Article

Sustainable Service Quality Global Business Review

19(3S) 130S–150S
Management by Logistics Service © 2018 IMI
SAGE Publications
Providers: An Indian Perspective sagepub.in/home.nav
DOI: 10.1177/0972150918758098
http://journals.sagepub.com/home/gbr

Anchal Gupta1
Rajesh K. Singh2
P. K. Suri1

Abstract
Due to advancement of technology and globalization, the organizations are giving more importance
to the supply chain integration, taking support from logistics service providers (LSPs) and practice
several initiatives in direction of sustainability. The assets, processes and performance capabilities of
LSPs can be used as an indicator to comprehend and evaluate effective and sustainable service quality
management. In this article, there is an attempt to understand and analyse all important components
required by LSPs to serve their customers with best quality of services. A comprehensive framework
is proposed for evaluating the services of logistics providers. The services are evaluated on the basis of
LSPs assets, processes, service quality attributes and sustainable performance parameters. A case study
on Indian logistics service provider is taken to support the proposed framework in a real scenario.
The assets and processes in context to given case organization are discussed in detail. The service
quality index is also evaluated for estimating the quality of services of firm by taking inputs from their
customers. After discussing service quality analysis, the performance analysis is done along with SWOT
Analysis. Findings of the study will help professionals in developing appropriate strategies for effective
and sustainable supply chain management.

Keywords
Logistics service providers, service quality, sustainable practices, service quality index, performance
analysis

Introduction
In the era of globalization, the organizations believe in building strong networks within and among their
supply chain partners for maintaining long-term relationship with them. Nowadays strong network,

1
Delhi School of Management, Delhi Technological University, New Delhi, India.
2
Operations Management, Management Development Institute, Gurgaon, India.

Corresponding author:
Anchal Gupta, Delhi School of Management, Delhi Technological University, New Delhi-110027, India.
E-mail: anchal.gupta1503@gmail.com
Gupta et al. 131S

better communication and environment sustainability are the most important areas of concern among
all the intermediaries to meet dynamic customer requirements and for making business successful.
Moreover, flexibility in processes, mass customization and serving end users with high varieties have
become comparatively simple by making better use of available logistics services. Organizations usually
outsource their forward and reverse logistics activities to logistics service providers (LSPs) with the
purpose of focusing more on their core competency, reduction in costs, improvements in deliverables,
scaling business to a wider network reach and improving their supply chain (Sanchís-Pedregosa,
Gonzalez-Zamora & Palacín-Sánchez, 2017). Logistics providers or third party logistics (3PLs) have
marked their importance by delivering many direct and indirect benefits to the end users by managing
smooth flow of materials across up/down stream of supply chain. According to a study done by the
Confederation of Indian Industry, the logistics sector in India contributed around 13–14 per cent of the
country’s GDP in FY 2016 and it is expected to touch $200 billion by FY 2020 (Outlook India, 2016).
A global logistics survey claims that over 80 per cent of organizations have outsourced at least one logis-
tics activity to 3PLs providers. The LSPs are responsible for the overall supply chain performance and
hence make high impact on customer satisfaction and in improving firm’s profitability. The LSPs also
show high concern about long-term sustainability by making better use of available resources in order to
improve their performance. Almost all manufacturing sectors such as automobile, auto components,
pharmaceuticals, fast-moving consumer goods including agriculture outsource logistics functions to
widen customer database with optimization of resources. Apart from conventional performance meas-
ures, organizations are also focusing nowadays on sustainability issues in current globally competitive
environment. Sustainable practices can give assurance for long-lasting businesses with same set of avail-
able natural, social and economic resources. Wiengarten and Longoni (2015) examined the impact of
supply chain integration empirically on operational, environmental and social sustainability perfor-
mance. Lam and Dai (2015) proposed a methodology for maintaining environmental performance in
context to LSPs. The LSPs are also taking many possible initiatives to preserve the natural resources for
smooth long-term business continuity. Reduction in carbon emission, reduction in fuel consumption,
maximum utilization of available resources, making use of solar energy, making use of reusable or
recyclable materials, and planting trees are several initiatives, which can be taken by service providers
as a contribution to the society and environment.
Quality of services provided by logistics providers has a direct impact on organization’s business.
Hence, organizations evaluate their LSP’s performance very critically and choose the service provider
rationally. LSPs understand the importance of service quality for their survival and growth and therefore
strive to deliver high-quality services to ensure more satisfied customers. Usually, firms categorize LSPs
on the basis of industry segment, product differentiation and target market. The firms evaluate the
services provided by LSPs on various parameters for their business continuity. The assets, processes and
performance of any service provider can be considered as an indication of effective service quality
(Singh, Garg & Deshmukh, 2006). The quality of services of LSPs can be also evaluated in terms of their
commitment towards their work, competitive skills and communication with their customers. Evaluation
and final decision on selection of LSPs depends on the range of services, reach, network, quality, operat-
ing procedures and performance capabilities.
Service quality is gaining importance as a critical determinant of business performance. Quality of
services directly impacts cost as well as profits of the organizations. ‘Service quality’ can be defined as
the consumer’s satisfaction level from the service encounter and it also includes the expectations of
consumer before taking service and, the way, by which service is conveyed simultaneously. Service
quality management is managing all service quality issues for providing better services and serving
customer with optimum level of satisfaction. The relationship of service quality management with
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business performance, lower costs, customer satisfaction, customer loyalty and profitability is already
established by many researchers in literature (Seth, Deshmukh & Vrat, 2006a). Nowadays, the organiza-
tions look forward to understand the parameters on which customer can evaluate quality of services of
LSPs, drivers which ensure the successful delivery of services and the barriers which hinder their growth.
The major barriers which come across the path of Indian LSPs are highly fragmented unorganized sector,
non-industry status, infrastructural bottlenecks, low rate of technology adoption, skill shortages and
behavioural complexities and so on. These obstacles sometimes become an important cause of failure of
desired logistics services. Although the government has initiated various projects like dedicated freight
corridors (DFC) and inland waterways and many infrastructures related mega projects to overcome these
hurdles, LSPs are struggling to provide service quality as per dynamic needs of customers. In this
process, sustainability of operations is also playing a crucial role.
Most of the developed countries are in phase of outsourcing of logistics services, whereas few
countries are still in infancy phase (Tan, Yifei, Zhang & Hilmola, 2014). The key drivers that affect the
growth of logistics sector in developing countries like India are increase in e-businesses across different
sectors, rising need of outsourcing in domestic and international markets, rapidly evolving regulatory
policies, increasing awareness about environmental sustainability and upcoming mega infrastructure
projects. Rise in globalization and advancement of technology can also become responsible reasons for
organizations to redesign their strategies and develop products to serve global needs through LSP’s
capabilities.
Poor quality of services impacts directly on performance of any organization and create hurdles for
future sustainability. The LSPs need to upgrade their service quality not only in terms of conventional
measures but also in terms of sustainability measures. Most of the studies have considered conventional
dimensions of service quality and ignored sustainability measures (Mentzer, Flint & Hult, 2001; Persson
& Virum, 2001; Singh, Sharma & Garg, 2016). These studies have also considered only result-oriented
dimensions, whereas for sustainable growth, organizations need to follow holistic approach consisting of
inputs, outputs and processes for sustainable growth.
The article is organized as follows. After introduction, review of literature has been discussed in
second section. In third section, the objectives of the study have been discussed. A sustainable service
quality management framework is proposed in fourth section. In fifth section, research methodology of
the article is discussed. In sixth section, a case study of a logistics provider is taken to support the
proposed framework in a real scenario. The assets and processes in context to given case organization
are discussed in detail. The service quality index is evaluated for estimating the quality of services of
firm by taking inputs from their customers. After discussing service quality analysis, the performance
parameters are analysed by detailed reviewing of case firm’s data and sustainable practices along with
strengths, weakness, opportunities and threats (SWOT) analysis. In seventh section, the results and
discussions have been discussed with concluding remarks and managerial implications and limitations
of the study are discussed in eighth section.

