Journal of Business Research 94 (2019) 400–407

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Journal of Business Research

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A knowledge management and sharing business model for dealing with T

disruption: The case of Aramex
⁎
Larissa v. Alberti-Alhtaybata, , Khaldoon Al-Htaybatb, Khalid Hutaibatc
a
King Abdulaziz University, PO Box 80200, 21589 Jeddah, Saudi Arabia
b
King Abdulaziz University, Jeddah, Saudi Arabia
c
Mutah University, Karak, Jordan

A R T I C L E I N F O A B S T R A C T

Keywords: The current study investigates the global logistics player Aramex and how it deals with disruptive technologies.
Aramex In particular, it focuses on the unique business model that the case organisation has adopted and that allows for
Business Model disruption to be managed through collaborative knowledge management. The study is qualitative and uses
Asset-Light video, document/text and interview material for the case organisation. Data was analysed in two coding stages
Agile
to derive at the categories/themes that have the most explanatory power. Aramex, a global logistics providers
Disruptive Technologies
originating from the Middle East, is utilised to illustrate their business concept that determines and permeates
Knowledge sharing and management
their organisational culture. Disruptive technological innovations, such as Big Data Analytics, new hardware,
smart apps that can connect individuals to the corporation in different contexts, feature strongly, to manage their
collective knowledge of innovation and value creation. Disruption is embedded in their business model and an
important part of their business operations.

1. Introduction
Disruptions are considered destructive and creative at the same time
(Christensen, 1997) as disruptive, or disturbing, companies literally
turn an industry upside down and change it profoundly and perma-
nently. The most well-known and significant examples are well-estab-
lished household names, such as Google and Apple, and newcomer that
have changed their industries significantly, such as Uber and AirBnB.
The current study illustrates the case of Aramex, a Middle Eastern
global logistics player that has adopted a unique business model, set to
disrupt the logistics industry at the onset. The current study is part of a
broader research project on Aramex, investigating novel management
and accounting developments in the age of new technologies, disrup-
tion and innovation-driven change. The most recent development is
their shift from delivery to solutions provider, including storage of a
variety of assets, such as data for instance, thus engaging in distributed
knowledge management. They strongly rely on local connections and
providers to manage and expand their business in different locations,
and they significantly utilise technology to their advantage to connect
their potential and existing service providers and customers. Their most
recent motto, as identified by Hussein Hachem, current CEO of Aramex:
‘We are going to disrupt the logistics industry’ (Hussein Hachem, An-
nual Leadership Conference, 2016). Their business model was adopted
because they wanted to run a logistics company but lacked the financial
resources to establish a logistics fleet. Their model's agility, resistance
and ability to adapt to and adopt new business practices is unique in the
logistics industry. They engage in disruptive technologies and dis-
ruptive developments that are on the brink of altering the logistics in-
dustry permanently. Their model is based on their collective knowledge
of how to run logistics operations without heavy asset investment,
combined with new technologies, such as a collaborative platform akin
to Uber, that connects providers and customers. It reflects their
knowledge acquired over the past thirty-five years of how to in-
corporate innovation and new forms of doing business within the lo-
gistics industry to create a sustainable competitive advantage. Innova-
tion has long played an important role in the logistics industry
(Germain, 1996), and incorporating innovation in the business model
can significantly enhance value creation (Bouncken & Fredrichs, 2016)
and agility and dynamism (Ricciardi, Zardini, & Rossignoli, 2016).
The logistics industry is renowned for its progressive use of tech-
nology and integration of different practices, concepts, artefacts and
competences (Derwik, Hellstroem, & Karlsson, 2016; Gunasekaran,
Subramanian, & Tiwari, 2016). With regard to disruptive technologies,
the area is still under-researched, although significant changes are ex-
pected to take place (Hofmann & Rüsch, 2017). The successful im-
plementation of new and disruptive technologies in the logistics sector

⁎
Corresponding author.
E-mail address: lalberti@kau.edu.sa (L. v. Alberti-Alhtaybat).

https://doi.org/10.1016/j.jbusres.2017.11.037
Received 15 August 2017; Received in revised form 25 November 2017; Accepted 28 November 2017
Available online 08 December 2017
0148-2963/ © 2017 Elsevier Inc. All rights reserved.
L. v. Alberti-Alhtaybat et al.
is considered one of the foundational stones of the successful Internet of
Things (IoT) and Internet of Services (IoS) establishment (Hofmann &
Rüsch, 2017). Innovation and innovative disruptive technologies lead
to smart solutions in the logistics sector, which provide organisations
with a leading competitive advantage (Witkowski, 2017). The IoT is
expected to significantly enhance supply chain operations, and big data
analytics allow for customer and competitor analysis that help organi-
sations determine risk elements in the supply chain (Witkowski, 2017).
Technological developments, such as IoT and Big Data analytics,
characterise Industry 4.0 or the Fourth, the Digital, Industrial Revolu-
tion (Witkowski, 2017). However, research on the Digital Industrial
Revolution and its impact on the logistics sector in particular, is still in
its infancy (Hofmann & Rüsch, 2017), thus prior studies call for further
investigations highlighting particular cases, concepts and practices of
dealing with the Digital Revolution and disruptive technologies
(Kothman & Faber, 2016). In general, the technologies that are con-
sidered the most disruptive by the logistics industry are IoT, driverless
cars, drones, and 3D printing (Kothman & Faber, 2016). The current
study seeks to contribute to the gap of missing empirical studies by
illustrating the case of a global logistics solutions provider that actively
deals with disruptive technologies and disruption in their daily business
activities, and that has geared its business model towards dealing with
such disruptions.
