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Absorptive capacity and interpretation system's impact when ‘going green’: an empirical study of ford, volvo cars and toyota
Author(s) -
Williander Mats
Publication year - 2007
Publication title -
business strategy and the environment
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.123
H-Index - 105
eISSN - 1099-0836
pISSN - 0964-4733
DOI - 10.1002/bse.479
Subject(s) - insider , interpretation (philosophy) , exploit , automotive industry , marketing , rationality , product (mathematics) , mode (computer interface) , consumption (sociology) , economics , industrial organization , business , sociology , computer science , engineering , law , social science , geometry , computer security , mathematics , political science , programming language , aerospace engineering , operating system
Whether or not it pays to be green or under what circumstances is an important ongoing debate among economic researchers. However, this question, with its rather instrumental rationality, may underestimate another key issue: the ability of companies to create value that can be captured from customers. This paper reports on three companies in the automotive industry developing and launching cars with improved eco‐environmental performance and less petrol consumption. The study reveals that, despite being captured in the same technological paradigm, the individual company's mode of environmental interpretation and its aspiration to exploit new technology may be two important explanatory factors in its ability to go green profitably. The study indicates that an enacting mode of environmental interpretation may be superior to a discovering mode, and suggests that for companies having a discovering mode there may be a need to complement existing engineering practice with insights into consumer psychology, and bundling of common good versus private good product attributes. The research upon which this paper is based was conducted using an insider/outsider approach in studying the three companies. Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment.