Operational collaboration between shippers and carriers in the transportation industry

Abstract

PurposeThe purpose of this paper is to develop a better understanding of how strategic relationships between firms and environmental context affect operational decisions and how each firm allocates resources to improve overall firm performance.Design/methodology/approachQualitative research is integrated with previous research. Data for the qualitative research are collected through focus groups and semi‐structured interviews that employ grand tour questioning, facility tours using key informants, and use of selective artifacts.FindingsThe paper develops a model that examines how environmental factors, specifically the context of the capacity constraints in the transportation industry, can influence shippers to form long‐term and mutually beneficial relationships with their carriers and how these relationships can lead to improved performance at the operational level.Research limitations/implicationsThe paper incorporates five foundational theories into one integrated model in the context of business‐to‐business transportation collaboration. The specific contributions from this model most likely cannot have been derived by adopting only one or two of these theories, and this paper provides only one context within which these theories can be integrated. Future research should focus on areas of incompatibility and compatibility among these foundational theories. With this understanding, theory integration should spur future research by attempting to evaluate the nature of business systemically and holistically.Practical implicationsThough collaboration and relationship management has received much attention, realizing improvements in firm performance has proven difficult. Once collaborative behaviors between shippers and carriers are established at a strategic level, managers must carefully assess how to drive those collaborative behaviors to the operational levels of each firm.Originality/valueThis paper extends previous supply chain relationship research, which primarily focuses on strategic interactions between firms, by focusing on the context in which they are carried out. It integrates managerial insights with foundational theories from marketing, logistics, and operations to create theory of how supply chain relationships facilitate firm decisions regarding allocation, sharing, and management of resources on an operational level.

Slow steaming impacts on ocean carriers and shippers

“…Some maritime industry executives are already pushing for a relational shift for shippers and carriers to maintain more collaborative mindsets to form stronger working relationships to address recurring, detrimental industry challenges like overcapacity and carrier profitability (Burnson, 2011;Leach, 2011f ). However, the bulk of the academic collaboration research has focused on buyers and suppliers with minimal attention to carriers and shippers (Fugate et al, 2009), thus presenting a significant opportunity for future research to support collaborative carrier-shipper innovations like slow steaming. For instance, qualitative research methods such as grounded theory could lead to better understanding of managerial responses to slow steaming as well as carrier-shipper interactions in contractually negotiating a satisfactory share of slow steaming benefits.…”

“…Fugate et al (2009) describe the potential success for collaboration in the transportation industry as weak but use qualitative evidence to demonstrate examples in motor carriage (for example, consistent routings and schedules, drop-and-hook operations, trailer standardization, dock re-design, and synchronization of production and shipping). More specifically to maritime, despite the vital role of ocean carriers within global supply chains, relationships between carriers and shippers have traditionally been characterized by complexity and a lack of transparency (Leach, 2011b).…”

Improving road transport operations through lean thinking: a case study

“…Thus, when mapping a supply chain, unnecessary transportation becomes an important waste to identify, measure, and eliminate. According to Fugate et al (2009) and McKinnon et al (1999), unnecessary transportation problems and waste can be addressed by increasing the efficiency of transport operations. In this context, Hines and Taylor (2000) proposed a methodology, consisting of four stages, to increase efficiency and eliminate waste in transport operations.…”

“…According to Ak and Erera (2007), one of the most compelling reasons for this is that the large majority of these approaches, and in particular vehicle routing models, are oversimplified by treating parameters such as demand, time, distance, and others, as deterministic, when in real life scenarios they are stochastic in nature. In addition, the improvement of actual road transport operations and activities to gain efficiency is rarely considered under the mathematical modelling, operations research, and simulation methods (Fugate et al, 2009). …”

Liner Shipping Fleet Deployment with Sustainable Collaborative Transportation

“…Zhou et al proposed two collaboration modes and used a simulation methodology to obtain the optimal dispatching plan for shippers [51]. In addition, although several papers mentioned the conception of liner alliances [52][53][54][55], few studies proposed how to proceed with the shipping collaborative transportation [56][57][58][59][60]. Although Agarwal and Ergun designed a shipping service and provided the collaborative mechanism, the model is hard to practically apply due to its complexity.…”