In a bid to creating, increasing and extending their competitive
advantage in relation to its competitors, logistics organisations have
followed different approaches and tactics in their operations. The large
providers, such as DHL, FedEx and UPS, have acquired whole fleets,
comprising ships, planes and land-based vehicles, which allow control
over the entire supply chain but require significant financial invest-
ment. Smaller organisations may establish themselves through largely
remaining localised, taking over national deliveries or providing third-
party outsourcing services to larger distributers, however do not grow
beyond a certain national level. For one, Aramex is illustrated in the
current study as exemplary for how disruptive information technologies
can be incorporated and can be leveraged to significantly enhance and
improve the customer's delivery experience. ‘Our current focus is the
B2C, as this is where we need to improve, especially as e-commerce is
expected to grow significantly in our core markets, MENA and South-
East Asia’ (Hussein Hachem, CEO of Aramex, Bloomberg Interview).
Aramex's case is unique based on its distinguished business model and
their current organisational mission to become the ‘Uber of the logistics
industry’. Founded in 1982 by Fadi Ghandour and an American as-
sociate of his, Aramex has its roots in Jordan, although they have
moved their headquarters to Dubai several years ago. Aramex adopted
its model from the onset but in the current context of technological
developments, such as big data analytics (BDA), smart digital applica-
tions, growing e-commerce platforms and technological innovations,
such as drones and driverless cars (Manyika et al., 2011), transpired as
most suitable to address these new factors that ‘currently disrupt the
logistics industry’ (Hussein Hachem, CEO Aramex, Bloomberg Inter-
view 2017). Disruptive technologies play an important role in Aramex's
daily operations, to the extent that they have established a disruption
department that engages with existing and potential disruption features
in the logistics industry, allowing Aramex to consider the options and
possibilities. For instance, because of BDA analysis, a form of disruptive
technology, they gained a more detailed understanding of their cus-
tomer base, and based on the analysis of their customers' previous de-
livery history incorporated real time delivery predictions. Thus, they
leveraged big data analytics in order to get a better understanding of
their customers (Wamba, Akter, Edwards, Chopin, & Gnanzou, 2015),
and rendered important insights regarding their customer base. The
business model that allows for incorporating such developments in an
easy and fluid manner is built on the concepts of asset-light, agility,
value creation, leveraging strategic partnerships and disruption through
technological innovations.
The fusion between analysing and focussing on an organisational
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Journal of Business Research 94 (2019) 400–407
competitive advantage, new technological innovations, in particular the
IoT, or more broadly Internet of Everything (IoE) (Maney, 2013), and
the organisational mindset, is illustrated and analysed to draw broader
conclusions for the wider business and academic community. Techno-
logical innovations are more wide-spread in their development, as more
industries take advantage of automation and digitisation (Mishra et al.,
2016). The logistics industry has been at the forefront of incorporating
the notion of the Internet of Everything (IoE) in its operations
(Gunasekaran et al., 2016; Mishra et al., 2016), which, amongst others,
gives rise to a significant amount of data, Big Data essentially, that can
be leveraged for defining competitive advantage, but more importantly
for understanding the organisation's ecosystem that it is part of and to
create a holistic picture for planning, controlling and decision-making.
For instance, Aramex has adopted an Uber-like approach, creating an
app that allows anyone to join as a driver that underwent training, in
order to utilise an individual's spare capacity, rather than hiring a full-
time member of staff. Similarly, new technologies that are expected to
alter the transportation business significantly are considered on their
part. Aramex considers disruption to be part of its DNA (Hussein Ha-
chem, Annual Leaders Conference 2016), and in line with Accenture's
CEO Nanterme, are able to lead in chaos in a very focussed and reliable
manner. The current study seeks to illustrate their approach to logistics
and their mindset regarding disruptive technologies, which is reflected
in their particular business model, in the context of the theory of dis-
ruption (Christensen, 1997). This theory has multiple interpretations
and applications but at the core particular elements remain stable, such
as the disruptive innovation is cheaper than the market, it is more ac-
cessible and underlying the innovation is a disruptive business model
(Denning, 2016). However, some of the conceptions are challenged, as
disruptive innovators take on all segments of a market (Wessel, 2016),
challenging and changing the rules of the game, introducing not only
new innovative products and/or services but also a new lifestyle con-
cept and a redefinition of well-established, unsuspecting markets. While
Aramex initially entered the delivery market providing a delivery ser-
vice, thus not introducing a new service as such, but the way they en-
gaged in this business was profoundly different to its immediate com-
petitors. They then proceeded to introduce novel and disruptive
services and concepts that altered their core markets permanently.
However, they also recognise their disruptive potential competitors, the
business models and technological innovations that could alter the lo-
gistics industry radically, and seek to incorporate these in their business
model and operations. Technology, in that sense, is the game changer
that allowed them development in an unprecedented manner in a
market that was dominated by much larger and more financially able
companies. As Wessel (2016) suggests, new technologies and a relevant
business model provide the potential to take over a market, and we will
outline relevant examples in relation to Aramex.