Review of Literature
The LSPs are third party organizations, who manage, control and deliver all integrated logistics services
on the behalf of a shipper. Traditionally, LSPs are supposed to look after only transportation activities but
nowadays, the outsourcing part is transformed into fully integrated logistics solutions and delivered in
the form of all shopping at one stop (Kumar & Singh, 2012). 3PLs provide multiple logistics functions
for multiple products to multiple vendors simultaneously (Tan et al., 2014). The function of LSPs is not
Gupta et al. 133S

limited up to bulk procurement, inbound and outbound transportation, order processing, warehousing,
fleet management, shipment consolidation, distribution network optimization, value-added services
including packaging and kitting and so on. Some logistics providers which have their own assets like
fleet or warehouses to support organizations are generally referred as ‘asset type’. If they do not have
sufficient resources of their own to satisfy organizations, then they are termed as ‘non-asset type’ (Tezuka,
2011).
The LSPs serve end users with their core competencies and best practices with the objective of better
future prospects. From literature, many best practices of logistics providers are extracted which becomes
the major reason for their success. As for example, cost reduction (Marcoa, Caglianoa, Manganoa &
Perfetti, 2014; Sahay & Mohan, 2006), resource optimization (Jayaram & Tan, 2010), supply chain inte-
gration (Evangelista, Mckinnon & Sweeney, 2013; Jiang, Wang & Yan, 2014), wide geographical cover-
age (Gilaninia et al., 2011; Soinio, Tanskanen & Finne, 2012), advanced IT applications (Evangelista
et al., 2013), flexibility in services (Huang, Yen & Liu, 2014; Kumar & Singh, 2012) and product returns
(Govindan, Palaniappan, Zhu & Kannan, 2012) are the common best practices followed by LSPs to
provide optimum services to their customers for building long-term relationship with them.
The major players in Indian market providing logistics services are AllCargo Logistics, Gati, Transport
Corporation of India, CONCOR, ABC India, AFL Logistics, Om Logistics and Safe Express and so on.
The LSPs in India capture different markets as per their expertise and asset availability. Many foreign
logistics providers such as Schenker, DHL (Blue Dart) and TNT are also serving Indian market currently.
The Indian market seems to be very attractive for many multinational logistics companies because of
enormous market size and low competition for reasonably priced services.
In literature, many theories and several mathematical models are developed to support efficiency
analysis and to measure or analyse the performance of service providers (Hamdan & Rogers, 2008;
Huang et al., 2014; Kayakutlu & Buyukozkan, 2011; Kumar & Singh, 2012; Marcoa et al., 2014; Rajesh,
Pugazhendhi, Ganesh, Yves & Lenny, 2012). The firms critically identified the parameters for evaluation
of service quality of LSPs and then evaluated their performance of identified parameters for long-term
business continuity.
There is rich literature available on definitions, dimensions, models and measurement methods of
service quality. Seth, Deshmukh and Vrat (2005) critically reviewed 19 service quality models published
in literature for the period of 20 years (1984–2003) and also compared models to identify linkages
among them. Most popular SERVQUAL model was given by Parasuraman, Berry and Zeithaml (1993)
emphasizing on the concept that service quality can be defined as a gap between the consumer’s expecta-
tion (of services to be received) and consumer’s perceptions (of services actually received). A multi-item
scale instrument SERVQUAL was developed on the basis of five dimensions, that is, tangibles, reliabil-
ity, responsiveness, assurance and empathy. In an alternative, SERVPERF model was given by Cronin
and Taylor (1992) which considers only performance measures of the service quality. Many researchers
revised the service quality models as per the requirement of study from time to time. Some authors
upgraded the previous models in accordance with latest advancements in technology and market
dynamics.
Some models are developed for common use, whereas few service quality models are focused to cater
to specific industry needs. In literature, over the past two decades, at least 30 industry-specific areas were
selected and various service quality models were developed to meet the requirements of specific sector
(Ladhari, 2008). In past scholarly articles, the applicability of service quality models in wide areas has
been identified such as banking, restaurants, hotels, higher education, information systems, health sector,
sports and telecommunication. Moreover, the scales used in service quality models are found to be
different for various countries such as Canada, Australia, Hong Kong, Korea, Spain and USA. The nature
134S Global Business Review 19(3S)

and number of dimensions varied according to the service context under study (Buttle, 1996). Frost and
Kumar (2000) developed model for internal service quality, whereas Charles and Kumar (2014) pre-
sented a model for the same by using a measurement technique—data envelopment analysis (DEA).
Enquist, Edvardsson and Sebhatu (2007) presented a model for value-based sustainable service business,
whereas Stamenkov and Dika (2015) proposed a sustainable e-service quality model banking industry.
Sustainable e-service quality models focused on managing high-quality e-services by capturing internal
and external domains both.
Seth et al. (2006a) highlighted the importance of service quality models in supply chain and devel-
oped a model for an integrated complete supply chain from supplier to consumer based on gap analysis.
Seth et al. (2006b) further revised their model by adding one more component, that is, 3PLs into their
existing framework. Juga, Juntunen and Grant (2010) investigated how perceived logistics service
quality satisfied shipper and subsequently resulted in customer loyalty in 3PLs services in Finland. The
internal and external environments of service provider both create equal impact on deliverables to con-
sumers. The assets or resources, strategies or processes and overall performance, all make overall
conduct to satisfy customers from provided services (Singh & Sharma, 2015). Although many organiza-
tions conducted surveys from time to time to monitor the progress of third party service markets, very
little research has been done to examine the relationships between firm’s assets, processes, service
quality management and customer satisfaction in these services
From literature review, the common assets or resources used by LSPs to serve their customers with
best services are extracted. The various processes or services performed by LSPs to serve customers of
huge variety with various set of demands. The dimensions required for service quality analysis are also
shortlisted from past scholarly articles and discussed in terms of 7C’s. Commitment, Competence,
Communication, Creativity and Customization, Cost Optimization, Coordination and Collaboration and
Culture are all important dimensions required to understand and analyse the service quality issues of any
3PLs (Jothimani & Sarmah, 2014; Stank, Goldsby, Vickery & Savitskie, 2003). Organizations also eval-
uate their performance empirically as well as theoretically. Numerous performance parameters are used
by organizations to evaluate the services of LSPs. In this study, assets, processes, service quality dimen-
sions and performance parameters are extracted from vast literature review and short listing of different
sub-factors under these issues has been done after discussing with experts as shown in Table 1. The
assets and processes are the prerequisite for any organization to provide quality services to their clients.
Service quality has a clear impact on the performance of the organization. Therefore, these four issues,
that is, assets, processes, service quality and performance, are the major components of proposed
framework for the study (Figure 1).
On the basis of literature review, the objectives for the study are discussed in next section.

Objectives
The aim of the study is to identify the service quality issues of an Indian logistics service provider. The
objective of this article is to understand and analyse all important components required by LSPs to serve
their customers as per global standards. A comprehensive framework for sustainable service quality
management is also proposed. Further, the framework is illustrated by taken a real-life case. An attempt
has been made to understand the major assets of the case organization, the different processes which they
function and the major factors that impact the service quality of their organization. The strengths, weak-
ness, opportunities and threats of the organization in current environment have been also studied with the
help of SWOT analysis.
Gupta et al. 135S

Table 1. Issues of Sustainable Service Quality Management

Components References
Assets Tan et al. (2014), Evangelista et al. (2013), Forslund (2012),
• Warehouses (domestic/global) Soinio et al. (2012), Basligil, Kara, Alcan, Ozkan and Caglar
• Fleet (land/sea/air) (2011), Gilaninia et al. (2011), Sakun (2011), Jayaram and Tan
• Skilled and experienced manpower (2010), Naim, Aryee and Potter (2010), Sahay and Mohan
• Network—area coverage (2006), Wong and Karia (2010), Hamdan and Rogers (2008),
• Information technology Fasanghari, Roudsari and Chaharsooghi (2008), Jharkharia and
Shankar (2005), Sahay and Mohan (2006), Aghazadeh (2003),
Farmer (1988), Singh (2013a).
Processes Huang et al. (2014), Singh et al. (2013), Govindan et al.
• Order processing (2012), Ulku and Bookbinder (2012), Kumar and Singh
• Warehouse management (2012), Soinio et al. (2012), Basligil et al. (2011), Busse and
• Inventory management Wallenburg (2011), Tezuka (2011), Naim et al. (2010),
• Multi-modal transportation Ellinger, Ketchen, Hult, Elmadag and Richey (2008), Sahay
• Value-added services and Mohan (2006), Mentzer et al. (1999, 2001), Zapfel and
• Resource optimization Wsaner (2002), Boyson, Corsi, Dresner and Robinovich
• Sustainability practices (1999), Millen, Sohal and Moss (1999), Singh (2013b).
Service Quality Analysis Evangelista and Durst (2015), Izogo and Ogba (2015),
• Commitment Lam and Dai (2015), Ranjan, Sugathan and Rossmann (2015),
• Competence Ravi and Shankar (2015), Huang et al. (2014), Jiang et al.
• Communication (2014), Jothimani and Sarmah (2014), Juntunen, Juntunen
• Creativity and customization and Juga (2014), Yeung, Zhou, Yeung and Cheng (2012),
• Cost optimization Busse and Wallenburg (2011), Sakun (2011), Tezuka (2011),
• Coordination and collaboration Juga et al. (2010), Jayaram and Tan (2010), Huo, Seklen,
• Culture Yeung and Zhao (2008), Stank et al. (2003), Ghobadian
et al. (1994), Farmer (1988), Parasuraman, Zeithaml and
Berry (1985, 1988).
Performance Analysis Evangelista and Durst (2015), Juntunen et al. (2014),
• Increase in turnover Jothimani and Sarmah (2014), Marcoa et al. (2014), Rajasekar
• Improvement in quality and Bhuvaneswari (2014), Yeung et al. (2012), Basligil et al.
• Increase in shipments (2011), Kayakutlu and Buyukozkan (2011), Singh et al. (2008),
• Network optimization Jharkharia and Shankar (2005), Stank et al. (2003), Mentzer
• Green logistic and warehousing et al. (1999, 2001), Franceschini and Rafele (2000).
• Use of recyclable/reusable packaging and pallets
Source: Prepared by the author.

