill customer needs and social

expectations in the initial step and then promote the investment of further eco-innovation

through cost savings, efficient resource utilization, and regulation compliance (Kesidou and

Demirel, 2012). Moreover, several studies have attempted to address eco-innovation from

different perspectives, such as organizational culture, strategy and leadership, government

policy, stakeholders and the features of eco-innovation (Porter-O’Grady and Malloch, 2010;

Veugelers, 2012; Lin et al., 2013).

However, Kemp and Arundel (1998) argued that eco-innovation should take technical,

organizational and marketing innovations into account. The Organization for Economic Co-

operation and Development (OECD) (2005) identified four distinct types of eco-innovation:

product, process, organizational and marketing innovation. del Río et al. (2010) categorized

eco-innovation into three innovation types — process/product, mature/immature and

radical/incremental innovation — in the decisive design process to determine the

environmental impacts of innovation. Horbach (2008) and Triguero et al. (2013) presented

eco-process, eco-product, eco-organization and innovation practices as critical attributes of

eco-innovation and discovered that eco-innovation activities encompass each main aspect of

a firm that contains the relevant activities that pertain to different sorts of functions. These

activities lead to the improvement of a firm’s process function, changes in existing products

and the development of new products toward sustainable development.

Several theories pertain to different aspects of the eco-innovation puzzle and cover
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institutional theory, cognitive theories, transaction cost economics, sociotechnical

approaches, market orientation and resource-based views; however, the relationship

between eco-innovation and RMP is undefined (Barney, 1991; Borch et al., 1999; Cai and

Zhou, 2014). Prior studies have attempted to demonstrate that eco-innovation is an

effective RMP approach (Wu et al., 2015; Tseng and Bui, 2017). These firms’ activities are

difficult to perceive, build, assess and implement in related attributes due to the complex

interrelationships and uncertainties that occur in practice. Hence, the goal of this study is to

establish a systematic assessment for identifying specific attributes from eco-innovation

requirements (Carrillo-Hermosilla et al., 2010). To overcome such limitations, this study

proposes a hybrid method for assessing eco-innovation performance and RMP together.

2.3 Proposed Method

Prior studies have applied classical statistical methods to approach RMP (Barney, 1991;

Robertson, 1993; Somsuk et al., 2012; Trainor et al., 2013). However, few studies have

discussed RMP attributes through linguistic preferences. Hence, the FDM is proposed to

filter unnecessary attributes based on experts’ judgment. An IPA is integrated with DEMATEL

to assess the degree of performance and categorize the attributes into cause and effect

groups. FDM has been implemented in management science for the prediction and analysis

of public policy and project planning (Dalkey and Helmer, 1963). Tseng and Bui (2017)

integrated triangular fuzzy numbers and FDM to enhance the accuracy of results and reduce

the uncertainty of expert judgments. This proposed method enables the transfer of expert

judgments from two terminal points into membership degrees, thereby avoiding the impacts

of statistical bias and extreme values. The advantage of this method is the simple integration

of all expert judgments and the screening out of unnecessary criteria (Javad et al., 2016;

Tseng, 2009b).

The IPA is applied more widely in analytical fields, is used to solve particular
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management problems and provides an extremely transparent and replicable instrument for

identifying the pros and cons of scenarios and determining areas for resource arrangement

based on increasing the adaptive capacity to provide resource management in districts with

complex governance (Tseng and Bui, 2017; Wu et al., 2016). However, the IPA cannot

integrate performance with importance into a single number as a final score. This study

integrates DEMATEL with IPA to determine the overall final score and achieve decision-

making.

A full understanding of cause-and-effect interrelationships is developed for RMP

attributes. This study proposes a hybrid method that integrates the advantages of FDM, IPA

and DEMATEL. The proposed method enables the assessment of the interactions among

RMP criteria and explores the effects between RMP and eco-innovation. This study employs

fuzzy set theory to transform the linguistic preferences from expert judgments into

quantitative values due to human preferences containing high uncertainty and possessing

qualitative features (Javad et al., 2016; Tseng, 2009a). These values must be transformed

into precise values before acquiring the final results. Such linguistic terms are used to define

rough perceptions based on fuzzy numbers to manage the uncertainty of assessing

information and the vagueness of linguistic expression. Hence, this study applies a hybrid

method approach to handle complex situations.