This study is structured as follows: the current section introduced
the study, the next section will review the prior relevant literature, the
section after that will outline the research methodology, then the
findings will be presented, and finally discussion and conclusion will
take place.
2. Literature and theoretical review
The theoretical context of the current study is theory of disruption,
which was developed and presented by Clayton Christensen in the
1990s. The originally developed version clearly limits a disruptive in-
novation to a company that focussed on the lower end of a market
through providing a cheaper and more accessible, for customers, pro-
duct and/or service and having adopted a relevant business model
(Christensen, 1997). As a result, they change their industry perma-
nently and take over leadership from the incumbents who otherwise
lead when sustaining innovation (Christensen, 1997). Due to their in-
volvement, a product or service has become available to a group of
customers that considered this item unattainable due to price or lack of
L. v. Alberti-Alhtaybat et al.
skills (Christensen, 1997). The theory has since been adopted and
adapted by different scholars that have interpreted and amended ac-
cordingly, and although Christensen upholds his original concept of
innovative disruption (Christensen, 1997), he has made amendments to
reflect the new developments (Denning, 2016). According to these,
disruption theory is a theory of competitive response, which suggests
that if a company innovates in a particular way they need to expect the
same of their competition (Denning, 2016). Thus, if a company aims to
introduce a sustaining innovation the incumbents will seek to eliminate
such new competitor, while if they introduce a disruptive innovation,
incumbents will more likely flee than fight (Denning, 2016). The tra-
ditional aspect of the theory suggests that a disruptive competitor will
initially focus on the lower end of the market, which does not bother an
incumbent, and then will gradually grow his market share until the
current market leader has been eliminated with having been aware of it
in the first place (Denning, 2016).
An example that is provided is Cisco that overtook their competitors
with a disruptive innovation, only to have to now pay attention to new
disruptive innovators (Denning, 2016). More recently, several large
disruptors have significantly changed markets, such as Apple's iPhone
and the fact that Apple's products create an ecosystem at both hardware
and software levels, which leaves competitors struggling but still trying
to keep up. Others, such as Google, have created a market that does not
leave anyone the chance to keep up (Denning, 2016) – thus, it could be
concluded that they have become the incumbent. In general, to become
a disruptive innovator, companies also need to adopt an appropriate
business model that is able to handle new technologies (Chesbrough,
2007). For instance, digital transformation can lead to a business model
that is not only responsive to customers but customer-centred, able to
reflect changing customer requirements, concerned with creating value
for customers and other stakeholders and willing to engage in open
online collaboration (Berman, 2012), which can lead to further dis-
ruptive innovations, through crowdsourcing, for instance. Essentially,
the business model plays an important role in value creation, driving
disruptive innovations and being able to respond to newly introduced
disruptive innovations (Chesbrough, 2007). Only an appropriate busi-
ness model will allow a company to leverage its disruptive innovation
optimally (Chesbrough, 2007).
Disruption in the logistics industry has increasingly been focussed
on in research studies. At the turn of the millennium Pollitt (1998)
determined that logistics businesses in times of Internet and cheaper
and frequent interactions will require new skills, need to adopt new
ways of thinking, and those who can recognise these issues will most
successful at exploiting their opportunities (Pollitt, 1998). The current
study provides an empirical case of how a logistics company recognised
its potential and opportunities in the current disruptive environment on
the basis of its adopted mindset and business values.
The sector can be disrupted at the operational and at the conceptual
level. With regard to the former, disruptive events can take place in
various instances related to the delivery process, e.g. customer-related
disruptions, delivery-equipment-related disruptions and cargo-related
disruptions (Tsai & Hung, 2016), however refer to disruptions in the
existing logistics operations. With regard to the conceptual level, dis-
ruption takes place at the core of the logistics concept, i.e. development
and innovation lead to significant changes in how logistic operations
are executed (Hofmann & Rüsch, 2017), how the logistics sector adapts
to the digital revolution (Nowicka, 2014) and how it remains compe-
titive in the face of disruption (Witkowski, 2017). Current practices are
considered unfit for dealing with volatility and disruption, as the tra-
ditional supply chain practices are not agile enough to deal with a fast
and dynamic environment (Christopher & Holweg, 2011). Christopher
and Holweg (2011) suggest an adaptation of supply chain management
by switching from control to structural flexibility. This would improve
agile responsiveness to turbulence and disruption (Christopher &
Holweg, 2011). The logistics operations related to supply chain also
might be severely disrupted by the introduction to 3D printing in
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Journal of Business Research 94 (2019) 400–407
different sectors, such as construction, as particular production steps
would become obsolete and related logistical efforts would be reduced
(Kothman & Faber, 2016). On the other hand, supply chain agility can
significantly be enhanced by employing disruptive technologies, such as
big data analytics. Giannakis and Louis (2016) identified that agility
refers to responsiveness, flexibility and speed, and that these factors can
be improved for logistical operations through big data analytics in-
corporated in a multi-agent system (Giannakis & Louis, 2016). Thus,
disruptive technologies do not only pose a threat to eliminating logistics
operations but also provide an opportunity for enhancing and advan-
cing logistics operations. Proactive planning can aid companies in
dealing with disruption risk (Chan & Chong, 2015).