Theoretical Framework
As discussed in literature review, the services provided by LSPs will depend on its assets, processes and
ability to manage service quality challenges to improve overall performance of the organization as shown
in Figure 1.
The LSPs need to manage their quality of services for long-term commitment and future growth.
A logistics provider can provide satisfactory services to their customers only if they are well equipped
with their resources, well-defined processes and have capabilities to assess their service quality and
performance from time to time. In this framework, the services provided by logistics providers can be
136S Global Business Review 19(3S)

Figure 1. Proposed Framework for Sustainable Service Quality Management by LSPs

Source: Authors’ own.

evaluated on the basis of assets and processes available to them. The evaluation of service quality on
7C’s (service quality dimensions as mentioned above) has been done by computing through service
quality index. Cleveland, Schroeder and Anderson (1989) have given the framework for computing
index of production competence. It has been extended to evaluate service quality index in present
research. On the basis of results, the organizations can visualize its position in the industry and can iden-
tify gaps for better performance. Further, there is direct impact of better quality services on the perfor-
mance of organization. Therefore, service quality analysis will help in improving overall performance of
the organization. These analyses will facilitate organization to understand their processes and perfor-
mance more closely. The LSPs can recognize their strengths and weakness in more elaborative way
through SWOT analysis in terms of providing optimum quality of services to the customers.

Research Methodology
The service quality delivered by 3PLs is the major criteria for their future selection by same customer or
prospected customers. In this study, an attempt has been made to understand the requirements of organ-
izations for the selection of logistics providers based on service quality management as per their business
needs. Case research has emerged as an effective tool of research methodology for an understanding and
in-depth analysis of issues in dynamic markets. Case research methodology gives freedom to develop
new theories by removing the restrictions of following rigid constraints of questionnaires and models.
The outcomes received from case research methods are usually of high impact as based on individual
understanding and leads to some new, unique and creative insights. Although many challenges can come
across while conducting case research methodology such as time-consuming process or attention
required, an in-depth analysis to generalize conclusions from limited information and so on.
In developing this case study, Eisenhardt (1989) framework is used. Singh et al. (2008) have used this
framework for competitiveness analysis of a medium-scale organization.

Selection of Case Study

The organization is selected for the case on the basis of quality of services provided to the customers.
The case company is one of the well-known leading LSPs in India and holds huge chunk of current
market share. The criteria for selection of case company is based on three factors—base, turnover and
Gupta et al. 137S

workforce. The company is purely Indian, and its turnover is more than 500 crores and has more than
5,000 dedicated workforce. The company is serving huge number of industries which results in strong
pool of customer can be considered as a better example to understand current Indian LSPs.

Data Source and Collection

The case company was contacted by telephone and allowed us for conducting research study. Data were
collected by having many discussions with middle and senior management. Face-to-face interviews
were conducted with six experts from top and middle management. A structured questionnaire is devel-
oped to capture major issues related to service quality which is further followed by interviews and obser-
vations. Multiple respondents filled the questionnaire and previous five year data were also provided by
the organization.

Data Analysis
Data and information collected from various sources from the organization are analysed to understand
the service quality index and performance analysis in broader perspective.

Case study
After developing a service quality framework based on literature review and experts opinion, the case
study is conducted in Indian context to analyse different issues as per the framework proposed.

Profile of the Case Organization

ABC Ltd (name changed) was established in early 1980s in India with its head office in New Delhi. They
started as a highly reliable carrier and further transformed themselves into a multimodal transport service
provider. Business was expanded across the length and breadth of the country and even to destinations
across the globe in secure, on time and cost-effective manner. In mid 1990s, one more wing was added
to Flagship Company to cater to air cargo segment specifically. In early twenty-first century, a new
company was launched under the same group for handling international freight forwarding and has
developed a specialized domain for serving international logistics and transportation needs. Services
include—global warehousing, distribution by air, ocean and land, brokerage, freight forwarding and
customs consulting services. In early 2000s, they came up with their own packaging solutions company
within the group under joint venture with Japan-based organization.
ABC Ltd is one of the India’s leading multi-modal logistics organization certified with ISO 9001, ISO
14000 and OHSAS certifications, offering one stop integrated solution to all aspects of the supply chain
including efficient handling of surface, sea, express, train and air cargo services on ‘door-to-door basis’
with a gamut of value-added services, with an annual turnover hovering around USD 250 million and
serving almost all major industries such as automobile, electronics, telecom, textile retail, pharmaceuti-
cals, FMCG and many more. Currently, the organization is providing reliable services at competitive
cost with utmost satisfaction to the customers and participating in various CSR activities.
138S Global Business Review 19(3S)

ABC Ltd manages supply chain of over 3,500 corporate, multinationals and blue chip brands on both
domestic and global requirements. ABC Ltd has been providing logistics services to the top 50 auto-
mobile brands in India and over 2,000 auto component part manufacturers. Their clientele includes all
major brand names, such as Mahindra & Mahindra, Apollo Tyres, Maruti Suzuki India Ltd, Mitsubishi,
Dabur, Ericsson, General Motors, Ranbaxy, Honda, Hero MotoCorp, Tata Motors, LG, Bharti Airtel,
Bajaj, BSNL, Cadillac and so on.
ABC Ltd offers best quality services to its customers by redefining excellence in every aspect of busi-
ness. The organization’s main objective is to meet all commitments with perfectly synchronized quality
and cost. The organization is awarded with many well-known awards related to transportation and supply
chain services. The organization has achieved various excellence awards for their outstanding services
like Man of Logistics, Logistics Man of the year, Pride of India Award, Parivahan Shreshtha Award,
Transport Ratan, Smart Workplace Award etc. name to a few. Perfect blend of assets, resources and
measurable performance parameters explains service quality management of ABC Ltd. Major issues as
per proposed framework for the case organization will be analysed in following sections.

