Innovation-oriented dynamic capabilities of logistics service providers, dynamic resilience and firm performance during the COVID-19 pandemic

• DOI: https://doi.org/10.1108/IJLM-01-2021-0059
• Published date: 05 January 2022
• Date: 05 January 2022
• Pages: 499-519
• Subject Matter: Management science & operations,Logistics
• Author: Irina Dovbischuk

Innovation-oriented dynamic

capabilities of logistics service

providers, dynamic resilience and

firm performance during the

COVID-19 pandemic

Irina Dovbischuk

IU International University of Applied Sciences, Bremen, Germany

Abstract

Purpose –The purpose of this paper is to use a theoretical framework to investigate the relationshipsbetween

different innovation-oriented dynamic capabilities, dynamic resilience and firm performance among logistics

service providers (LSPs) and in-house logistics departments of industrial companies during the coronavirus

disease 2019 (COVID-19) pandemic.

Design/methodology/approach –The conceptual theoretical framework relies on the dynamic capabilities

framework (DCF) and the relational view (RV), which are rooted in the resource-based view (RBV). It is

hypothesized that the dynamic capability to innovate reinforces the dynamic capabilityto adapt and to recover

in highly dynamic and vulnerable environments during the pandemic. This allows LSPs to successfully create

new services and respond to the changing market circumstances in terms of logistics service quality (LSQ) and

firm performance. Data were collected from 83 LSPs and 30 in-house logistics departments via an online

survey. The study determined the general strength and direction of the relationships between latent variables.

A correlation analysis was utilized to establish statistical significance of the results.

Findings –In this study, a range of innovation-oriented capabilities for achieving more dynamic resilience

were bundled in a conceptual framework and were found to be statistically significant for LSQ and firm

performance. They are the capability to distribute new knowledge, to train employees effectively, to develop

cross-functional collaboration within the firm, to develop inter-firm relationships with business partners on a

long-term basis as well as to learn from rivals, and to pursue a win-win relationship with them.

Research limitations/implications –The results of the study do not imply that the identified capabilities

are the only ones relevant to increasing dynamic resilience during the pandemic. In October 2020, the COVID-19

pandemicwas at different stages in different countries, so that the level to which firms were affected varied, and

although the data were collected during one month only, due to the high dynamics of the pandemic, data were

collected during different stages of disruptions, even among respondents in the same country. This study was

set in the context of COVID-19,and it could not be proved whether the conceptual framework is generalizable to

other crises or particular industries, but it would be worthwhile to examine this in the future. Finally, it was not

tested whether LSQ mediates therelationship between innovative capabilities and firm performance during the

pandemic.

Practical implications –The results help managers with regard to their strategic and operational decisions

in relation with COVID-19. These findings are useful for executives and logistics managers to improve these

capabilities to gain a competitive advantage during pandemic and to find their strengths and weaknesses to

Dynamic

resilience

capabilities

499

© Irina Dovbischuk. Published by Emerald Publishing Limited. This article is published under the

Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and

create derivative works of this article (for both commercial and non-commercial purposes), subject to full

attribution to the original publication and authors. The full terms of this licence may be seen at http://

creativecommons.org/licences/by/4.0/legalcode

This paper forms part of a special section “Resilient supply chains through innovative logistics

management”, guest edited by Peggy S. Chen and Jiangang Fei.

The author would like to thank two anonymous reviewers for their invaluable suggestions which

helped to improve the manuscript immensely and Waqas Ali for his help with the data collection for this

research.

Open Access publication enabled by IU International University of Applied Sciences.

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

https://www.emerald.com/insight/0957-4093.htm

Received 30 January 2021

Revised 9 June 2021

4 October 2021

Accepted 17 November 2021

The International Journal of

Logistics Management

Vol. 33 No. 2, 2022

pp. 499-519

Emerald Publishing Limited

0957-4093

DOI 10.1108/IJLM-01-2021-0059

develop critical capabilities for situations with a high turbulence and dynamic in their environment, and

therefore provide a path for improvement.

Originality/value –This paper operationalizes a multi-theoretical conceptual framework in the context of

logistics management (LM) and supply chain management(SCM). This conceptual framework was empirically

tested.

Keywords COVID-19, Dynamic capabilities framework, Firm performance, Innovation, Logistics service

providers, Relational view, Resilience

Paper type Research paper

1. Introduction

The coronavirus disease 2019 (COVID-19) pandemic has been hitting the business world at

an unprecedented scale and speed (International Monetary Fund, 2020;Choi et al., 2020;

Ivanov and Dolgui, 2020): the stoppages of factory outputs, the closures of business and the

disruptions to global supply networks occurred first in China and affected global supply

chains across the whole world at the beginning of 2020. As a result of the multiple waves of

the COVID-19 pand emic, many original equipment ma nufacturers in different indus tries

and their corresponding supply networks are suffering from permanent unpredictable

disruptions. The pandemic reminded the business decision-makers of the importance of

widening firm performance measures to include resilience, responsiveness and

reconfigurability (Betti and Ni, 2020). The COVID-19 pandemic underlined not only the

weaknesses of global supply chains that are trimmed for efficiency, minimized inventory,

lean manufacturing or single sourcing strategies (Lin and Lanng, 2020)butalsothe

importance of the resilience concept (Choi et al., 2020) and of innovative solutions to

improve logistics service quality (LSQ) (Wang et al., 2020a).

Organizational innovation has been recognized as a significant driver to cope with volatile

business environments, because logistics service providers’(LSPs’) organizational

innovation enables them to develop new and unique services as a basis for non-imitable

and long-term competitive advantage (Chapman et al., 2003;Grawe, 2009). The empirical

study by Wang et al. (2020b) on logistics innovation capability, based on the resource-based

view (RBV), demonstrated the applicability of these capabilities for mitigating supply chain

risks. This study addresses the RBV’s shortcoming on logistics innovation capability, which

assumes a static set of resources. The environment during the pandemics is not static, but

dynamic, with frequent changes and disruptions. Furthermore, this study combines the DCF

with the RV to answer the call for more middle-range theorizing in LM (Stank et al., 2017, p. 15;

Craighead et al., 2016, p. 246; Pellathy et al., 2018). Applying middle-range theorizing, this

study seeks to explain phenomena unique to supply chain management (SCM) and logistics

management (LM) by focusing on the specific mechanisms of creating innovation-oriented

capabilities that strengthen resilience, improve LSQ and firm performance within the

particular context of the COVID-19 pandemic.

Although there are several empirical studies on the mechanism of creating innovation-

oriented capabilities with the help of customers (Chapman et al., 2003;Wagner and Sutter,

2012;da Mota Pedrosa et al., 2015), buyer–supplier relations (Ivan Su et al., 2011) or the

synergetic effect of innovation interactions between firms (Wang et al., 2020c), there is very

limited research on the role of inter-firm resources for LSPs’innovation-oriented capabilities

or how these capabilities can be applied to absorb the impacts of the COVID-19 pandemic and

to recover to a better state (dynamic recovery). In addition, although horizontal cooperation or

collaboration between competitors has enjoyed great significance and wide application in

LSPs for years (Wallenburg and Sch€

affler, 2016;Brandenburger and Nalebuff, 2021), the LM

and SCM literature has not paid much attention to the role of inter-firm resources during the

pandemic period (Kilpatrick and Barter, 2020).

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