Supply chain managers confront numerous threats and opportunities in today's competitive environment. Firms simultaneously face increased pressure to lower costs and to be innovative. In addition, most firms are also under increased pressure to improve their environmental (ecological) performance. These rival demands from the competitive environment make it difficult for supply chain managers to determine how a specific investment will influence performance. Thus, inevitable tradeoffs among investments must be assessed and implemented. This research examines the efficacy of investments in environmental management in different competitive environments, and provides guidelines for supply chain managers in determining when and how they should respond to simultaneous pressures to improve economic and ecological performance.