A qualitative investigation of innovation between third-party logistics providers and customers

Despite the challenges of creating innovation in third-party logistics (TPL) provider-customer relationships, little is known about how TPL providers and customers engage in joint innovation projects and the benefits that can be obtained from such innovation activities. Therefore, this exploratory study investigates contingency factors that are important in joint TPL provider-customer innovation projects, and the project outcomes for TPL providers and TPL provider-customer relationships. The study applies a multiple case study research design to examine four TPL provider-customer innovation projects. Cross-case analysis reveals that several contingency factors (e.g., high integration with customer, establishing links to customers insisting on new services, complementary relationship-specific investments, agreement of benefit sharing) influence the joint TPL provider-customer innovation projects. Furthermore, the analysis shows that such innovation projects allow the TPL providers to upgrade their positioning, intensify customer relationships and lead to higher performance. Furthermore, this research underlines that innovation in logistics services can be a source of sustainable competitive advantage for TPL providers. (C) 2012 Elsevier B.V. All rights reserved.