According to Christensen (1997), his adapted version of disruption
theory includes three types of innovations, which will influence a
market. Firstly, there are market-creating innovations, which transform
complicated, expensive products into cheaper and attainable alter-
natives, thus creating a new market that threatens the market incum-
bent. Secondly, sustaining innovations make good products better, are
important to upkeep competition, improve profitability, but belong
typically to the market's incumbents. Finally, efficiency innovations do
more with less, and have the same competitive impact on the market as
the incumbents, thus the latter can be eliminated due to lack of effi-
ciency and responsiveness (Denning, 2016). The current case organi-
sation, Aramex, has employed the last type of innovation at the onset,
essentially providing delivery services but in a more cost-effective
manner, which in turn they can pass along to the customer (Hussein
Hachem, Annual Leadership Conference 2016). However, more re-
cently they seek to engage in the first type of innovation, market-
creating, as they seek to redefine the logistics organisation as a ‘tech
enterprise’ with the aim to disrupt the logistics industry (Hussein Ha-
chem, Annual Leadership Conference 2016). Various technological
developments provide Aramex with the potential to disrupt the market,
including 1) Google's driverless cars, which due to Dubai's smart city
initiative will be introduced there in the near future, 2) their various
smart apps that allow them to launch crowd-relevant initiatives,
amongst others to directly relate to customer and ensure value creation
is achieved for the customer and other stakeholders, 3) new hardware,
such as drones for delivery or 3D printing locally (Um, 2017), which
turn the focus on the last mile delivery and may transform this stage of
the delivery chain, and 4) crowdsourcing delivery drivers through so-
cial media connectivity in an Uber-like manner, thus crowdsourcing
allows for creating mutual win-win for corporation and individuals
(Um, 2017). In addition to trying to utilise such developments, they also
need the underlying business model to support such transformation
(Berman, 2012). The current study will illustrate that such business
model is agile (Denning, 2017), able to deal with the unknown and with
chaos (Michelman, 2016), leverages available chances, and manages
the contradictory elements of exploration and exploitation to maintain
its success.
In the context of the adoption of disruptive information technolo-
gies, the current study focusses on the relevant business model of a case
organisation, Aramex, that successfully incorporates and fosters dis-
ruptive technologies. The main research question is therefore:
RQ: what are the elements of the business model that allow Aramex
to successfully address and incorporate disruptive technologies?, in
particular, when considering that most firms appear not to be able to
handle such impact within their current business model but instead
need to start up a new company (Denning, 2017).
3. Aramex's most important developments
The case organisation the current study investigated is Aramex, a
global logistics provider that originates from the Middle East, founded
in Jordan and now residing in Dubai. Aramex stands for Arabian
American Express, as the founders were a Jordanian and an American
businessperson, who originally operated the organisation as a private
L. v. Alberti-Alhtaybat et al.
company. Their core business is based in the Middle East and Northern
African (MENA) region but they provide delivery services across the
globe. Since its inception in 1982, it operated as a private company
until 1997 when the company chose to go public on Nasdaq as the first
Arab corporation to be registered on an American stock exchange. It has
maintained its original entrepreneurial character, having been started
up by two entrepreneurs, even though it has turned into a corporation
two decades ago. Their ‘asset-light’ model reflects the strong innovative
and entrepreneurial character that permeates Aramex's structures and
organisations. As Arab investors did not trust this business model suf-
ficiently to invest in Aramex, they turned to the US and went public on
NASDAQ. After five years, they became a private company again, and
finally chose to register on Dubai Stock Exchange in 2005 where it
moved its headquarters and remains until today. Its annual turnover in
2016 amounted to AED4,343 million, which equates to US$1182 mil-
lion, compared to its larger competitors DHL US$67,381 million, FedEx
US$50,385 million and UPS US$60,906 million. Aramex is at the van-
guard of various innovative developments in the Middle East, including
seeking to adopt the most innovative and emerging technologies as part
of their operations. Aramex's top management addressed a range of new
developments and expected competitive opportunities but also threats
that they need to address in the near future in the context of Dubai's
smart city initiative that was launched to incorporate ‘everything via
the Internet’ (Smart Dubai, 2016).
4. Research approach
The current study is qualitative in nature and assumes an inter-
pretive stance (Moll, Major, & Hoque, 2006), investigating the concept
of disruptive technologies and Aramex's unique business model in the
logistics sector based on theory of disruption. The analysis is under-
taken on the basis of publicly available data regarding Aramex, which
include text and video, and triangulation of findings takes place
through interview data collected from Aramex's senior management,
and private interview material from former employees and Aramex's
management team (Miles & Huberman, 1994). The study outlines de-
tailed descriptions of events and interactions (Patton, 1987) and data is
used to analyse the business model and related disruptive technologies
at Aramex (Moll et al., 2006). This study is a field study in the sense of
researching the publicised documentation, akin to Simnett and Huggins
(2015). To this end, data was collected via interviews and based on
texts and videos that were identified by organisational and institutional
members as relevant material with regard to the study's topic, were
published on the organisational websites (Aramex.com and Aramex.
org), were provided by individual organisational members on the web
(fadighandour.com), were uploaded to the organisational YouTube
channel (Aramex on YouTube), were provided on the INSEAD database
(INSEAD.com) and were generated through Google searches. Further-
more, documents provided by independent academics and organisa-
tions were included to provide a holistic picture of Aramex and to
discern if there were any particular critique and failure concerns re-
garding their knowledge management for disruption. Interviews and
videos were transcribed, and online data were compiled in a document
for analysis.