2.4 Proposed Measures

Javad et al. (2016) proposed four critical concerns when exploring an optimal solution

of inventory management issues within buyer and supplier partnerships. These concerns

address physical constraints, shortages, discounts and demand variations. In the supply

chain, discounts are used to motivate the buyer to purchase greater amounts of product;

thus, offering price reductions affects order quantities. However, shortages occur, and the

original orders cannot be fulfilled when the market demand or production is not satisfied on
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time, which generates back-order costs. In addition, the features of demand variation

possess high uncertainty, and generating accurate forecasts is difficult, which causes

additional costs and insolvency. The bullwhip effect is a well-known phenomenon under

demand variation, and it typically occurs if a firm makes overly optimistic predictions of

market demand. Subsequently, the available space, budget, facilities and logistics are all

restricted by physical constraints that generally occur in real world eco-innovation launches.

Somsuk et al. (2012) reviewed the extensive business literature in terms of RMP aspects

and then categorized resources into four types: technological, human, financial, and

organizational resources. Technological resources concentrate on know-how, infrastructure

and technologies/ideas (Hisrich and Smilor, 1988; Barney and Hesterly, 1999), and financial

resources refer to all financial support and consulting, in-kind financial support and access to

finance and capitalization (Hacket and Dilts, 2004; Lee and Osteryoung, 2004). Human

resources include talented managers, expert organization, coaching and on-site business

expertise (Hackett and Dilts, 2004; Sierzchula et al., 2012), and organizational resources refer

to the capabilities connected with the selection process for potential talent, concise program

milestones with clear policies and procedures, mutual trust and respect, technology transfer,

and research and development (Hacket and Dilts, 2004; Lee and Osteryoung, 2004).

Moreover, knowledge management is considered a crucial resource for developing a

competitive advantage and creating value, and it needs to be considered a fundamental core

competence. Knowledge management enables the generation of dynamic assets that firms

maintain and guides the firm’s conduct (Massa and Testa, 2009; Tseng, 2011). The function

of knowledge management is to bridge humans and computers when exploring meaningful

knowledge resources (Lee et al., 2002; Feng et al., 2004; Holsapple and Joshi, 2004;

Holsapple and Wu, 2011). Additionally, Massa and Testa (2009) indicated that knowledge

creation/acquisition, knowledge storage, knowledge transfer and knowledge application

should be included in knowledge management. Knowledge creation/acquisition relates to

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the internal knowledge used to conduct current practices or the knowledge obtained from

outside resources. Knowledge transfer helps firms distribute knowledge to those who need

it.

The integrative capability of a firm involves the ability to deliver unexpected

resources/abilities when adapting to new routines/opportunities that occur during regular

changes and adjustments (Liao et al., 2009). This capacity enhances the firm’s ability to

gather, integrate and adopt all practices to launch eco-innovation; therefore, integrative

capability can be used to forecast the performance of eco-innovation (Cai and Zhou, 2014;

Wu et al., 2015). Wu et al. (2015) discussed eco-innovation in dynamic organizational

capability by proposed product-service processes; collaboration with research institutes,

agencies and universities; subsidies and fiscal incentives; new product development time;

organizational performance adjustments; sales staff quality; and eco-organizational

innovation motivations when assessing eco-innovation effectiveness and performance

(Horbach, 2008; Horbach et al., 2012; Cai and Zhou, 2014; Hofstra and Huisingh, 2014). The

initial set of proposed measures is shown in Table 1.

Table 1. Initial set of proposed measures

Aspects Criteria References
C1 Selection process for potential talent
Hacket and Dilts, 2004;
C2 Concise program milestones with clear
Organizational Lee and Osteryoung,
AS1 policies and procedures
resources 2004;
C3 Mutual trust and respect
C4 Technology transfer and R&D
Eco- C5 Administrative efforts toward
Cruz et al., 2006
AS2 managerial renewing organizational routines
Massa and Testa, 2008
innovations C6 Procedures
C7 Technology/ideas
Technological Hisrich and Smilor,
AS3 C8 Know-how
resources 1988
C9 Infrastructure
Financial C10 Access to financing and capitalization Hacket and Dilts, 2004;
AS4
resources C11 Financial support and consulting Lee and Osteryoung,

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C12 In-kind financial support 2004

