Benchmarking green operational capabilities in food-processing SMEs: motivation, innovation, knowledge and business sustainability performance

Abstract

Purpose This study benchmarks green operational capabilities (green motivation, green innovation and green knowledge management) against business sustainability performance in food-processing SMEs, identifying which capabilities constitute best-practice drivers and which represent performance gaps. Design/methodology/approach Drawing on data from 252 food-based SMEs in Greater Jakarta and employing covariance-based structural equation modeling (CB-SEM), the study tests how these capabilities influence green entrepreneurial behavior and sustainability performance. Findings Results reveal that green motivation and green innovation are high-performance benchmark capabilities that significantly drive entrepreneurial behavior and, in turn, sustainability outcomes. In contrast, green knowledge management is identified as an underperforming capability, exhibiting a knowledge–action gap in which environmental knowledge fails to translate into entrepreneurial behavior. A cross-firm benchmarking analysis further confirms that high-performing SMEs systematically outperform their peers on the motivational and innovation dimensions, whereas knowledge management scores do not differentiate performance clusters. Originality/value These findings contribute operational benchmarking insights for SME managers, industry associations, and policymakers seeking to prioritize capability investments for sustainability improvement.