Data collection took place in three stages. A first interview took
place in 2009 with a senior management team, and following this initial
interview, several former Aramex employees were contacted through
an existing work contact of one of the authors, which led to additional
eight semi-structured interviews. The second round began in late 2015
and lasted until July 2016. Finally, the third round commenced in
December 2016 and lasted until January 2017. The different types of
data helped to triangulate the emerging patterns in the data (Denzin,
1978; Lillis, 2006), and added different insights for the findings. Tri-
angulation enhances trustworthiness in the findings (Shenton, 2004).
Similarly, the relationship of theoretical and literary context and
sample serve to enhance trustworthiness of the data and findings
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Journal of Business Research 94 (2019) 400–407
(Shenton, 2004). Snowball sampling was used to identify documenta-
tion and interviewees (Robinson, 2014; Van Bommel, 2014) as parti-
cipants identified other potential interviewees, and as links from web-
sites and links on the YouTube channel led to further video material to
be included. Selecting different sources creates a heterogeneous data
sample. One important reason for heterogeneity is that any common-
alities across a heterogeneous sample suggest a more generalizable
phenomenon (Glaser & Strauss, 1967). Multiple sources of data are
considered beneficial for supporting the various source analyses
(Hoque, 2006), as well as reflect current research approaches
(Lohmeier, 2014). Multiple sources of data ensure that not one source
leads the researchers' analysis to be too focussed on a particular per-
spective or point of view.
With regard to interviewees, former employees were selected based
on their willingness to participate and their experience with working at
Aramex, thus the level of insight they could provide, which outsiders
would not be able to contribute. Furthermore, former employees were
more critical of the company than current employees would have been,
which served to avoid an overly optimistic perspective. Interviewees
were in fact critical of different, non-related issues regarding the
company but in the context of the current study, their points of view
were unanimous and positive. Participants are classified as Interviewee
1 to 8 as they requested full anonymity, including non-disclosure of any
demographic detail or company-related position. Interviews took place
on the basis of a semi-structured interview schedule, which addressed
their perceptions of new disruptive technologies at Aramex. Broad re-
search questions to be answered were stated during interviews, how-
ever had to be kept as neutral as possible to not lead interviewees
(Jarvenpaa & Lang, 2005), thus were phrased as open-ended questions
that they could answer from their perspective. Allowing the inter-
viewees to express their opinions is an important element of qualitative
research, as researchers want to extract interviewees' perceptions rather
than lead them to any preconceived conclusions (Glaser & Strauss,
1967; Moll et al., 2006). Interviews took place face-to-face, were re-
corded and then fully transcribed, and lasted between 30 and 90 min.
More than one researcher was present for most interviews and kept
notes during the interviews reflecting emphasis and importance given
by the interviewee. Table 1 illustrates text and video material utilised in
the study and was analysed using the same broad questions used in the
interviews.
Data analysis was undertaken based on coding techniques (Glaser &
Strauss, 1967), extracting the main concepts relating to disruption,
innovation-driven change in the logistics sector, and Aramex's unique
business model. Firstly, line-by-line coding takes place, which means
that the researchers went through each transcript to generate codes
based on the empirical data. Each researcher did that on their own, and
then the open codes were compared to arrive at a joint conclusion, also
to enhance trustworthiness of findings. Open codes reflect a search in
the pattern of the data that eventually merges to a joint picture
(Bernard, 2011; Saldana, 2015), and as the analysis proceeds they
eventually emerge repeatedly and as they look alike, describe the same
phenomenon, they are grouped together (Lincoln & Guba, 1985, p.
347). At this point open codes that reflect the same aspect of the phe-
nomenon are subsumed into higher order categories (Glaser & Strauss,
1967; Saldana, 2015). These are then presented as themes or topics that
emerged from the data in the findings, and the logic of presenting these
is based on their highest explanatory power of the phenomenon under
study and the relative importance given to that element of the phe-
nomenon by the participants (Saldana, 2015).
5. Findings - Aramex's unique business model: “Aramex is a
pioneer in digital disruption”
The primary focus of the current study has been the elements of
Aramex's unique business model that allow the company to deal with
disruptive technologies successfully. Aramex's unique business model
L. v. Alberti-Alhtaybat et al. Journal of Business Research 94 (2019) 400–407

Table 1
Documents for analysis.