C13 Discounts
Inventory C14 Shortages
AS5 Javad et al., 2016
management C15 Demand variation
C16 Physical constraints
C17 Knowledge creation/acquisition Holsapple and Wu,
Knowledge
AS6 C18 2011;
management Knowledge transfer
Massa and Testa, 2009
C19 Coaching
Human C20 Talented managers Sierzchula et al., 2012;
AS7
resources C21 Expert organization Hacket and Dilts, 2004;
C22 On-site business expertise
C23 Shortening product life cycles
Eco-product Carrilo-Hermosilla et
AS8 C24 Advanced eco-friendly technologies
innovation al., 2010
C25 Increasing competition
C26 Collaboration with research institutes,
agencies and universities
C27 Product-service process
Horbach, 2008;
Eco-innovation C28 Subsidies and fiscal incentives
Horbach et al., 2012;
effectiveness C29 New product development time
AS9 Cai and Zhou, 2014;
and C30 Motivation for eco-organizational
Hofstra and Huisingh,
performance innovation
2014
C31 Organizational performance
adjustments
C32 Quality of the sales staff

3. Method

RMP attributes are often incorporated into an assessment model that contains qualitative

and quantitative information. Data transformation and computation processes are described

below.

3.1 Case Background

The Taiwanese electronics firms increase RMP during eco-innovation processes. The

case firm has attempted to improve human life through the design of a series of products

and the provision of a variety of services. These products and services rely on the firms’
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know-how, management and eco-innovation practices, which were produced through long-

term research and development, offer flexibility and competence for Taiwanese electronics

firms and enable cooperation with partners in developed countries under the original

equipment manufacturing mode. In addition, these firms guarantee the growth of economic

scale and simultaneously satisfy consumers’ requirements for low costs, on-time delivery

and consistent quality. The question to be answered is how causal decisive criteria affect

eco-innovation and generate the appropriate dynamics to reinforce the firm’s

competitiveness.

The present case firm is to undergo a merger and acquisition by an international firm.

This firm is one of the world’s largest electronic firms. However, there are a few failed

strategies regarding RMP through eco-innovation. Hence, strategies and business models are

important references for relevant firms to compete in the intense industry. To clarify the

competition of the case firm and provide a better understanding of RMP and eco-innovation,

this study takes incomplete information into account and proposes a hybrid method to

identify the interrelationships among the attributes. Face-to-face interviews and online

inquiries are adopted to consult with expert groups for the development of the effectiveness

questionnaire. The expert group is composed of three executive managers, five senior

managers, five senior engineers and three professors who have seven years of working

experience related to the industry. The following analytical results can provide quantitative

support for guiding electronics firms to enhance the competitiveness and improve the

performance to compete in the market.

3.2 Quantitative Data Transformation

Crisp values are identified from the assessment of performance, which contains

numerous units and cannot be directly calculated. Standardizing these values requires

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normalization of the crisp values. The normalization process of 𝐴𝑆𝑎𝑏 adopts the following

equation (Tseng et al., 2009; Wu et al., 2016):

(𝐴𝑆𝑎𝑏𝑖 ‒ 𝑚𝑖𝑛𝐴𝑆𝑎𝑏𝑖 )
𝐴𝑆𝑎𝑏 = , 𝑖 = 1,2,⋯𝑚 (1)
(𝑚𝑎𝑥 𝐴𝑆𝑎𝑏𝑖 ‒ 𝑚𝑖𝑛𝐴𝑆𝑎𝑏𝑖 )
𝑖
( 1 2 𝑖
)
where 𝑚𝑎𝑥 𝐴𝑆𝑎𝑏 = 𝑚𝑎𝑥 𝐴𝑆𝑎𝑏,𝐴𝑆𝑎𝑏,⋯𝐴𝑆𝑎𝑏 and 𝑚𝑖𝑛𝐴𝑆𝑎𝑏 = 𝑚𝑖𝑛 𝐴𝑆𝑎𝑏,𝐴𝑆𝑎𝑏,⋯𝐴𝑆𝑎𝑏 .
𝑖
( 1 2 𝑖
)

3.3 Fuzzy Delphi Method

Ishikawa et al. (1993) proposed the integration of fuzzy set theory with the traditional

Delphi method. In addition, Noorderhaben (1995) applied FDM to acquire a group decision

to solve the fuzziness of expert judgments in order to improve the efficiency and quality of

questionnaires. Suppose that the value of significance of a number 𝑏 element is assessed by

a number 𝑎 expert as 𝒿 = (𝓁𝑎𝑏,𝒸𝑎𝑏,𝑟𝑎𝑏), 𝑎 = 1,2,3,⋯𝑛;𝑏 = 1,2,3,⋯𝑚; then, the weighting 𝒿𝑏

1𝑛
of the number 𝑏 element is 𝒿𝑏 = (𝓁𝑏,𝒸𝑏,𝑟𝑏), where 𝓁𝑏 = 𝑚𝑖𝑛 (𝓁𝑎𝑏), 𝒸𝑏 = ∏𝑛1𝒸𝑎𝑏 ( ) , and 𝑟𝑏 =

𝑚𝑎𝑥 (𝑟𝑎𝑏). Thus, the linguistic terms and triangular fuzzy numbers are transformed into

linguistic values, as shown in Table 2.

