Maritime Logistics Value in Knowledge Management

Eon-Seong Lee, Dong-Wook Song

• Publisher: Routledge
• Year: 2014
• ISBN:
  9781317682455
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Knowledge management has been widely applied to various industries as a good strategy to help improve firms' performance. As globalisation accelerates and international trade increases more and more, maritime transport operations have become one of the vitalest industries to receive large attention from international managers. This is because the managers have perceived that the maritime transport system is an integrated entity within the global logistics and supply chain, and it should be therefore managed in the most efficient and effective ways possible, as an organic body within a global logistics system.

Taking this approach, this book examines how maritime transport operators – such as shipping companies, port terminal operators and freight forwarders – could successfully play a role within the global logistics flow wherein they are embedded by improving their logistic value, i.e. maritime logistics value. As per the objective, the current book suggests a knowledge management based solution. It attempts to systematically investigate what types of knowledge are needed in the maritime logistics industry, how maritime operators could effectively acquire the knowledge, and whether the acquired knowledge would help maritime operators enhance maritime logistics value.

This book provides not only comprehensive understandings of knowledge management strategy, but also its practical application to the maritime logistics industry. This would therefore be a useful guidebook for the managers, academics, and undergraduate / postgraduate students in the field of maritime transport and global logistics, to help them to gain comprehensive knowledge of the application of knowledge management strategy to the industry.

1 Introduction

Research background

Over the last few decades, world-wide business environments have changed rapidly, affected as they have been by the wave of globalisation. Globalisation has triggered international trade between countries and quickened the growth of multinational corporations. Globalised businesses have brought about the belief that globally dispersed operations need to be managed in the most efficient and effective way for firms’ greater profit. In this sense, effectively administrating the globally linked activities of a firm – that is global logistics management – has become one of the most significant considerations of international business management. Global logistics is referred to as the entirety of activities which involve logistics flows (i.e. all the relevant activities of the flow of goods from the origin to ultimate destination, including transportation, warehousing, purchasing, distribution, etc.) in two or more nations across the globe (Council of Supply Chain Management Professionals 2007; Gourdin 2001; Sheu 2004).

The aforementioned challenges in global business have caused the maritime transport system to be seen in a way that is strategically different from those of past decades. Historically, maritime transportation was regarded as a simple and independent system which moves cargoes across the world by sea. The main required factor for the maritime transport system was to move cargoes at the lowest possible cost. Today, having experienced the aforementioned environmental fluctuations, the traditional view of the maritime transport system has shifted. The new recognition dominant in global business management is that the maritime transport system is a component of globally inter-linked logistics functions, and offers integrated logistics services, including carrying goods by ocean (Mason & Lalwani 2004). Such a view has given rise to the use of the ‘maritime logistics’ concept (Panayides 2006), which reflects on both the traditional and currently required logistical role of maritime transportation.

Maritime logistics is referred to as the process of planning, implementing and managing the movement of goods and information which is involved in ocean carriage. The principal aim of a maritime logistics system is to enhance the value of the system (i.e. maritime logistics value). The maritime logistics value can be maximised when the maritime operators offer quick, responsive, flexible and reliable services at a lower price. Greater maritime logistics value may contribute to the improvement of the entire logistics performance, as well as the competitive advantage of maritime operators themselves. Therefore, maritime logistics value has become one of the most significant strategic goals that maritime operators (e.g. shipping and port) want to achieve and sustain for their long-term competitiveness.

Along with the increasing attention paid to the maritime business as indicated above, maritime studies have also made a remarkable development. The studies examine the determinants of successful integration of maritime transport into global logistics, and its effectiveness (Bowersox 1978; Narasimhan & Jayaram 1998; O’Leary-Kelly & Flores 2002; Panayides & Song 2008); the importance of maritime logistics (Panayides 2006); strategic alliances of maritime operators (Frankel 1982; Brooks 2000); issues of safety, security and environment in maritime logistics (Gaarder, Rongnstad & Olofsson 1997; Soares & Teixeira 2001; Li & Zheng 2008); and the efficiency and competitiveness of port/terminal (Cullinane, Song & Gray 2002; Tongzon & Wu 2005; Yeo & Song 2006).

The above studies contribute to the comprehensive understanding of the strategic significance of maritime transport within the context of global logistics. However, little research has been done to clarify how maritime operators improve maritime logistics value, in order to achieve their strategic objective from a strategic management perspective in a systematic way. This book, on the basis of the most influential theories in logistics and strategic management, identifies that a knowledge-based strategy will be the most desirable alternative. The reason for this argument may be due to the fact that existing literature ensures that the knowledge management strategy can help firms to improve their operational efficiency (i.e. cost and time) and service effectiveness (i.e. flexibility, responsiveness and reliability in services). Thus, it could be expected that maritime operators can maximise maritime logistics value by successfully implementing knowledge management strategy.

Research objective and research questions

The question here is how maritime operators successfully apply the knowledge management strategy in order to accomplish their strategic goals. Unfortunately, existing literature has yet to clearly define a way to apply the knowledge management strategy to maritime operations, nor has it determined the effectiveness of the strategy in enhancing maritime logistics value in a systematic manner. The current book aims to fill this research gap. Namely, this research aims at empirically examining the process of applying a knowledge management strategy to maritime operations, and diagnosing whether the knowledge management strategy could really be a good strategic alternative towards the improvement of maritime logistics value. These research objectives address the following research questions (RQs):

RQ1: How could maritime operators acquire the knowledge for maritime logistics value?

