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There are two purposes in this paper. The first one is to explore the impact mechanisms and paths of service-oriented manufacturing (SOM) on the sustainability performance of green manufacturing firms and to pay particular attention to the mediating role of enterprise costs in the relationship between the two. The second one is to reveal the dynamic process and laws of SOM influencing on the sustainability performance of green manufacturing enterprises.

This paper employs a combination of dynamic and static research from two aspects. On the one hand, based on 495 green manufacturing firms in China, the authors verify the SEM of SOM, enterprise cost and sustainability performance of green manufacturing firms through empirical research, analyze the path relationship and mediation effect, and demonstrate its complex impact mechanism. On the other hand, the authors use agent-based modeling and simulation to reveal the dynamic influence of SOM on the sustainability performance of green manufacturing enterprises and explore its dynamic laws and future development trends.

The study results indicate that (1) SOM has a direct positive effect on firm sustainability performance. (2) Reducing firm costs has a positive effect on firm sustainability performance, and firm costs play a partial mediating role in the mechanism by which SOM influences firm sustainability performance. (3) The dynamic impact of SOM on sustainability performance increases significantly over time. (4) Significant firm heterogeneity exists in the process by which SOM improves sustainability performance. (5) There are differences in the promotion of SOM for economic performance, environmental performance and social performance.

This paper makes two main contributions. First, compared with previous research on sustainability performance focusing on a certain dimension, this paper organically integrates the three dimensions of sustainability performance, regards them as a whole and considers the paths to improve sustainability performance. Second, this paper focuses on the complex relationship among SOM, enterprise costs and sustainability performance and reveals different sustainability performance improvement paths and dynamic impact processes, thereby expanding and deepening previous research on sustainability on the subject. These contributions lead to a better understanding of the driving forces and realization path for green manufacturing firms' sustainability performance from an integrated static and dynamic perspective.