Title Type of source Provided by Total transcribed:

Aramex Annual Report 2016 Document, integrated Available at: Different excerpts from 1
report https://www.globalreporting.org/Pages/FR-Aramex-2017.aspx document
Aramex Annual Reports 2010–2015 Documents Aramex.org, Different excerpts from 6
https://www.aramex.com/media/resources-downloads documents
Annual Leaders Conference, 2016 Video YouTube Channel: Aramex Fully transcribed: 1 video
Online Blog Document Fadighandour.com 3 blog posts
Various online videos Video YouTube Channel: Aramex: Fully transcribed
https://www.youtube.com/watch?v=2QAedYCubeQ&t=108s
https://www.youtube.com/watch?v=w2HtUV1A-2Y&t=22s
https://www.youtube.com/watch?v=DOZiqr3VStU
https://www.youtube.com/watch?v=wFWF_CPwTHE
Aramex Open Letter: Document Aramex.org, Author: Hussein Hachem, CEO of Aramex Excerpts
Leveraging innovation – a key accelerator
for economic diversity
Aramex Open Letter: Document Aramex.org, Author: Hussein Hachem Excerpts
Leveraging partnerships will be key to
business success in 2017
Aramex Open Letter: Document Aramex.org, Author: Hussein Hachem Excerpts
An overlooked opportunity – SMEs' key
role in economic development
Aramex Open Letter: Document: Aramex.org Author: Mohammad Alkhas, GCC CEO Excerpts
Logistics – one of the keys to a successful
Dubai Expo
Bloomberg Interview Video https://www.youtube.com/watch?v=JIusDTlSwOo&t=24s Fully transcribed
Newspaper Interview Document http://www.thenational.ae/business/economy/frank-kanes-working- Different excerpts from 1
lunch-hussein-hachem-of-aramex-is-a-man-in-a-hurry#page1 document
Investor presentations for the years 2011 to Document https://classic.aramex.com/news/item.aspx?id=8183ecc4-2763-4fb9- Different excerpts
2016 b276-ce7279b31740
Aramex founder Fadi Ghandour on company Video INSEAD, https://www.youtube.com/watch?v=8RucAxBBdY4 Fully transcribed
strategy
Aramex CEO Hussein Hachem Videos SPI Group, Up-close & personal interactive session with Hussein Fully transcribed
Hachem
https://www.youtube.com/watch?v=A6GeYFl-4Vk&t=229s
Friedman, T. (2007) Book chapter The World Is Flat 3.0: A Brief History of the Twenty-first Century:
Analysis of Aramex
Available at: Google Books
SAP News Centre Online post “Aramex is a pioneer in digital disruption”
Magyar, J. (2017), Available at: https://news.sap.com/courier-service-
aramex-thrives-with-radical-business-model/
Aramex News Releases Online document https://www.aramex.com/media/in-the-news/details?contentid=
f88b6088-b3f2-659d-9310-ff0000e7fe0c&module=stories
https://www.aramex.com/media/in-the-news/details?contentId=
902a5a88-b3f2-659d-9310-ff0000e7fe0c&module=stories
https://www.aramex.com/media/in-the-news/details?contentId=
82525c88-b3f2-659d-9310-ff0000e7fe0c&module=stories
https://www.aramex.com/media/in-the-news/details?contentId=
5c2b5a88-b3f2-659d-9310-ff0000e7fe0c&module=stories
Arabian News Online post http://www.arabianbusiness.com/hussein-hachem-ceo-of-aramex-
leveraging-innovation-will-be-key-for-economic-diversification-617696.
html

that was adopted from the onset forms the foundation of their re-
sponsiveness to disruptive potential competitors, new technologies that
can alter the logistics market, and their decision to become a ‘tech
enterprise’ (Hussein Hachem, CEO, Annual Leader's Conference 2016).
Aramex's ‘asset-light’ concept is the very first element of their business
model. They became a global logistics provider by operating on a
minimal fleet approach, primarily focussing on using vehicles for local
delivery but utilising airlines and existing shipping/cargo companies
for long-distance transportation. Thus, they did not invest in large, fixed
assets, contrary to large, global logistics companies, but chose to
maintain an ‘asset-light’ model. Instead of investing in heavy and ex-
pensive assets, they sought to build a network of alliances, essentially
focussing on ‘leveraging strategic alliances’. This model is at the heart
of their strategic approach, as Aramex suggests their sustainable com-
petitive advantage lies in the agility and best-price-for-customer ap-
proach they offer by utilising existing transportation at the best price
possible, rather than maintaining their own large fleet, which would
render their services more expensive. While they can offer lower prices,
their strategic choice means that the customer is willing to wait longer
for their delivery, as speed would mean higher costs. As their reports
and online general and annual leadership meetings (Aramex.org and
Aramex YouTube channel) suggest, they determined that their cus-
tomer preferred to wait and pay less, rendering their model a successful
choice in the MENA region and global market. Thus, their competitive
strategy choice is a combination of cost leadership, offering customers
the lowest cost option possible for traditional delivery, and differ-
entiation with regard to operations, processes and new developments,
such as the e-commerce platform that has set them apart from other
logistic companies in the region. The asset-light business model is
credited across the organisation for promoting agility, innovation-based
problem-solving and incorporating new technologies. ‘The asset-light
model played a main role in our everyday operations, as we had to manage
shipments and transportation accordingly. The motto was to get the best
prices possible to offer the cheapest shipping options to customers. This ap-
proach is also responsible for Aramex's recent focus on disruptive technol-
ogies and start-ups that could enter the market with such technology and
possibly take their business (Interviewee 3). In the logistics industry, their
business model is unique, as they seek to operate internationally with a

404
L. v. Alberti-Alhtaybat et al.
minimal investment level. They chose to only maintain essential de-
livery equipment, such as trucks and vans. ‘We were the Uber of the
logistics industry.’ (Ghandour in Friedman, 2007). Ghandour chose to
focus on creating and developing a network with airlines, using their
commercial planes, rather than buying planes for Aramex, thus devel-
oping strategic alliances. Their latest alliance with Australia Post pro-
vides them with the opportunity to tap into one of the largest global
logistics network, the Post. Therefore, the model focusses executive and
operational thinking on alternative logistics provision, which includes
identifying potential disruptive competitors. Such disruptive compe-
titor is determined on the basis of their technological innovations,
which may lead Aramex to take over the start-up.