RQ2: How could the acquired knowledge improve maritime logisticsvalue, and is knowledge management strategy a desirable strategicalternative for maritime operators, in order for them to improve maritimelogistics value?

Theories and practices of maritime logistics and strategic management literature, such as social network embeddedness perspective, organisational learning theory and co-opetition perspective, are adopted as per the objectives.

Research methodology

A literature review of the work of maritime logistics and strategic management theories is initially performed in order to identify the relevant academic streams of the research issue of this study. The theoretical review clarifies the strategic objective of maritime operators, and conceptually outlines the method of how maritime operators acquire knowledge and enhance maritime logistics value. This research eventually leads to the development of a conceptual framework that shows the positive relationship between knowledge acquisition and maritime logistics value, and the role of social network embeddedness of maritime operators in acquiring knowledge.

In order to empirically investigate the proposed conceptual relationship, this research employs a qualitative approach: an explorative case study and the Delphi survey method. The purpose of the case study is to explore some contextual phenomena and to validate the proposed relationships in the maritime logistics field. The explorative case study utilises an in-depth interview method with a semi-structured questionnaire. The interviews were conducted from April to May 2008 in Korea. The researcher went to the interviewees’ companies to meet them, and all of the interviews were conducted on a face-to-face basis. A total of nine cases of maritime logistics companies in Korea were used for the explorative analysis.

Two rounds of the Delphi survey, which is an empirical method that is used to get information from experts on the research topic, are then conducted. Since the Delphi survey method allows one to collect the professional views of a panel of experts in the maritime logistics industry, the method may enable us to understand and diagnose the present status of the relationships assumed in the conceptual model in a more accurate and reliable manner.

A questionnaire for the survey is formulated based on construct operationalisation and five-point numerical measurements on key variables. The quality of the Delphi survey method is evaluated by assessing the validity and reliability of the method. Subsequently, qualified panellists are selected on the basis of certain criteria to stand as experts in the Korean maritime logistics industry. After conducting a pilot test on each question, the first round of the survey is launched. In the first round, the finally developed questionnaire is distributed to the panellists, and their responses are then collected. The collected data in the first round of the survey are initially summarised by calculating ‘mean values’ and ‘standard deviations’.

Once the above is complete, the second round of the survey is launched. The questionnaire is re-sent to the panels, along with information of the collective views of the first round of the survey (i.e. the summary with the mean values and standard deviations), and is then re-collected. The purpose of attaching the collective views in the second round is to give respondents the opportunity to reconsider their previous answers, based on the group opinions answered by the other panels as a whole. After this, the conceptual relationships are examined by analysing the responses finally collected, and the propositions that are relevant to the empirical findings are suggested. Finally, strategic implications are discussed in the last part of the book.

Research scope

This book is primarily concerned with the strategy of maritime logistics operators. Maritime logistics operations consist of shipping, port operation and freight forwarding. Thus, the unit of analysis in this study is the individual firms which comprise shipping lines, port terminal operators and freight forwarders.

The regional context of this study is the Korean maritime industry, as the geographic and strategic importance of the industry as a key Asian logistics centre has increased in recent years. Thus, the empirical investigation which is targeted at Korean maritime operators may derive meaningful strategic implications in maritime logistics research.

Book structure

The book consists of a total of eight chapters. Figure 1.1 depicts the chapter structure of this book. Chapters 2 to 4 review the theoretical background and introduce the theoretical significance of maritime logistics, maritime logistics value and knowledge management strategy.

Chapter 2 reviews the definitions of logistics and global logistics, and the role of maritime transportation within the context of global logistics integration. Chapter 3 introduces the concept of maritime logistics and the process of creating maritime logistics value. In this chapter, the strategic goal of maritime operators (i.e. the improvement of maritime logistics value) is clarified, and the quest for a new strategic direction for maritime operators is assured. Chapter 4 reviews strategic management theories in order to explore which theory or practice would be the most helpful in solving the current strategic task of maritime operators. Key strategic theories (e.g. knowledge-based perspective, social network theory and co-opetition strategy) are chosen and elaborated on in this chapter.

Chapters 5 to 8 present the research methodology and the results of the empirical findings. Chapter 5 examines aspects of the research methodology behind this book. In this chapter, a theoretical conceptual framework is developed by exploring the relationship between key concepts and theories on the topic. After then discussing methodological issues of research (i.e. the philosophy, logic and research method), an appropriate research method for this study is justified and chosen. Finally, an analytical process of this work is designed, and the quality of the chosen method is diagnosed through assessment of the validity and reliability of the method.

Figure 1.1 Book flow chart.

In Chapter 6, an explorative case study is performed in order to identify whether the patterns which are assumed in the theoretical model substantially occur in the maritime logistic field. This chapter introduces the explorative case study design, briefs the process of the case study conducted in this study and summarises the findings of the intervie...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of figures
• List of tables
• Preface
• List of abbreviations
• 1 Introduction
• 2 Global logistics
• 3 Maritime logistics and operators
• 4 Review of strategic management theory
• 5 Research methodology
• 6 Explorative case study on maritime operators
• 7 The Delphi survey on maritime operators
• 8 Implications and conclusions
• Appendices
• Index