Table 2. Transformation table of linguistic terms

Corresponding Important
Linguistic terms 1.0
triangular fuzzy
(performance/importance)
numbers
Performance

Extreme (0.75, 1.0, 1.0) 0 0.25 0.50 0.75 1.0

Demonstrated (0.5, 0.75, 1.0)

Strong (0.25, 0.5, 0.75)
Moderate (0, 0.25, 0.5) Triangular fuzzy membership functions for
Equal (0, 0, 0.25) performance/importance

To generate the convex combination value 𝐻𝑏, the following equations are proposed,

which adopt an 𝛼 cut approach to generate the result (Wu et al., 2016):

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𝑢𝑏 = 𝑟𝑏 ‒ 𝛼(𝑟𝑏 ‒ 𝒸𝑏), 𝑙𝑏 = 𝓁𝑏 ‒ 𝛼(𝒸𝑏 ‒ 𝓁𝑏), 𝑏 = 1,2,3,⋯𝑚 (2)

Generally, 0.5 is used to represent 𝛼 under the common situation. This value can be adjusted

based on whether the experts are optimistic or pessimistic adopters by setting it to 1 or 0.

The precise value of 𝐻𝑏 can be generated as follows:

𝐻𝑏 = ∫(𝑢𝑏, 𝑙𝑏) = λ[𝑢𝑏 + (1 ‒ λ)𝑙𝑏] (3)

where λ is utilized to express the degree of optimism for a decision maker and to balance

the radical judgments from the expert group. Then, 𝛿 = ∑𝑛𝑎 = 1(𝐻𝑏 𝑛) is the threshold in

filtering the necessary attributes. If 𝐻𝑏 ≥ 𝛿, the number 𝑏 criterion is accepted to assess the

criteria. Otherwise, the criterion needs to be rejected.

3.4 Fuzzy Importance-Performance Analysis Integrated with DEMATEL

Assuming that a fuzzy set 𝑇 in a universe of discourse 𝐷 is featured by the membership

function 𝑓𝑇(𝐷), which represents a 0 to 1 membership function of 𝑇 (Tseng et al., 2008;

Tseng, 2009a; Wu et al., 2016), the membership function can be expressed through the

following equation to define the corresponding triangular fuzzy number (𝓁,𝒸,𝑟):

{
0, 𝐷 < 𝓁
(𝐷 ‒ 𝓁 )
(𝑐 ‒ 𝓁 ) , 𝑐 ≥ 𝐷 ≥ 𝓁
𝑓𝑇(𝐷) (𝑟 ‒ 𝐷 ) (4)
(𝑟 ‒ 𝑐) , 𝑟 ≥ 𝐷 ≥ 𝑐
0, 𝑜𝑡ℎ𝑒𝑟𝑤𝑖𝑠𝑒

These triangular fuzzy numbers depend on the three-value determination that covers

the minimal number 𝓁, the mean number 𝒸 and the maximal number 𝑟. The criteria values

are compared with linguistic terms before they are transformed into triangular fuzzy

numbers. Table 2 displays the triangular fuzzy numbers that correspond to linguistic terms

based on the proposed quick transformation.

Set 𝐼𝑎𝑏 becomes the importance-weighted value of aspect 𝑎 and criterion 𝑏, whereas

the membership function of the triangular fuzzy numbers 𝐼𝑎𝑏 ∈ 𝐸. Subsequently, 𝐽𝑎𝑏

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becomes the performance value of aspect 𝑎 and criterion 𝑏 when the membership function

of triangular fuzzy numbers 𝐽𝑎𝑏 ∈ 𝑄.