‘now everywhere these start-ups come onto the scene, really young
people, and they disrupt the logistics industry {…}. They connect with
each other, it is a sharing economy, they are lean, they are into high
technology and have no barriers to entry, they can go global and con-
nect with each other, so they disrupt the globality of the supply chain.
And we will work with them together, rather than let them disrupt us,
across the world’ (Hussein Hachem, Annual Leadership Conference,
2016).
5.1. Engaging with digital disruption and new technologies
Based on their adopted business model, Aramex focusses on
adopting new technologies and engaging with new start-ups that could
potentially significantly affect their business negatively. Initially, Thus,
they seek to be agile and innovative across the organisation, as they
seek to integrate such developments, as opposed to consider them as
threats and fight them. One example is using the free time of other
delivery services for Aramex last mile delivery. Instead of hiring their
own full-time staff, they engage with similar delivery service providers,
in particular in markets that they are still exploring and expanding. In
their core markets, such as Dubai, they have changed the salary
structure from fixed to variable, and have begun to outsource last-mile
delivery through a mobile app that allows private drivers to connect to
the Aramex network in an Uber-like fashion engaging with the sharing
economy. Thus, they can outsource last mile delivery to interested
members of the public. Furthermore, they recently incorporated a new
mapping technology, called what3words (https://what3words.com),
which introduced a new approach to mapping the world and improved
locating addresses significantly, saving time and money, and enhancing
delivery performance and customer experience.
‘Innovation in technology is critical to maintaining our asset-light
business model and leveraging the Aramex global network. Instead of
investing heavily in infrastructure, we acquire or partner with do-
mestic-focused logistics companies that have strong local networks,
knowledge and transportation solutions already in place for efficient
and effective last-mile delivery. […] we consider ourselves a tech-
nology enterprise, selling transportation and logistics solutions without
being encumbered by heavy investments in assets’ (Interview with
Senior Management Members). Aramex provides logistics solutions in
the widest sense rather than just transportation of goods from one lo-
cation to another, which includes warehousing of assets, including data
storage, and innovative last mile delivery options on the basis of new
technologies. Their business model significantly profits from emerging
technological developments, such as drone deliveries, self-driving cars,
RFID technology, as it allows the logistics provider and the customer to
keep constant track of the shipment. They refer to this as ‘leveraging
innovation for economic diversification’ (Interview with Hussein
Hachem, Arabian News), which they focus on to enhance stakeholder
value (Aramex Annual Report, 2016).
A further significant feature of engaging with disruption is fostering,
‘leveraging’, strategic partnerships. One of the major competitors that
Aramex identified was the Post, and in order to get access to the postal
network, they created a strategic alliance with Australian Post (Hussein
Hachem, Bloomberg Interview, 2017). ‘If you don't have resources, you
405
Journal of Business Research 94 (2019) 400–407
need strategic alliances, it is the only way you can succeed’ (Fadi
Ghandour, INSEAD Interview). This reflects the organisational DNA, as
Aramex has commenced and sustained its business solely on the basis of
strategic partnerships and agreements since its inception (Fadi
Ghandour, INSEAD Interview). Such strategic partnerships have been
their key entrance method to new markets, and remain an important
feature of their approach to exploring new emerging markets, such as
Asia and Africa. These markets provide great potential for e-commerce,
and Aramex's shop-and-ship platform reflects their agility, as they can
deliver to any remote location through their local strategic relation-
ships. They have been the first to introduce shop-and-ship, providing
MENA region customers with the opportunity of buying goods online on
the global market and then having them delivered to their homes via
Aramex, importantly from shops that typically did not deliver abroad.
This initiative has grown into its own online portal, which now services
65 different countries (www.shopandship.com), with Aramex main-
taining the global delivery via their asset-light model.
5.2. Engaging with big data analytics
Furthermore, Aramex leverages big data analytics (BDA) and seeks
to gather as much insight as possible with regard to its current and
potential future business context. Through detailed BDA, they were able
to distinctively identify its customers and tailor their products and
services accordingly, thus seeking to maintain and expand new markets
and new customer segments. ‘We understood that behind every cus-
tomer in several of our core markets there are many more customers,
which we could not determine previously. Now, I have knowledge of
their demographic situation, thus I can tailor the delivery experience to
suit them. For every customer, I need to know who they are – what they
ordered, what they liked, where they are located, their basic info, such
as age, gender, profession, etc., in order try and predict what they will
do next and in the future. If I can accurately determine future customer
behaviour, I can adjust my business accordingly’ (Hussein Hachem,
YouTube – published interview).
Furthermore, Aramex gathers data from its IoE devices, which is
utilised for BDA, akin to other logistics providers, to get insight into
driver routes, consumption of resources, timing of activities, and gen-
eral details of processes and operations, in order to engage in well-in-
formed decision-making, planning and controlling. As recently dis-
cussed in one of Aramex's annual leadership meetings (Aramex
YouTube Channel), the Dubai Smart City Initiative plays an important
role in their adoption of emerging technologies, as Aramex clearly
stated their interest in adopting driverless vehicles. However, for such
IoE innovation to be adoptable, the local and international infra-
structure needs to be expanded accordingly. This is an important ele-
ment in adopting emerging technologies in all markets, as without the
relevant infrastructure organisations cannot exploit such IoE technol-
ogies, and gather and analyse the relevant data through BDA, to their
full potential and for their competitive advantage. While big logistic
companies have always been part of Aramex's competitors, recently
small start-ups and growing entrepreneurial ventures have joined the
market and have been identified as a potential threat by Aramex's top
management during the Annual Leadership meeting of 2016. Such
ventures include Uber and Careem, as private drivers can take over last-
mile delivery, essentially rendering logistic specialists unnecessary for
local market delivery, and new technological developments, such as
drones that can carry heavy packages over long distances, which means
a fleet of vans and drivers is unnecessary. In order to deal with such
competition, one of their strategies has been acquisition and coopera-
tion, essentially joining their competition rather than seeking to fight it,
which can expand their competitive advantage, in particular because
technological innovation is a continuous contemporary development.
