Lean Six Sigma and Environmental Performance: Mediating Effects of Organizational Culture and Sustainable Supply Chain Management Using SEM-ANN Analysis

Lean Six Sigma (LSS) helps to enhance environmental performance (EP), which helps to adopt environmental sustainability-related practices and augment operational productivity by focusing on organizational waste elimination and defect reduction. Although the successful adoption of LSS has numerous benefits for small and medium-sized enterprises (SMEs), which ultimately help improve EP. This study examines Organizational Cultural Practices (OCP) and Sustainable Supply Chain Management (SSCM) as the mediating variables between LSS and EP. Our dataset is extracted from 382 respondents from Pakistani SMEs, whom we approached through LinkedIn, an industrial engineering consultancy, and professional training centers. We used three different software packages for data analysis, including Smart-PLS, Jamovi, and the Statistical Package for the Social Sciences. We executed Structural Equation Modeling, Confirmatory Factor Analysis, and an Artificial Neural Network Modeling (ANNM) to analyze relationships among LSS, OCP, SSCM, and EP. The results confirm that LSS positively influences EP at (Formula presented.), with OCP and SSCM acting as partial mediators at (Formula presented.), and (Formula presented.) respectively, and R² for EP is 0.649. Moreover, we found that the ANNM results have RMSE of 0.429 for training and 0.428 for testing. This study extends the literature of Goal Setting Theory.