𝑘
( 𝑘 𝑘 𝑘
) 𝑘 𝑘 𝑘
𝐼𝑎𝑏 = ∆𝓁𝑎𝑏,∆𝒸𝑎𝑏,∆𝑟𝑎𝑏 , 𝐼𝑎𝑏 ∈ 𝐸, where 0 ≤ ∆𝓁𝑎𝑏 ≤ ∆𝒸𝑎𝑏 ≤ ∆𝑟𝑎𝑏 ≤ 1
𝑘
(5)

𝑘
( 𝑘 𝑘 𝑘
) 𝑘 𝑘 𝑘
𝐽𝑎𝑏 = ∇𝓁𝑎𝑏,∇𝒸𝑎𝑏,∇𝑟𝑎𝑏 , 𝐼𝑎𝑏 ∈ 𝑄, where 0 ≤ ∇𝓁𝑎𝑏 ≤ ∇𝒸𝑎𝑏 ≤ ∇𝑟𝑎𝑏 ≤ 1
𝑘
(6)

𝑘
where 𝐼𝑎𝑏 represents the assessed value from an expert’s judgement of aspects 𝑎 and

criterion 𝑏. Because the judgments are expressed as fuzzy numbers, a defuzzification process

is required to transform these numbers into crisp values. Subsequently, the center-of-area

approach proposed by Lin et al. (2013) is adopted to obtain the best nonfuzzy performance

𝛽𝑎. Eqs. (7) and (8) generate the best nonfuzzy performance value from fuzzy weights.

∆
[(∆𝑟𝑎𝑏𝑘 ‒ ∆𝓁𝑎𝑏𝑘 ) + (∆𝒸𝑎𝑏𝑘 ‒ ∆𝓁𝑎𝑏𝑘 )] 𝑘
𝛽𝑎 = 3 + ∆𝓁𝑎𝑏, ∀𝑖 (7)

∇
[(∇𝑟𝑎𝑏𝑘 ‒ ∇𝓁𝑎𝑏𝑘 ) + (∇𝒸𝑎𝑏𝑘 ‒ ∇𝓁𝑎𝑏𝑘 )] 𝑘
𝛽𝑎 = 3 + ∆𝓁𝑎𝑏, ∀𝑖 (8)

The final score 𝜏 is obtained from Eqs. (7) and (8):

(∑𝛽∆𝑎 × 𝛽∇𝑎)
𝜏= 𝜇 (9)

where 𝜇 represents the amount of aspects or criteria.

Finally, a cause-and-effect diagram is produced through mapping 𝛽𝑎 and 𝛽𝑎 as ( ∇) ( ∆)

( ∇)
horizontal and vertical axes. If 𝛽𝑎 has a better performance, the aspects or criteria are

( ∆)
located on the right-hand side. 𝛽𝑎 , which denotes the importance of aspects or criteria, is

located on the upper side, representing its higher importance. Moreover, the cause-and-

effect diagram can be divided into four quadrants to identify the effects.

3.5 Proposed Analytical Procedures

This study attempts to assess the importance of criteria to provide precise guidelines

for firms in managing the RMP. The proposed method addresses the gaps in prior studies. To
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enhance the validity and reliability of the measures, the following systematic analytical

procedures are applied.

1. Possible attributes are collected from the literature. Then, using face-to-face interviews

or online inquiries, these proposed attributes are finalized with the experts.

2. To enhance the consistency and accuracy of a proposed measure, FDM is used to filter

the necessary attributes by applying Eqs. (1) - (3). The questionnaire is reproduced and

the experts performed an additional assessment based on these valid and reliable

attributes.

3. In the second round of assessment, the respondents follow Eqs. (4) - (8) to acquire the

best nonfuzzy performance. Eq. (9) is subsequently adopted to generate the final score.

( ∇)
4. The attributes are mapped into the cause-and-effect diagram taking 𝛽𝑎 and 𝛽𝑎 as the( ∆)
horizontal and vertical axes. This diagram is divided into four quadrants: driving area (I),

indicating higher importance and better performance; core problem area (II), showing

higher importance but lower performance; independent area (III), meaning lower

importance and lower performance; and volunteering area (IV), presenting higher

performance and lower importance.

4. Results

This section provides the background for the Taiwanese electronics industry and the

analytical results. The results provide quantitative support for firms managing RMP and eco-

innovation.

1. The relevant information from recent literature is collected, and the expert group is

consulted to structure the initial set of proposed measures, as shown in Table 1.

2. The thirty-two proposed criteria in Table 1 are assessed by the expert group based

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on experience and judgment. After the assessment, these linguistic terms are

transformed into corresponding triangular fuzzy numbers by adopting Table 2.

Then, Eq. (1) is used to normalize different units into comparable values. Through

these comparable values, Eqs. (2) and (3) are applied to filter out the appropriate

attributes, which are presented in Tables 3 and 4. The final attributes are

subsequently renamed, as shown in Table 5.

