Innovative capabilities and competitive advantage in the era of industry 4.0

What is it about?

To stay competitive in facing stiff competition, trucking companies need innovative capabilities. While much works related to innovative capabilities have been published in various sectors, we barely find any that specifically address trucking industry, especially in the era where the advancement of emerging technologies provide both opportunities and challenges. This paper investigates factors affecting the innovative capability of the trucking companies and how this innovative capability influences competitive advantage in the era of industry 4.0. The data of 423 respondents are gathered from a survey of trucking companies in Indonesia. Five hypotheses were developed and tested using partial least squares - structural equation modelling (PLS-SEM). The result reveals that technology capability and market orientation significantly affect innovative capability. On the other hand, innovative capabilities of trucking companies do not seem to be affected by their relationships with suppliers. The innovative capability significantly affected the trucking company’s competitive advantage, but industry 4.0 does not moderate this impact. The finding provides helpful insights for managers and serves as interesting triggers for further research.

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Photo by Seb Creativo on Unsplash

Photo by Seb Creativo on Unsplash

Why is it important?

Many studies related to innovative capability have been carried out in the manufacturing industry, but only a few in the service industry. In services such as in logistic service provider, we found six studies. As part of logistics, in transportation, a few addressed innovative capability in the maritime sector and the public transportation. None of the previous studies studied innovative capability in the trucking industry.