Resource-Based Logistics (RBL) and Competitive Advantage: Logistics 4.0Ps Model

Resource-Based Logistics (RBL) and Competitive Advantage: Logistics 4.0Ps Model

Noorliza Karia (Universiti Sains Malaysia, Malaysia) and H.M. Emrul Kays (Universiti Sains Malaysia, Malaysia)
DOI: 10.4018/978-1-7998-1397-2.ch010


Logistics service is more complex and knowledge-based in the fourth industrial revolution era. Given this significance, this chapter emphasizes the logistics industry and its specific dynamic capabilities, and measures generating the Industry 4.0 by extending the resource-based logistics (RBL) of Noorliza (2011). The chapter has three parts: Logistics in the fourth industrial revolution, RBL theory, and its impacts and Logistics 4.0 models in the fast-moving environment. This explains how logisticians or logistics firms obtain competitive advantages in the fourth industrial revolution era.
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Industry/Logistics 4.0 changes completely the way a logistics service provider (LSP) operates which involves many technologies such as Internet of Things (IoT), Internet of service (IoS), cloud-based logistics, radio frequency (RFID) and enterprise resource planning (ERP). It means digitization of all operations within the entire supply chain and integration of physical systems with cyber worlds (Asdecker and Felch, 2018). Industry 4.0 incorporates real-time big data monitoring of material flows, data intensive and dynamic structural organization between various elements in the supply chain, transport management, flexible and intelligent logistics system for better optimize costs, time and resources.

The economic environments and ever-changing customer needs also have brought logistics in the current trend of the digitization of organization within and external to organization’s supply chain. Transforming an organization to digitization means require dynamic and rapid change. An organization digitization requires strategic decision-making for successfully implementing Logistics 4.0. Industry 4.0 within logistics includes developments in resource efficiency and sustainability of logistics system, a LSP and people/community and environment. In addition, the information and communication enabled technologies facilitate the delivery system, information exchange and decentralized decision-making and control without much human interaction. For instance automated data management will lead to a better-automated decisions making.

Given this fast-moving environment, there is a lack of attention to how logistics service providers build in their dynamic capabilities or new resources and capabilities (Asdecker and Felch, 2018). In the fast-moving global trade, there has been rapid and complex demands from consumers. In order to compete, firms have to face with the dynamic customer expectations through their dynamic capabilities to facilitate the demands of global market (products and/or services) across the world. Some existing studies empirically tested the impact of dynamic capabilities on firm performance but not comprehensively (Noorliza and Wong, 2013). However, previous study does not provide for managers with what and which dynamic capabilities a firm needs to deal with the demands of the rapidly shifting environment.

Logistics services with agility can help the firm to serve the customers with speed and surprise. Advanced or innovative logistics service has become the proactive approach for empowering service innovation capability and competitiveness. The fast-growing global economy is indeed enormous; hence, leads to increase the significant demand on advanced logistics services dramatically and dynamic. The future trend of logistics service providers (LSPs) should add values to logistics users and improves customer satisfaction; and provides a firm's competitive advantage. This dynamic business environment/market has completely changed the nature of logistics industry through the diverse requirements of new logistics services. These requirements of new logistics services are different from conventional logistics. Hence, managers need to understand how firms build their dynamic capabilities into delivering successful services that has a greater impact on business performance.

In the effort to expedite these dynamic and complex services, we argue that LSPs need to provide the total digitization logistics service/business for handling materials movement right from the sources of raw materials flowed into manufacturing until the finished products distributed to end user. Based on a dynamic capabilities perspective, we hold that logistics firms require new constructs and measurements of more complex and ambiguous resources and capabilities for delivering successful logistics services. We define these complex and ambiguous resources and capabilities as boosters of dynamic capability that lead to the Logistics 4.0 and competitive advantages.

In the rapidly shifting environment, the dynamic capabilities are the most essential sources to achieve sustainable competitive advantage in the long run. According to the dynamic capabilities perspective, firms build new resources and capabilities in the dynamic environment. Firms that are in the dynamic and complex environments invest in their dynamic capabilities in order to adapt with their environments. We argue that LSPs exploit and build new competencies and position themselves for competitive advantage as the Logistics 4.0 evolve. Hence, LSPs within the competitive environments proactively build their dynamic capabilities for delivering successful services.

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