Assets of ABC Ltd

ABC Ltd is equipped with valuable assets, which helps in delivering satisfactorily and timely services to
the customer. The organization has very enriched infrastructure, skilled manpower, IT support and wide
network range which are considered as their major assets and discussed in following section.
State-of-the-art Warehouses
ABC Ltd has set up their state-of-the-art warehouses at strategic locations across the country. The organ-
ization has also enriched infrastructure of more than 20 million sq. ft. of warehousing and storage space
on about 50 locations across India with modern material handling equipment. All inventory-related oper-
ations, labelling, addressing and bar coding of items and management of all distribution activities are
systematically managed by using Warehouse Information Management System (WIMS) software.
Management of spare parts distribution centres (SPDC), managing bonded/non-bonded warehouses
with storage facilities including high racking systems, and offering value-added services like storage bar
coding, labelling with inventory management are some of the core services offered through these state-
of-the-art owned warehouses. Around 80 per cent of ABC Ltd business involves the use of cross-docking
practices, that is, hub and spoke, which is predominantly used for less than truckload (LTL) shipments.
Hubs are strategically located on PAN India basis with concentration towards major business centres
across North, West, South, East and Central India. Every Zone has almost 4–5 hub centres for faster
movement on long haul consolidation/deconsolidation.
Fleet
The organization offers logistics solutions in the form of single window solutions with providing pickup
and delivery from client’s door steps across any part of the world. This is managed though more than
4,000+ GPS-equipped, containerized and all-weather proof fleet comprising of small pickup vans and
ranging through trucks to trailers and capacity ranges from 500 kg vehicles till 40,000 kg vehicles.
Skilled Manpower
ABC Ltd has strength of around 5,000+ well-trained personals who works dedicatedly round the clock
to support all logistics coordination and to handle customer queries on priority. The organization is
equipped with dynamic team of experienced professionals which ensures access to customer services for
Gupta et al. 139S

24×7×365 days. Despite being into one of the most unorganized sectors, organization hires professionals
from major business schools and technical institutions to ensure quality manpower support towards busi-
ness requirements driving customer satisfaction. All levels of manpower are routed through various
stringent training mechanisms and mandatory number of trainings is conducted/attended by all staffs on
annual basis.
Distribution Network and Range
To enable strong connectivity and better services, the organization own more than 450 offices, 30
regional hubs with over 200 inter-connected associates catering to more than 2,000 delivery locations
and covering more than 80 per cent unique postal PIN codes throughout the country. ABC Ltd has inter-
national footprint in more than 80 countries such as China, North America and so on across the globe
through a strategic mix of own offices, exclusive and non-exclusive tie-ups. It also offers services for
movement of goods by air, train, full truckload and express movements which are managed through
scientifically designed hub and spoke mechanism. The organization also deals in export and import busi-
nesses by air, ocean and land bridging. It also offers custom clearance services across all major ports and
inland container depots (ICDs) in India. They are specialized in handling project cargo, heavy lift cargo,
over dimensional cargo, special equipment, containerized cargo, consolidation and break-bulk.
Information Technology
ABC Ltd provides world class, latest technologically advanced IT graphical user interface and online
and real-time applications that enable tracking and tracing of all shipments through their own servers.
The organization also maintains both custom and commercial off-the-shelf records by using manage-
ment information systems (MIS). The organization facilitates their customers by helping them in infor-
mation transfers in efficient and secure manner. It was the first domestic logistics company to initiate
advanced customer friendly IT applications, compatible on all types of mobile operating systems plat-
forms like Android, BlackBerry and iPhone to streamline operations and maintain transparency and
accurate information flow to the customers. The in-house developed software, applications developed on
ORACLE and IT platforms are compatible with SAP and all platforms are currently used by organiza-
tions across the world. The IT support generates auto information flow in forms of daily, weekly, monthly
and annual management information useful as inventory management tools by its clients in short-term
and long-term basis. Currently, entire financial module, HR module, operations module, performance
appraisals, credit module, purchases and fleet management are online mode and are readily available to
users/clients as per the requirements.

Processes of ABC Ltd

The organization provides integrated and timely services to their customers due to their strong processes
taking place at backend. The set of remarkable assets helps in delivery of all services through wide range
of processes. Some important processes done by 3PLs are elaborated in detail in this section.
Order Processing
Services of invoicing from warehouses on the behalf of the clients are executed by the organizations.
The entire management of receipts, dispatches stocks, packaging, labelling, repackaging, sales tax
returns, excise formalities and statutory compliances including insurance are managed by the company
on the behalf of their clients. Clients also entrust responsibilities of bulk purchases and storage through
the said LSP.
140S Global Business Review 19(3S)

Warehouse Management
The organization offers warehouse management for both onsite (in-plant) and offsite (3PL warehouses)
for storage, processing, handling and manpower outsourcing services to their clients. The management
includes key parameters such as time and motion studies for resource planning, warehouse layout design-
ing, 5S maintenance, renting modern material handling equipments and flexible storage solutions using
technologically advanced and integrated IT solutions.
Inventory Management
Organization offers various tools for inventory management using concepts of LIFO, FIFO, ABC
Analysis and Pareto Principles to ensure maximum output, minimum inventory costs, high inventory
turn ratios, minimum stock outs and low obsolescence and mismatches through latest IT tools and skilled
manpower. It mainly works on basis of continuous review of inventory policy.
Multi-modal Transportation
ABC Ltd serves clients with integrated logistics solutions by making optimum use of its multi-modal
transportation. A perfect blend of road, rail and air is used to handle customer queries efficiently and to
serve customers with promised commitments. With break-bulk facilities for bulk goods as well as train
shipment facilities to retail and small customers, the company gives the flexibility to get your cargo
where it needs to be, when it needs to be there.
Value-added Services
ABC Ltd is just not focusing on the core functions but at the same time they also offer variety of value-
added services for smooth functioning of client tasks. It offers various value-added services such
as labelling, packaging, kitting, binning, repackaging, direct online, just in time service, sequential
supplies, scheduling, flier services, escort services, cash management, documentation handling, reverse
logistics, warehouse design and consultancy, packaging and packaging design. Clients can track and
trace their shipments on part-level basis through real time information presence and can check the same
through mail, SMS, web portal, especially designed mobile applications.

