Digitization policy design and implementation in the logistics and supply chain sector during the time of Covid-19

Abstract

Purpose - The border closure and lockdowns due to Covid-19 pandemic resulted in partial closure of many industrial and commercial complexes, halted the performance of key strategic sectors such as logistics and supply chains, and thus disrupted the global value chains and the economy. The authors argue, however, that the pursuit of survival has driven companies to innovate and use digitization to overcome the negative consequences of the pandemic. More specifically, in this paper the authors aim to assess the success and challenges faced by companies in digitization policy design, adoption and implementation and their effects on firms' operation, outputs and customer base during Covid-19. Design/methodology/approach - Sixty-one samples of the companies surveyed between 10 January and 30 April 2021 were analyzed, using the Krushkal-Wallis test and Independent-Samples Mann-Whitney U test to identify the relationships between variables including operation, overall output, customer base, digitization policy, technology use and implementation costs of new technologies. Findings - Results revealed a positive impact of digitization on the operation and overall outputs, while no effect was observed on the customer base. Analysis also showed that only 1.8% of companies were able to fully implement digitization, and that the cost of technology prevented most companies from using emerging technology or implementing their digitization policy. Research limitations/implications - While the research has practical implications, it is not without flaws. For instance, the outcome of technology varies as per geographic area and people. The study was conducted in the Sultanate of Oman, a developing country in the Middle East region; therefore, it is difficult to generalize the outcomes suited to developed countries. The developed countries usually have a population quite used to the advanced technologies so some of the issues raised in the study might not work in the logistics and supply chain sectors of the developed countries. Such countries need separate studies. Practical implications - The findings will have implications for both supply chain companies as well as the technology providers. The supply chain companies will invest in technology infrastructure and add technology as an important component in their business models. The technology providers will consider the costs of implementation and adoption issues of technology in the supply chain companies. Originality/value - To the best of authors' knowledge, no work has been produced on logistics and supply chain companies considering the technological sustainability during the time of Covid-19. The study will improve understanding of the digitization policy design, adoption and implementation and their effects on logistics and supply chain companies' performance.