Drivers of logistics service innovation in Third Party Logistics business

Abstract

The desire to focus on the company's core business processes has impacted companies to outsource their logistics activities to Third Party Logistics (TPL). These conditions create the demand for logistics services so that the TPL business grows significantly. Service innovation from TPL holds a critical role in the development of logistics business clusters because TPL is a new growth source from the regional and national economy. What factors drive TPL business to innovate has not been much studied in the logistics research literature. Few studies have addressed drivers of logistics service innovation. Deficiency of empirical research on the drivers of logistics service innovation in TPL business, so that this paper study empirical studies on the factors that influence innovation in TPL business. This study aims to identify the factors that drive innovative logistics services from TPL business so that they can provide the basis for developing innovation in TPL. Content analysis of extant literature was conducted. This study found that a lot of knowledge about innovation drivers in TPL was identified in theoretical based, but many of these components were not implemented yet. This study shows that TPL will achieve successful operational performance if innovation is executed with suitable knowledge management so the TPL can achieve effective communication networks.