The Importance of Logistics Information Technologies and Knowledge Management Capabilities on Intermediaries' Performance

The Importance of Logistics Information Technologies and Knowledge Management Capabilities on Intermediaries' Performance

Meltem Yavuz (Istanbul University, Turkey) and Burak Deligönül (Istanbul University, Turkey)
Copyright: © 2017 |Pages: 18
DOI: 10.4018/978-1-5225-2133-4.ch011
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Abstract

In the climbing conditions of competition, companies must take strategic steps in order to make profits. From this point of view, those companies which possess information in the right way and utilize it efficiently and timely will have more advantages in reaching their goals than their rivals. Along with technology which develops each day, information which forms the core of an effective logistics management has become a factor which enables companies to establish their logistics strategies competitively. As it is known, distinguish knowledge resources from the process of trying to manage them is become crucial issue for the companies. Logistics information technologies and knowledge management capabilities have been seen as a compelling organizational capability to enhance performance of intermediaries. This chapter aimes to explore the effects of Logistics Information Technologies (LIT) and Knowledge Management Capabilities (KMC) on intermediaries' performance.
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Introduction

As known, the scope of the logistics industry is not limited with cargo transportation and the performance of transportation is dependent on a proper management of different logistics functions. Especially logistics service providers which possess third-party logistics (3PL) features have often actualised themselves in the two basic logistics functions which are transportation and storage (Shi & Zhang, 2015). At this point, the importance of Logistics Information Technologies (LIT) are emerging for complicated logistics operations which can involve many elements such as logistics service providers, sub-carriers, intermediaries, etc.(Vaidyanathan, 2005). In general, the concept of intermediaries can be defined as economic agents (for profit organizations) that bring together suitable sides in order for operations in many sectors, mainly commercial and economical, to be performed in the most profitable way possible; and provide applications to these sides that support their operations. In other words, intermediaries, whatever the sector may be, are referred to as economical agencies that bring sellers together during commercial processes are performed, or find sides like the supplier, buyer, seller, carrier, or the alternatives of these; and carry out operations such as following-up and ensuring the sustainability of financial movements in commercial processes, and ensuring stock continuity (Spulber, 1996). Logistics service providers like freight forwarders, customs brokers, foreign trade companies, and agencies, often have a direct impact on the workings of processes within a supply chain.

In recent years, based on the propositions of the Dynamic Capabilities (DC) view, the focal point of strategy research has been management of strategic resources effectively since a firm’s ability to acquire, bundle, deploy and develop resources through capabilities is more important than static resource (such as information technologies) endowments in driving organizational performance (Sirmon, 1998; Sirmon, Hitt, & Ireland, 2007; Maritan & Peteraf, 2011; Sirmon et al., 2011). Maritan and Peteraf (2011) suggest that organizational performance “arises from differential complementarities between a resource and firms’ existing resource portfolio and capabilities” (p. 1380). Since firms compete by deploying bundles of complementary resources, the effectiveness of a resource or a number of resources is contingent on the firms’ capabilities (Teece, 1998; Sirmon, et al., 2007). Similarly, effectiveness of a capability may also be contingent to another organizational capability (Sirmon et al., 2007). Especially in high velocity environments, effective deployment of productive resources can be achieved through integration of multiple capabilities (Eisenhardt & Martin, 2000; Peteraf, Stefano, & Verona, 2013). Zahra, Sapienza and Davidsson (2006) found that the low knowledge transfer capability of firms was the consequence of another low dynamic capability – a deficient problem-solving capacity in the face of change. Sirmon, Gove and Hitt (2008) state that multiple capabilities are needed to compete effectively and management of scarce resources should be the utmost concern of managers.

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