Resource Optimization and Sustainability Measures

In today’s environment, all organizations irrespective of manufacturing or services are concerned about
optimum use of resources and preserve them for future use. The organizations are taking many initiatives
in the direction of sustainability at environmental, social and economic level. On the same lines, ABC
Ltd has also initiated few steps to help, save and protect environment and society. The organization is
also certified with world class rating of ISO 14001:2004 for its green initiatives towards environment
protection and sustainability.

• The organization is well equipped with smart GPS technology in almost all of the trucks which
helps in decreasing carbon emission by reducing consumption of fuel. The organization takes
special care for environment protection by employing only those vehicles which carry valid
emission certificates from the Government of India.
• ABC Ltd has also pledged to plant at least 5,000 trees in a year. All of the facilities of organization
are enriched with green cover of the environment as they have a culture of growing tree saplings
in their compounds. Janet Craig, peace lily and air purifying plants are implanted in their ware-
houses and facilities to make environment clean and healthy.
Gupta et al. 141S

• The organization works in various environment save areas to ensure the proper conservation of
natural resources. They also generate power by using solar panels at their various facilities in order
to return back to the environment for long-term sustainability. Natural light is used over heat emit-
ting electric ones and electricity which also helps in carbon credit.
• Majority of the facilities and offices are using rain water harvesting to recycle water. The stored
water is used for washing the vehicles and for gardening purposes.
• ABC Ltd initiated a step towards increasing employability by starting up their own education
institute where supply chain and logistics related short-term courses along with practical trainings
are executed with minimal eligibility criteria and negligible fees. The deserving students also find
opportunity to directly work with ABC Ltd as per their capabilities and domain knowledge.
• The organization also believes in providing healthy environment to their employees so that they
can easily match up with the work requirement of 24×7. The employees are facilitated with resi-
dential and mess services at all the warehouses and facilities to provide a comfortable and healthy
working environment. The firm takes initiatives to educate their employees about the benefits of
working in environment-friendly culture. They are also associated with many charitable trusts
which work for human welfare purposes.

The assets and processes are described based on observations during visits to ABC Ltd facilities and
depth discussions with concerned officials. After this, the quality of services will be analysed by finding
service quality index in next section.

Service Quality Analysis

The quality of services provided to wide customer database can be analysed by taking feedback from
customers from time to time, and subsequently, service quality index can be calculated. The framework
given by Cleveland et al. (1989) used for evaluating production competence index is extended to calcu-
late service quality index in this study. Singh et al. (2006) have used this framework for finding competi-
tive index based on internal and external factors which affect the performance of an organization,
whereas Singh and Mahmood (2014) applied it in finding competitive advantage based on manufactur-
ing strategy. The service quality index of ABC Ltd is evaluated on the basis of service quality dimensions
in the form of 7C’s, which is extracted from vast literature review. The 7C’s means Commitment,
Competence, Communication, Creativity and Customization, Cost Optimization, Coordination and
Collaboration and Culture as shown in Table 1. From literature, 7C’s have emerged as important dimen-
sions, required to understand and evaluate service quality of any LSP.
The commitment would mean reliability of services, responsiveness towards work and assurance of
timely delivery, whereas competence skills would include infrastructure, skilled manpower, capacity and
network coverage of logistics provider (Izogo & Ogba, 2015; Jothimani & Sarmah, 2014). The commu-
nication would include branding and communication with outer world (Huang et al., 2014). The creat-
ivity and customization would mean providing flexibility in services and having innovative capabilities
in serving clients (Busse & Wallenburg, 2011; Evangelista & Durst, 2015). The cost optimization would
include cost optimization for bulk consignments, whereas coordination and collaboration would include
supply chain integration and sharing of information among all supply chain partners by using IT (Ranjan
et al., 2015; Ravi & Shankar, 2015). The culture of ABC Ltd means the attitude and courtesy towards
customers (Juga et al., 2010).
142S Global Business Review 19(3S)

Based on Cleveland et al. (1989) framework, the service quality index can be calculated as

SQIi = ∑(Wj Log Mj)

where SQIi: service quality index for company i; Wj: weight assigned to particular service quality attri-
bute; j: service quality attribute; R: rank of attribute; and Mj: inverse rank.
The data are collected from 50 clients of the ABC Ltd. Then, the mean value for all dimensions is
calculated. The weights are assigned to different dimensions of service quality. Likert scale is used for
finding SQI on a scale of 1 to 5 as 1 being lowest and 5 being highest. Further, 5 and 1 are mapped to
100 per cent and 0 per cent, respectively. A weight (Wj) is assigned to each of the seven dimensions of
service quality and shown in Table 2.
The calculations for finding service quality index are done and shown in Table 3. All the dimensions
except cost are graded in reverse Likert scale, that is, 1—very low and 5—very high. Cost has to be
graded in reverse order because the clients are always preferred to pay less cost for services.
In Table 3, the mean for all dimensions is calculated after taking average of scores from respondents
for all the key components. Then, the ranking, inverse ranking of all attributes, has been done. The
weight for each attribute is assigned on the basis of Table 2. The final service quality index is calculated
by taking sum of entries of last column which is 3.40. Theoretically, the value of service quality index of
LSPs ranges from −3.70 to 3.70. The service quality index of ABC Ltd shows that company is perform-
ing outstanding in terms of their culture and commitment towards work. The organization is also serving
customers with efficient supply chain by making optimum use of available resources. The organization
is also satisfying customers with tailor-made solutions by making effective use of advanced information

Table 2. Weight Criteria for Each Dimension

Mean Value Weight (Wj) Percentage Score

>3 +1 (Strength) When percentage score > 60%
Between 2 and 3 0 (Neutral) When percentage score is between 40% and 60%
<2 −1 (Weakness) When percentage score < 40%
Source: Singh et al. (2006).