Table 3. FDM filtering for aspects

Initial Set Renamed 𝐻𝑏 Decision
AS1 A1 0.78 Accepted
AS2 0.47 Rejected
AS3 A2 0.80 Accepted
AS4 A3 0.77 Accepted
AS5 0.59 Rejected
AS6 0.53 Rejected
AS7 A4 0.71 Accepted
AS8 A5 0.75 Accepted
AS9 A6 0.77 Accepted
𝛿 0.69

Table 4. FDM filtering for criteria

Initial Set Renamed 𝓁𝑎𝑏 𝒸𝑎𝑏 𝑟𝑎𝑏 𝓁𝑏 𝑢𝑏 𝐻𝑏 Decision
C1 D1 0.25 0.72 1.00 0.02 0.86 0.43 Accepted
C2 D2 0.25 0.84 1.00 -0.04 0.92 0.45 Accepted
C3 D3 0.50 0.96 1.00 0.27 0.98 0.56 Accepted
C4 D4 0.25 0.59 1.00 0.08 0.80 0.42 Accepted
C5 0.00 0.62 1.00 -0.31 0.81 0.33 Rejected
C6 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C7 D5 0.25 0.73 1.00 0.01 0.86 0.43 Accepted
C8 0.00 0.59 1.00 -0.30 0.80 0.32 Rejected
C9 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C10 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C11 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C12 D6 0.25 0.69 1.00 0.03 0.84 0.43 Accepted
C13 0.00 0.59 1.00 -0.30 0.80 0.32 Rejected
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C14 0.00 0.00 1.00 0.00 0.50 0.25 Rejected

C15 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C16 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C17 0.00 0.79 1.00 -0.40 0.90 0.35 Rejected
C18 0.00 0.63 1.00 -0.31 0.81 0.33 Rejected
C19 0.00 0.59 1.00 -0.30 0.80 0.32 Rejected
C20 D7 0.25 0.72 1.00 0.02 0.86 0.43 Accepted
C21 D8 0.25 0.73 1.00 0.01 0.86 0.43 Accepted
C22 0.00 0.62 1.00 -0.31 0.81 0.33 Rejected
C23 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C24 D9 0.25 0.64 1.00 0.06 0.82 0.42 Accepted
C25 0.00 0.59 1.00 -0.30 0.80 0.32 Rejected
C26 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C27 D10 0.25 0.80 1.00 -0.03 0.90 0.44 Accepted
C28 0.00 0.59 1.00 -0.30 0.80 0.32 Rejected
C29 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C30 0.00 0.00 1.00 0.00 0.50 0.25 Rejected
C31 D11 0.25 0.79 1.00 -0.02 0.90 0.44 Accepted
C32 D12 0.25 0.84 1.00 -0.04 0.92 0.45 Accepted
𝛿 0.36

Table 5. Final attributes after renaming

Aspects Criteria
D1 Selection process for potential talent
Concise program milestones with clear
D2
A1 Organizational resources policies and procedures
D3 Mutual trust and respect
D4 Technology transfer and R&D
A2 Technological resources D5 Technology/ideas
A3 Financial resources D6 In-kind financial support
D7 Talented managers
A4 Human resources
D8 Expert organization
A5 Eco-product innovation D9 Advanced eco-friendly technologies
D10 Product-service process
Eco-innovation effectiveness and
A6 D11 Organizational performance adjustments
performance
D12 Quality of the sales staff

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3. Eqs. (4) – (9) are used to calculate the scores of importance and performance for the

aspects, as stated in Table 6. In addition, Figure 1 places performance 𝛽𝑎 on the ( ∇)

( ∆)
horizontal axis and importance 𝛽𝑎 on the vertical axis to map the aspects into a

diagram. A1, A2, and A5 are located in quadrant I; no aspects fall into quadrant II; A4 is

positioned in quadrant III; and A3 and A6 are located in quadrant IV.

( ∆)
Table 6. Importance 𝛽𝑎 and performance 𝛽𝑎 of the aspects ( ∇)
𝑘 𝑘
𝐼𝑎𝑏 𝐽𝑎𝑏
∆ ∇
𝛽𝑎 𝛽𝑎
𝑘 𝑘 𝑘 𝑘 𝑘 𝑘
∆𝓁𝑎𝑏 ∆𝒸𝑎𝑏 ∆𝑟𝑎𝑏 ∇𝓁𝑎𝑏 ∇𝒸𝑎𝑏 ∇𝑟𝑎𝑏

