Performance management in supply chains: logistics service providers' perspective

Abstract

Purpose Logistics service providers (LSPs) are important actors for creating logistics performance in supply chains. However, there is little previous research on how they handle the performance management process. The purpose of this paper is to explore the handling of the performance management process and its obstacles from the perspective of LSPs. Design/methodology/approach A multiple‐case study is conducted with the three largest LSPs in Sweden. Findings The handling of the performance management process shows similarities among LSPs in selecting performance variables, defining metrics, and capturing real‐time data. The differences are found in target setting, in report‐making and analysing, and in the perceived demand for performance management. The following three perceived obstacles are found for supply chain performance management: lack of understanding and knowledge; poor capabilities for adapting performance metrics definitions; and lagging IT solutions for performance report ‐ making. The findings indicate possibilities for an increased supply chain scope where activities are handled by the partner that has the best capabilities, improving efficiency in supply chains. Research limitations/implications The study contributes to performance management theory by providing exploratory knowledge of the supply chain performance management process and its obstacles from the perspective of three LSPs. The study focuses on large LSPs and has respondents at the managerial level. Practical implications The study reveals differing supply chain performance management practices among LSPs, which implies that customers can choose an LSP that handles performance management in the way required. Originality/value Little previous research includes LSPs in studies of supply chain performance management. In particular it is unusual to have the perspective of LSPs and apply case‐based methodology.