Table 3. Calculations for Service Quality Index

Service Quality
S. No Dimensions Mean Rank (R) Inverse Rank (Mj) Log (Mj) Weight (Wj) Wj Log (Mj)
1 Commitment 4.4 2 6 0.78 1 0.78
2 Competence skills 4 5 3 0.48 1 0.48
3 Communication 2.9 6 2 0.30 0 0.00
4 Creativity and 2.7 7 1 0.00 0 0.00
customization
5 Cost optimization 4.3 3 5 0.70 1 0.70
6 Coordination and 4.2 4 4 0.60 1 0.60
collaboration
7 Culture 4.7 1 7 0.85 1 0.85
Service quality index SQIi = R(Wj Log Mj) = 3.40
Source: Authors’ own analysis.
Gupta et al. 143S

technology. On the basis of service quality index, the organization can redesign their branding strategies
to create more awareness and recognition in market for better communication with the outer world.
Based on above analysis, it is observed that ABC Ltd should work to overcome its weaknesses of com-
munication, creativity and customization. There is scope for this organization to improve in these areas
by adopting new innovative ideas. The organization can compare their capabilities with other competi-
tors in the same sector for benchmarking purpose and can revise strategies for betterment. After calculat-
ing the service quality index of ABC Ltd, the performance analysis in terms of analysis of past data,
resource optimization and environment sustainability will be discussed in next section.

Performance Analysis of ABC

Performance measurement is the process of quantifying and analysing the performance parameters to
measure the efficiency and effectiveness of the organization. Usually, organization measures their per-
formance as a ratio of output to input. The outputs generally constitute the final outcome in terms of sales
or revenue generated, whereas inputs are the total resources incurred by the organization. But researchers
have also suggested following ‘subjective and self-reporting methods’ for measuring performance of
their organizations (Singh et al., 2008).
Performance data for five years were collected and shown in Table 4. Some measures on performance
of ABC Ltd based on data are as follows:

• Organization has been growing at a pace of 18–20 per cent year on year (YoY) basis with current
turnover of USD 250 million.
• The organization has set their quality objective of achieving 1 per cent improvement in every
coming year from 2012–2013. Their data support continuous improvement every year with an
annual average improvement of 5 per cent over last 3 years. This is based on number of formal
cases (defective shipments) registered against number of shipments handled annually.
• The number of packets handled hovering around 55 million packets has shown an average annual
increase of 11.5 per cent YoY basis as shown in Table 4.
• The annual increase in number of shipments handled has shown an average increase of 10 per cent
YoY basis for last 3 years and currently handling approximately 2.6 million shipments per annum.
• Organization has been consistently and steadily balancing their sales turnover under different
industry verticals to ensure non-dependability on any specific industry. For example, from a more
than 90 per cent dependability on automotive sector in year 2005, the current contribution of auto-
motive segment is roughly 45 per cent with around 15 per cent each in electronics and white goods
and 15 per cent in telecom and around 10 per cent in pharmaceuticals.
• Shift in turnover contribution from imports, exports, retail and other industry from a meagre 1 per
cent in 2013 has grown to 7.5 per cent in last 3 years.
• The organization is continuously expanding its client database with increase of 10 per cent on YoY
basis and currently associated with more than 4,000 clients.
• ABC Ltd warehouses have occupancy rate of almost 75 per cent. These data verify the optimum
utilization of resources available.
• Most of the warehouses are designed with transparent roof sheet to encourage the usage of natural
light at least in daytime and many warehouses are equipped with solar panels to enlighten the
space even in nights. Therefore, ABC Ltd encourages use of renewable energy sources.
• ABC Ltd has designed its logistics system to emphasize more on direct transportation by making
use of intermodal modes in order to manage distribution networks effectively and also helps in
decreasing average handling factor and average length of back hauls.
Table 4. Five-year Data (2011–2016) of ABC Ltd

Defective
Number of Shipments Number of % Defect on Improvement
ABC Ltd Packets Increase % Weight Increase % Registered Shipments Shipments on Defects
2011–2012 34,289,100 BASE 226,570,585 BASE 3,858 2,023,998 0.19% Base
2012–2013 37,398,102  9.1% 227,241,258 0.3% 3,331 1,994,202 0.17% −12%
2013–2014 41,417,065 10.7% 241,885,126 6.4% 3,705 2,129,505 0.17% 4%
2014–2015 45,308,105  9.4% 264,549,003 9.4% 4,637 2,398,355 0.19% 11%
2015–2016 52,911,809 16.8% 270,303,170 2.2% 4,978 2,565,952 0.19% 0%
Average   11.5%   4.6%      
Increase 5 years
Source: Authors’ own analysis.
Gupta et al. 145S

• ABC Ltd also encourages recyclable/reusable packaging for environment friendliness and for
reducing packaging cost and solid waste. Bubble wrap, biodegradable plastic and paper and card-
boards are recyclable packaging material which are frequently used by ABC Ltd for packaging in
order to promote green practices. Further for handling, storage and end customer deliveries,
recyclable bins, trolleys and totes are used to minimize the use of corrugated packaging.
• It also encourages use of recyclable and reusable pallets which are made of wood, plastic and steel
for storage and handling, thus minimizing labour. Manually operated hydraulic hand pallet trucks,
stackers and lifters are majorly promoted against diesel forklifts to ensure minimum pollution.
Some use of battery operated forklifts and stackers are also practiced.

