Document Type : Research Paper


1 Master of Industrial Management, Faculty of Management, Gilan University, Rasht, Iran

2 Associate Professor, Department of Management, Faculty of Management, Gilan University, Rasht, Iran


The purpose of this article is to design a model for improving the sustainable performance of small and medium food companies in Guilan Province. The aim is to provide managers and decision-makers with insights into the factors, challenges, and consequences associated with enhancing the sustainable performance of these companies in the current business environment. The article falls under the category of applied research in terms of its purpose, exploratory-descriptive research in nature, and field studies based on data collection. It is classified as qualitative research. The Grounded Theory method was employed to create a paradigm model, progressing through three stages of open, axial, and selective coding. The results of data analysis using Grounded Theory led to the identification of 13 main floors, 29 main categories, and 248 concepts. The paradigm model, developed through theoretical coding, encompasses six main classes: pivotal phenomenon (sustainable performance improvement), causal conditions (organizational survival, social and environmental obligation, gaining competitive advantage), contextual conditions (environmental factors, organizational factors), interfering conditions (environmental factors, organizational factors), and strategies (macro level, organizational level). Finally, the economic, social, and environmental consequences of achieving sustainable performance improvement were derived through the implementation of these strategies.
The increasing societal focus on sustainability necessitates attention to improving sustainable performance in small and medium-sized companies. Today, achieving a competitive edge and attracting customers goes beyond operational or financial superiority. In the contemporary business landscape, companies are expected to demonstrate responsibility and consider future generations in their activities. SMEs play a pivotal role in the industrial growth of developing economies globally. Enhancing communication and information flow in small and medium-sized companies can lead to more efficient processes and cost reduction. To thrive in the current business environment, SMEs must adopt emerging technologies to improve their sustainable performance. Industry 4.0 and the circular economy, which involve the use of advanced technologies like artificial intelligence and the Internet of Things, can be instrumental in achieving sustainable performance in these companies. The synergy between Industry 4.0 technologies and circular economy methods positively contributes to enhancing sustainable performance. Given that small and medium industries are significant drivers of economic growth in regions like Guilan province, improving the sustainable performance of companies in this sector can have a substantial impact on preserving and maintaining environmental aspects. With the rapid growth of technology and the advancement of Industry 4.0, SMEs are recognized as vital economic foundations contributing to the development and economic growth of societies. It is crucial to investigate and conduct research in the field of Industry 4.0 and the circular economy to improve the sustainable performance of small and medium-sized companies. A conscious analysis of the benefits and challenges of Industry 4.0 on SMEs allows for a better understanding of the needs and opportunities within this sector. Examining the effectiveness and utilization of new technologies in the processes and organizational structures of small and medium companies can lead to increased efficiency, cost reduction, improved quality, enhanced decision-making processes, and expanded market presence.

Literature Review

Performance, in a broad sense, can be defined in accordance with the concept of quality and an organization's ability to achieve internal and external goals. It is important to note that performance encompasses multiple dimensions. Sustainability, on the other hand, is a multidimensional concept that presents a significant challenge in our time. It involves the understanding and management of economic, social, and environmental performance simultaneously. Researchers argue that if the current population and economic growth rates persist, the utilization of the planet's natural resources will surpass its capacity. This issue gives rise to environmental protection concerns, which are addressed under the umbrella of sustainable development. Sustainable development is defined as development that meets the needs of the present without compromising the ability of future generations to meet their own needs. In a broader sense, a sustainable development strategy entails creating harmony among humans and between humans and nature. It implies that sustainability requires a societal approach that manages the environmental perspective alongside the economic perspective in the progress of development and performance improvement. In the present era, there is an expectation from customers and members of society for companies and organizations to be responsible and consider future generations in their activities and operations. Prioritizing the future generation in activities signifies a positive step towards sustainable performance and demonstrates the organization's commitment to a sustainable global economy. While the concept of sustainability is easily understood, operationalizing and concretely expressing it poses challenges. Decision-makers in industries need to evaluate and review their operations considering both internal and external effects. Optimal decisions can only be made when the social, economic, and environmental consequences are taken into account.


The Research falls under the category of applied research in terms of its purpose, exploratory-descriptive research in nature, and field studies based on data collection. Grounded theory, a qualitative research approach, is particularly well-suited for exploratory research seeking to theorize or identify patterns. It employs open, axial, and selective coding methods for data analysis. This approach, introduced by Strauss and Corbin in 1990, is based on the three-stage coding process of open, axial, and selective (or theoretical) coding. In this regard, it utilizes the logical paradigm or diagrammatic representation of the theory created. Research based on the grounded theory approach, employing a systematic strategy, culminates in the development of hypotheses and statements that may specify the relationships between classes in the axial coding paradigm.

Discussion and Results

The central category identified is Sustainable Performance Improvement. Two dimensions associated with this central category are Industry 4.0 and the circular economy. The most crucial factors influencing sustainable performance improvement are categorized into three groups: organizational survival (including profitability and maintaining market share), social and environmental requirements (such as attracting public support, considering future generations, and managing limited resources), and gaining competitive advantage (encompassing both temporary and sustainable competitive advantages). These factors contributing to sustainable performance improvement are further classified into two categories: environmental factors and organizational factors. Environmental factors involve challenges such as environmental instability, legal factors, and political factors, while organizational factors encompass financial and cost considerations, along with human resources. Strategies for achieving desirable outcomes are outlined at both the macro level (involving government and industrial estate company activities related to consortium formation, culture, and education) and the organizational level. Small and medium-sized food industry companies are encouraged to pursue innovation, creativity, value chain knowledge, and professional structure to create favorable benefits for themselves. The final segment of the sustainable performance improvement model outlines economic, social, and environmental consequences. Key consequences at the economic level include company development, sustainable profitability, and sustainable productivity. At the social level, consequences encompass the welfare of workers and the social responsibility of the organization. The most critical consequence at the environmental level is the achievement of a sustainable environment.


To design a model for enhancing the sustainable performance of small and medium-sized companies, the grounded theory methodology with the systematic approach of Strauss and Corbin was employed. This involved conducting interviews with experts to gather the necessary conceptual codes. Following the systematic approach, data analysis utilized three stages: open coding, axial coding, and selective coding. The design of the model adhered to the paradigm model of this approach, incorporating six dimensions: the central category, causal conditions, contextual conditions, intervening conditions, strategies, and consequences.


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