A1 0.720 0.970 1.000 0.498 0.748 0.930 0.897 0.725

A2 0.545 0.795 0.970 0.490 0.740 0.890 0.770 0.707
A3 0.505 0.755 0.978 0.495 0.745 0.938 0.746 0.726
A4 0.348 0.598 0.848 0.335 0.585 0.788 0.598 0.569
A5 0.595 0.845 0.978 0.515 0.765 0.913 0.806 0.731
A6 0.470 0.720 0.918 0.550 0.800 0.900 0.703 0.750

0.890 A1

II I
0.840

A5
Performance 0.790
A2
0.740
0.56 0.58 0.6 0.62 0.64 0.66 0.68 0.7 0.72A3 0.74 0.76

0.690 A6
III IV

0.640
Importance
A4 0.590

Figure 1. Aspects cause-and-effect diagram

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4. The last step is repeated to calculate the performance and importance values for the

criteria, as presented in Table 7. In Figure 2, these values are mapped into a diagram,

and the effects are identified. Quadrant I includes D1 and D9; quadrant II includes D2,

D3 and D12; quadrant III includes D4 and D10; and quadrant IV includes D5, D6, D7, D8,

and D11.

( ∆)
Table 7. Importance 𝛽𝑎 and performance 𝛽𝑎 of the criteria( ∇)
Performance Importance Performance Importance
D1 0.678 0.643 D7 0.660 0.546
D2 0.595 0.687 D8 0.653 0.500
D3 0.565 0.638 D9 0.713 0.690
D4 0.538 0.617 D10 0.608 0.588
D5 0.663 0.629 D11 0.683 0.560
D6 0.635 0.615 D12 0.585 0.821

0.85 Importance
II I
D12
0.8

0.75

0.7
D2 D9

Performance D3 0.65
D1
0.53 0.55 0.57 0.59 0.61 0.63 0.65 D5
0.67 0.69 0.71 0.73
D4 0.6 D6
D10
D11
0.55 D7

III 0.5 D8 IV

Figure 2. Criteria cause-and-effect diagram

5. Implications

This section provides theoretical and managerial implications of the analysis performed

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to identify significant insights.

5.1 Theoretical Implications

The results indicated that when implementing RMP, organizational resources (A1) must

be prioritized. Organizational resources provide a fundamental competence for the control

and coordination, which has been emphasized by Tomer (1987) and Barney (1999). In

addition, the resources reinforce the understanding of RMP and play an important role in

managing resources and leading firms toward sustainable development. Eco-innovation

generates the appropriate dynamics for firms to manage rapid changes both internally and

externally. The organizational resources motivate continuous organizational learning, which

promotes eco-innovation effectiveness and improves performance (Wu et al., 2015). This

evidence reveals the firms’ desire to acquire internal stability for competitive advantage

development.

Eco-product innovation (A5) plays a role in linking RMP development with the

emergence of specific capabilities for creating, exploring and exploiting opportunities to

compete with rivals (Zahra et al., 2006). Once firms perceive an eco-product innovation

opportunity and launch new product development, production processes and service

improvements (Teece, 2007; ; Tseng and Bui, 2017), the potential revenue obtained by

complying with environmental regulations and preventing negative impacts through the

launched products can be explored. Evidence reveals that eco-production innovation is a

necessity; however, it also requires academicians and practitioners to achieve an in-depth

understanding of relevant regulations and possess the ability to realize environmental

changes.

These results offer significant data that fulfil the knowledge gaps and establish a link

with eco-innovation to explore RMP through a multidimensional assessment. The

assessment considers prior studies and reflects real situations that enhance the ability of
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organizational resources to seize and profit from opportunities in a rapidly changing

environment. The results also demonstrate that a specific RMP can generate dynamics by

applying eco-innovation and show that RMP and eco-solutions are critical instruments for

constructing the required capabilities. Consequently, these capabilities enable the

generation of the dynamics required to achieve a competitive advantage.

5.2 Managerial Implications

Advanced eco-friendly technologies (D9) enable a firm to benefit from decreased costs

of products and services by improving the efficiency of resource utilization (Bodhani, 2012).

Advanced technologies include social media that promotes eco-friendly content, new

technologies that improve traditional points of sales, reduced product and service costs to

attract potential customers, new systems to search for alternative materials or components

to reduce environmental impacts. These technologies not only improve human life but also

change current business models and management styles. The electronics industry considers

technology the basis for providing e-commerce. Cloud computing represents a recent

technology that reduces cost, strengthens security and improves information storage and

access. Therefore, applying advanced eco-friendly technologies is a critical practice in eco-

product innovation and is connected to RMP.

