Abstract
PurposeThe purpose of this paper is to provide new insights into the reactions and lessons learned with regard to the COVID-19 pandemic in terms of how logistics service providers (LSPs) managed to maintain supply chains resilience and what focus areas have been changed to keep operations functional and uphold financial stability.Design/methodology/approachBased on data-gathering techniques in interpretive research this study collected primary data via semi-structured interviews, interviewing informants from selected LSPs that operate on a global scale.FindingsThe results show that LSPs have built their reactions and actions to the COVID-19 outbreak around five main themes: “create revenue streams,” “enhance operational transport flexibility,” “enforce digitalization and data management,” “optimize logistics infrastructure” and “optimize personnel capacity.” These pillars build the foundation to LSP resilience that enables supply chains to stay resilient during an external shock of high impact and low probability.Originality/valueThe results of this study provide insights into how LSPs have managed the downsides and found innovative ways to overcome operational and financial challenges during the COVID-19 outbreak. As one of the first studies that specially focuses on the role of LSPs during the COVID-19 pandemic, this study categorizes the LSPs’ reactions and provides a “lessons learned” framework from a managerial perspective. From a theoretical perspective, this paper discusses the strategic role of LSPs in supply chain management and thereby extends current supply chain literature with a focus on LSP resilience.
Highlights
This has been the most difficult shipping environment for supply chain and logistics professionals in our observed history (Jaap Bruining, Head of Europe, Coyote Logistics on 31 July 2020).The COVID-19 outbreak in the beginning of 2020 caused an unparalleled disruption of supply chains, clearly showing the vulnerability of the globalized economy which is characterized by complex and intertwined product and material flows (Ivanov and Dolgui, 2020b; Queiroz et al, 2020; Singh et al, 2020)
The paper presents and discusses the immediate actions of the mainly operational decisions taken by logistics service providers (LSPs), thereby providing an overview about the real-world reactions of LSPs and their impact on supply chain resilience
We used an interpretive research approach using primary data from interviews with LSPs and secondary data to showcase operational decisions and specific actions based on our LSP resilience framework
Summary
This has been the most difficult shipping environment for supply chain and logistics professionals in our observed history (Jaap Bruining, Head of Europe, Coyote Logistics on 31 July 2020).The COVID-19 outbreak in the beginning of 2020 caused an unparalleled disruption of supply chains, clearly showing the vulnerability of the globalized economy which is characterized by complex and intertwined product and material flows (Ivanov and Dolgui, 2020b; Queiroz et al, 2020; Singh et al, 2020). Stressed that global supply chains and the associated complex material flows predominately rely on logistics infrastructure (mainly transport and warehouse services) provided by logistics service providers (LSPs). A 2019 LSP study (Infosys, 2019) revealed that 53% of shippers’ transportation and 34% of warehousing operations expenditure is related to logistics outsourcing, with supply chain consultancy Gartner (2019) expecting further budget increases for logistics outsourcing in the upcoming years. By coordination and managing material flows, LSPs have a significant impact on supply chain resilience by limiting or even eliminating risks that may occur owing to volatile demand, supply or in emergency situations (König and Spinler, 2016)
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