How logistics performance is affected by supply chain relationships

• DOI: https://doi.org/10.1108/IJLM-09-2016-0204
• Pages: 284-307
• Date: 12 February 2018
• Published date: 12 February 2018
• Author: Miriam Catarina Soares Aharonovitz,José Geraldo Vidal Vieira,Suzi Sanae Suyama
• Subject Matter: Management science & operations,Logistics

How logistics performance is

affected by supply chain

relationships

Miriam Catarina Soares Aharonovitz

Federal University of Sao Carlos, Sorocaba, Brazil

José Geraldo Vidal Vieira

Department of Production Engineering, Federal University of Sao Carlos,

Sorocaba, Brazil, and

Suzi Sanae Suyama

CSCS, DHL Supply Chain, Campinas, Brazil

Abstract

Purpose –The purpose of this paper is to evaluate the effect of logistics collaboration, meetings, relationship

history, and supplier selection on the logistics performance of shippers, carriers, and logistics services

providers. Rather than focusing on collaboration and performance, the research provides a wide analysis of

how logistics collaboration and performance interact with other organizational practices.

Design/methodology/approach –To investigate the interaction among the constructs, the authors

proposed a structural equation model to understand the influence of meetings, relationship history,

supplier selection, and collaboration on logistics performance. The data were obtained through a survey of

199 managers of Brazilian companies in the retail sector.

Findings –Supplier selection has the strongest effect on logistics collaboration, and relationship history has

the strongest effect on logistics performance. Rather than meetings and operational features, the elements of

interpersonal skills, organizational culture, and communication appear to be the most important contributors

to logistics performance achievements; relationship history leads to better performance.

Originality/value –This study contributes to our understanding of how and with whom to collaborate

by highlighting the relationships among supplier selection, relationship history, meetings, and logistics

collaboration and logistics performance.

Keywords Supplier relations, Supply chain management, Logistics performance, Logistics collaboration

Paper type Research paper

Introduction

In the modern environment, companies compete by reducing costs and improving service

levels, and to create added value in the supply chain, they must build collaborative

channels with partners (Fawcett et al., 2012). This directive applies to shippers, carriers,

and logistics services providers (LSPs), which choose long-term logistics partners to

promote performance improvements. For LSPs, partnerships can reduce the costs and

improve the performance of logistics through joint activities and information sharing.

For example, governance mechanisms in horizontal cooperation among LSPs improve the

efficiency of transportation networks, information sharing, and the speed of the

cooperation process, thereby enhancing firm performance and increasing market success

(Raue and Wieland, 2015). From a shipper’s point of view, collaborative relationships can

reduce inventories and increase effectiveness among trading partners, thereby reducing

managerial costs, expediting deliveries, and producing higher service levels for the end

client (Ellram and Cooper, 1990; Simatupang and Sridharan, 2002).

The dimensions of collaboration have been widely studied in the supply chain

management literature (Heide and John, 1990; Ellram, 1991; Morgan and Hunt, 1994;

The International Journal of

Logistics Management

Vol. 29 No. 1, 2018

pp. 284-307

© Emerald PublishingLimited

0957-4093

DOI 10.1108/IJLM-09-2016-0204

Received 7 September 2016

Revised 1 February 2017

28 April 2017

19 June 2017

Accepted 20 June 2017

The current issue and full text archive of this journal is available on Emerald Insight at:

www.emeraldinsight.com/0957-4093.htm

This work was supported by the FAPESP Agency (Grant No. 2011/19271-9).

284

IJLM

29,1

Barratt, 2004; Whan et al., 2005; Min et al., 2005; Simatupang and Sridharan, 2005a,b;

Daugherty et al., 2006; Nyaga et al., 2010; Fawcett et al., 2012). Barratt (2004) and

Vieira et al. (2009) identifiedthe elements of supply chain collaborationand the main barriers

to implementation. Additionally, they emphasized the need to explore the issues of “when”

and “with whom”to collaborate, recalling the importance of supplier selection, including

meetings and relationship history, for effective collaboration implementation (Hong et al.,

2005; Min et al., 2005; Sandberg, 2007). Several authors have analyzed the impact of

collaboration on performance (Corsten and Felde, 2005; Stank et al., 2001; Krause et al., 2007;

Flynn et al., 2010;Prajogo and Olhager, 2012; Whippleet al., 2010; Simatupang and Sridharan,

2005a; Nyaga et al., 2010; Leuschner et al., 2014; Li et al., 2015) and the interaction of supply

management andperformance (Ellram and Cooper, 1990;Liao et al., 2010; Prajogo et al., 2012).

Stank et al. (2001) emphasized the role of internal and external collaboration in achieving

logistical service performance. A high frequency of regular meetings positively impacts the

buyer-supplier relationship (Min et al., 2005). Prajogo and Olhager (2012) concluded that

long-term relationships and information integrationlead to effective external integration, and

Thomas et al. (2015) investigated the impact of relationship history on negotiation strategy

expectations in long-term buyer-supplier relationships.

However, few studies investigate the interaction between logistics collaboration, supplier

selection, meetings, relationship history, and logistics performance as a unique structural

model from the perspective of the shipper-carrier-LSP logistics triad. The process by which

supplier selection and relationship history influence logistics collaboration and their

impact on performance remains unknown. The temporal element of the relationships

must be evaluated with respect to history because the relationships change over time

(Min et al., 2005). Therefore, it is important to investigate the impact of relationship history

on logistics performance.

This paper aims to evaluate the effect of logistics collaboration, meetings, relationship

history, and supplier selection on the logistics performance of shippers, carriers, and LSPs.

Considering the aspects that make up each of these concepts, we contribute to

understanding how Brazilian companies’logistics performance is affected by supply chain

relationships. For example, an excellent supplier selection process and relationship history

can positively affect logistics performance (Prajogo and Olhager, 2012; Prajogo et al., 2012;

Simatupang and Sridharan, 2005a; Leuschner et al., 2014) and offer strong alternatives for

managers to build new differential capabilities in the supply chain. Additionally, having

frequent meetings with top managers contributes to better logistics collaboration (Sandberg,

2007) and thereby contributes to improving companies’logistics performance (Vereecke and

Muylle, 2006). Because existing literature lacks research that addresses supplier selection,

meetings, relationship history, logistics collaboration, and logistics performance

simultaneously and because companies continue to have difficulty managing change, our

study has managerial implications in terms of facilitating the integration of these areas and

implementing company projects. In this way, having an appropriate supplier selection

process, regular meetings and a satisfactory relationship history between buyers and

suppliers can improve collaborative practices and thereby performance by eliminating

redundancies and necessary rework in logistics partners’routine (Stank et al., 2001).

Long-term relationships also have a strong influence on logistics performance (Prajogo and

Olhager, 2012) and in the past decade have been expanded into integration with partners

(Prajogo et al., 2012). These relationships are described as long-term and contractual in

nature, requiring investment from both partners (buyer and supplier) and implying a wide

scope of logistics activities (Lu, 2003). Then, understanding the history of the relationship

between buyers and suppliers over time can help to measure the relationship’s long-term

impact (Thomas et al., 2015). In this way, a satisfactory relationship history can contribute to

better logistics performance.

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Logistics

performance