Selection processes for potential talent (D1) are an essential practice for successful

incubators (Hackett and Dilts, 2004). Selection processes differ between incubators and

other types of firms. However, developing a functional selection process requires precise

threshold standards. These standards possess the function of screening out potential talent

and assessing suitable talent. In addition, several firms concentrate only on head hunting for

acquiring talent and are not interested in exploring potential talent.

Occasionally, the requirements of the customer may necessitate hiring qualified talent

to design or improve the process for satisfying environmental standards. The results reveal
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that more customers are active in pursuing eco-innovation products or processes and acting

as inventors and designers (Hienerth, 2006). Accordingly, the selection processes for

potential talent become a decisive practice for eco-innovation. If firms can develop a precise

standard for choosing potential talent, then the organizational resources are enhanced by

strengthening the firms’ competencies and capabilities.

Resource limitations cause firms to invest resources in critical areas to obtain maximal

improvement. The criteria included advanced eco-friendly technologies (D9) and selection

processes for potential talent (D1), which are located in the area of the diagram that

indicates better performance and higher importance. Therefore, these two criteria have

received sufficient resources for performance, although they are also important for firms

launching eco-innovation because they can improve RMP for developing a competitive

advantage. Nevertheless, three criteria require concise program milestones: clear policies

and procedures (D2), mutual trust and respect (D3) and quality of the sales staff (D12).

These criteria fall into the core problem area, which indicates higher importance but lower

performance. The criteria performance must be improved because the ranked criteria

possessed a higher importance for adopting eco-innovation.

6. Conclusions

The electronic firm has encountered difficulty in launching eco-innovation, which is

considered a cost-prohibitive activity that cannot guarantee profit generation. Most firms

applied RMP to develop competencies and capabilities to face the challenges of intense

rivals. This study proposes nine aspects and thirty-two criteria as initial measures based on

an extensive literature review to provide a greater understanding of the linkage between

RMP and eco-innovation. The hybrid method filters out unnecessary attributes in advance,

and the attributes are reduced to six aspects and twelve criteria. In addition, the hybrid

method offers a visual analysis to assist in the identification of an improvement method

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under resource limitations and enhances the accuracy and effectiveness in decision-making

for strengthening competences and capabilities.

This study presents three main theoretical, managerial and methodological

contributions. For the theoretical contribution, this study attempts to develop a framework

that is valid and reliable through eco-innovation and then enhance the understanding of

RMP through eco-innovation. For the managerial contribution, the analytical results reveal

the decisive attributes that provide precise guidelines for assisting firms in adjusting

resource utilization more efficiency and effectively. For the methodological contribution, this

study integrates fuzzy set theory to eliminate linguistic uncertainties and adopts the FDM to

screen out less important attributes, which makes the assessment more concentrated and

saves time while maintaining measurement consistency. The proposed hybrid method maps

the attributes onto a diagram to offer a straightforward visual analysis.

The findings verified that eco-innovation offers fundamental support to RMP and

implied that organizational resources and eco-product innovation are the top two attributes

for managing resources and generating the dynamics required to reinforce a competitive

advantage. Organizational resources should be focused on the process of selecting potential

talent, and eco-product innovation needs to focus on applying advanced eco-friendly

technologies. The two criteria assisted firms in developing the competencies and capabilities

through RMP. Moreover, the three criteria that presented higher importance and lower

performance were concise program milestones with clear policies and procedures, mutual

trust and respect, and quality of the sales staff. Urgent improvements are required, and

firms should shift a portion of the current resources from criteria that exhibited better

performance to the three criteria to achieve a sustainable business.

Several limitations are encountered in this study. Though the eco-innovation and RMP

literature was reviewed to identify the proposed measures, the series of attributes may not

be extensive. In addition, experts were chosen from the Taiwanese electronics firm only,
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which allowed us to control the contextual and operational attributes. However, these

findings present limitations in generalizability. Future studies should extend this work to

diverse industries to overcome the limitations. Additional cases need to be investigated to

reveal the unidentified attributes in order to deepen our understanding of RMP through eco-

innovation. The interrelationship between RMP and eco-innovation is an assumption of the

proposed method; however, further studies are required to determine the interrelationships

of these attributes, and comparisons should be performed to identify any differences in the

proposed attributes.

Acknowledgments

This study was supported by the Young Scientists Fund of the National Natural Science

Foundation of China (No. 71701029) and the Dalian University of Technology Fundamental

Research Fund [DUT16RC(3)038].

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