SWOT Analysis
After analysing the past years data of ABC Ltd, some results which affect the overall performance of the
organization are discussed. Now, there is an attempt to identify and analyse the major SWOT for ABC
Ltd. The SWOT analysis for ABC Ltd is summarized in Table 5. ABC Ltd has strong infrastructure, dedi-
cated personnel, use of advance technology, wide reach as strengths to provide integrated efficient supply
chain solutions to huge customer database with cost advantage. The organization is lacking in creating
brand awareness, getting trained and area-specific skilled manpower and has extensive dependability on
information technology. ABC Ltd has a scope to expand their businesses at more global destinations
especially in SAARC countries. The major threat for ABC Ltd is unorganized logistics sector in India.
It offers services at low cost as compared to established ones.

Table 5. SWOT Analysis of ABC Ltd

Strengths Weaknesses
▪ Single window solution for all services under single banner ▪ Branding/advertising is less as compared to
global brands
▪ Fleet size of more than 4,000+ trucks, (containerized fleet) ▪ High attrition rate at low level
▪ Efficient workforce—manpower strength is approximately ▪ Unskilled Labour
5,000+ ▪ Less visibility in market
▪ Strong customer base (approximately 3,500+) ▪ Extensive dependability on IT systems
▪ Expanding strongly in terms of reach ▪ Low creativity due to cost considerations
▪ Cost advantage and efficient supply chain
▪ Tailor-made solution
▪ Use of advanced IT tools
▪ Online presence 24×7
▪ Being versatile in handling all kinds of commodities
Opportunities Threats
▪ Geographical extension and more destinations ▪ Small players with low cost offerings
▪ Expansion in SARRC countries ▪ Complex law structures
▪ GST implementation can help to consolidate the business ▪ Unorganized sector
in terms of cost benefits
▪ Explore opportunities in B2C segment ▪ Taxation and state barriers/toll charges
▪ Explore other sectors also other than auto sector ▪ No entry issues and changing environmental
regulations
Source: Authors’ own analysis based on discussion with company professionals.
146S Global Business Review 19(3S)

Conclusion
Almost all the organizations are outsourcing their supply chain activities to 3PLs providers in order to
have low cost and better service quality. The LSPs also provide their best of resources and strengths to
serve their customers with optimum level of service. The service quality management of any LSP can be
better explained through its tangible and intangible assets and well-defined processes. The resources and
processes facilitate in providing required service quality and enhance performance of any organization.
In present context of globalization, sustainability in terms of use of resources and raw materials has also
become important component of overall performance analysis. Most of the previous studies have ignored
sustainability issues in service quality analysis. These studies have majorly focused on service quality
parameters. Present study has followed a holistic approach for service quality analysis. It has proposed a
framework for service quality management consisting of assets, processes, service quality and perfor-
mance. This framework has been applied in context to an Indian LSP. The framework will help logistics
providers to understand and position themselves in terms of resource optimization and service quality in
comparison with other service providers. The service quality index and performance analysis can facili-
tate LSPs to identify the gaps and bridge them with latest advancements followed by market leaders of
the same sector.
From the case analysis, it has been observed that ABC Ltd is enriched in good quality assets and
equipped with well-defined processes and working towards better performance by serving customers
with sustainable service quality management. Major findings of the study are as follows:

• ABC Ltd is making huge use of advanced technology especially in tracing and tracking of vehi-
cles, 24×7 availability to handle queries and developed some unique software which are mobile
friendly and for managing warehouses (WMIS).
• The organization is actively working towards environmental sustainability and resource optimiza-
tion by creating awareness, planting trees, reducing carbon emission, rain water harvesting and
reusing the recycled things.
• The organization is very much concerned about their manpower. They provide them healthy envi-
ronment and develop many training programs to educate and upgrade them from time to time.
• Despite 14 per cent contribution towards GDP, logistics business in India is still not referred as indus-
try. However, millions of employment opportunities are developed by this sector only. In today’s
business world, logistics sector is the backbone and key driver to economic and industrial growth.
• In spite of some weak areas like less advertisement/ branding for their organization, huge depend-
ability on usage of IT and lack of skilled manpower related to specific this area etc., the ABC Ltd
is performing well by providing integrated one stop solution to their clients.

Although there is still scope for ABC Ltd to improve on communications in terms of creating their brand
awareness and to identify some creative and innovative ways to deliver service within cost considerations,
ABC Ltd is providing quality services to their customers with outstanding performance and can be a role
model for other service providers. It has maintained its performance consistently in past. Therefore, this
study can be referred by other LSPs for improving their performance by following similar practices.

Managerial Implications
Major managerial implications of this study are that the organizations are needed to update themselves
as per the market requirements specifically in the era of globalization and technology advancements
Gupta et al. 147S

without compromising with sustainability issues. The organizations need to follow a holistic approach
as per proposed framework in this study for ensuring best service quality to their clients. Most of the
previous studies have ignored sustainability measures in their service quality framework, but present
study has tried to incorporate these issues in proposed framework. However, sustainability measures are
not considered in detail. For this purpose, triple bottom-line approach suggested by Agrawal, Singh and
Murtaza (2016) can be considered as a future scope of study. Apart from remaining issues of sustainabil-
ity, CSR issues can be also considered as part of the future framework. These findings will be highly
useful for industry and professionals; however, for generalization of the findings, some more case-based
studies need to be carried out. Further managerial implications of this study are that for sustainable
service quality management, logistics sector should be more organized, and skilled work force should be
promoted to understand and tap emerging opportunities in logistics sector. Apart from it, government
should also take proactive measures to support this sector to make it more competitive and organized.

Acknowledgements
The authors are grateful to the Chief Editor of the journal and anonymous referees of the article for their extremely
useful suggestions to improve the quality and content of the article. Usual disclaimers apply.

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