L. v. Alberti-Alhtaybat et al.
6. Discussion and conclusion
The previous section has illustrated Aramex's unique business
model, which allows them to address and incorporate disruptive tech-
nologies in their innovative approach to logistics operations. Their
knowledge of being a logistics provider through an innovative asset-
light business model is accumulated and shared through their use of
new technologies. The current study on Aramex was undertaken be-
cause they are considered ‘a pioneer in digital disruption’ (SAP online
post on Aramex) and because the literature review clearly identified
that disruptive technologies would have an impact on the logistics
sector in the future but that little empirical insight was available on
how such impact could take place and how companies could deal with
it (Hofmann & Rüsch, 2017). Thus, the current study contributes va-
luable empirical insight to this lacuna.
Creating a knowledge fusion (Xu, Frankwich, & Ramirez, 2016) of
their long-term acquired and developed knowledge of being an in-
novative logistics provider, their service provider's local knowledge and
the knowledge of new technologies, renders their business model very
agile and dynamic, which significantly aids value and sustainable
competitive advantage creation. As suggested by Chesbrough (2007)
and Berman (2012), an appropriate business model is necessary to be
able to compete with disruptors, possible develop into a disruptor
themselves, incorporate disruptive technologies and continue business
successfully. In the ‘Age of Agile’ (Denning, 2017), corporations that are
faced with unanticipated, fast and ‘ruthless’ disruptive competition
must adapt their processes, practices and operations, essentially adopt a
new business model, in order to survive and even outrun their com-
petition, and many companies are not equipped to do so (Denning,
2017). The case of Aramex has presented a potential approach, a start-
up mindset within a large corporation, a drive for quick decision-
making, risk-taking and searching for the right arrangements to harvest
for value creation. Introducing a department that aims to predict dis-
ruptions is one example of how Aramex approaches its decision-
making. Essentially, they seek to address the future with an exponential
mindset, challenging the status quo to predict future developments.
Thus, lightening the corporate machine would be one important lesson
one can learn from this case. Furthermore, while technology in general
and disruptive technologies in particular are able to change industries,
companies and even economies, the human touch, also understood as
soft skills, the ability to interpret and predict human behaviour is an
important ability that machines cannot easily, if ever, imitate, yet they
are part of the competitive reality and their necessity is on the rise
(Kolbjørnsrud, Amico, & Thomas, 2017). The expected unpredictability
and ensuing chaos of the near future in business (Michelman, 2016)
need a responsive, agile and asset-light business model in order to ‘steer
the ship safely through the tides’.
The contributions and implications arising from the current study
provide insight for academics and practitioners. Firstly, disruptive
technology plays an important role in the logistics industry. This is
important for other logistics providers, their customers, but also aca-
demics that research the logistics sector and educate students for the
global marketplace. Aramex has, for instance, engaged in big data
analytics in order to gather information about its customers, so that
they can tailor their services according to the customers' behaviour and
needs. Its unique business model which focusses on leveraging non-
tangible assets, such as strategic alliances, technological developments,
start- ups and human capital, is in stark contrast to other global logistics
players but their regional and experiential context have led to the
adoption of such business model. Their current aim is to disrupt the
industry, for instance through big data analytics focussed on customer
analysis but also on determining potential competitors, due to which
Aramex realised that their traditional competitors are no longer their
primary concern but that now new players, such as delivery start-ups
like Uber, enter the market that are highly disruptive. To this end, their
agile and business model incorporated disruptive technologies, in order
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Journal of Business Research 94 (2019) 400–407
to gain greater insight and improve planning and decision-making.
Agility in the business model relies on appropriate capabilities' man-
agement (Battistella, Toni, De Zan, & Pessot, 2017). One initiative is
their disruption department, which focusses on creating various dis-
ruption scenarios that they can then consider in their managerial de-
cision-making, and in the process, choose to disrupt themselves in order
to remain ahead of the curve (Sherman, 2017).
While the case of Aramex illustrates interesting developments in a
specific industry, logistics, and currently bound to a localised area,
Dubai, future developments need such technological innovations on a
global level. Changing established city and country structures to ac-
commodate total connectivity in form of the IoE, is a work-in-progress,
that will only be completed over time. Secondly, for future develop-
ments in practice, organisations need to consider their overall in-
novative, entrepreneurial culture context as to whether they are ready
to adopt disruptive technologies, and also become a disruptor, and
whether they need to undertake any organisational changes, which in
turn can impact on their strategic choices and value creation efforts.
The relevant organisational mindset and business model need to be
considered, as through these knowledge is shared in an organisation.
Agility is a key component that organisations and its individuals need to
adopt in order to progressively succeed in a disruptive environment.
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