Technology Innovation and New Business Models: Can Logistics and Supply Chain Research Accelerate the Evolution?

Published date01 June 2016
Date01 June 2016
Technology Innovation and New Business Models: Can Logistics
and Supply Chain Research Accelerate the Evolution?
Thomas J. Goldsby and Walter Zinn
The Ohio State University
Businesses today are facing an unprecedented rate of change by virtue of disruptive technologies many of which are focused on achieving
reachefciently in the marketplace. Organizations must evolve their business models to leverage the opportunities presented with the
advent of these technologies, yet the pathways to success and failure remain unclear. Researchers of logistics and supply chain management nd
themselves on the front lines for these exciting developments. As editors, we encourage the research community to get aheadof business
actions, inform strategy, and shape the next generation of competition.
Keywords: logistics; supply chain management; innovation; disruptive technology; simulation
How often is it observed that we are living in a time of un-
precedented change,suggesting that the frequency and magni-
tude of change are increasing at levels never before witnessed?
Perhaps it has become clich
e, but the observation has merit in
the logistics and supply chain domains. The late Professor Don-
ald J. Bowersox remarked that the 1990s presented businesspeo-
ple with a Logistical Renaissance,asserting that there have
been more changes in the process of logistics during the past
10 years than in all the decades since the industrial revolution.
Commerce was becoming truly global, with large corporations
seeking distant markets for both supply and demand. Computeri-
zation was sufciently widespread such that intra- and intercom-
pany communication and knowledge sharing became strategic
imperatives. And, this thing called the Internet was connecting
people and organizations in ways that we had never imagined. It
would have been hard to believe that the rate of change could
continue at that pace ... but here we are some 20 years later
and the Renaissance proceeds unabated.
Innovation in technology continues to drive immense change
in logistics and supply chain managementmaking today, per-
haps, the most exciting time in a generation to be a researcher of
logistics or supply chain phenomena. Technological innovation
leads to new ways of doing business as well as entirely new
business models. Take, for instance, the time around the develop-
ment of supermarkets in the United States around 1930. Super-
markets were revolutionary because they were larger stores than
the mom-and-pop and small chain stores with which they com-
peted. Their size allowed consumers to buy a wider assortment
of goods and to save money by buying larger quantities in each
shopping trip. However, because larger stores are typically fur-
ther apart than smaller ones serving the same market and because
larger purchases have to be stored for longer periods of time,
supermarkets only became economically viable when consumers
gained access to automobiles and to refrigerators, as was increas-
ingly the case at that time. The advent of supermarkets forever
changed supply chains, as stores could receive larger and less
frequent orders and deliverers had to make fewer stops.
The number of technologies impacting logistics and supply
chain management today is signicant. We comment on a few
such advents here. First, transportation technology is being
affected in multiple ways by lower oil prices, increased supply
of natural gas and by, simultaneously, the driver shortage and
the development of driverless vehicles. As we know, transporta-
tion decisions do not impact the cost of transportation, alone;
these decisions affect the logistics network, associated costs, and
customer service as well.
Networks, costs, and customer service will also be impacted
by 3D Printing, or additive manufacturing. As this technology
evolves and increasingly sophisticated parts can be produced at
lower costs, opportunities arise to change inventory strategies
and warehouse management. For instance, what would be the
impact on supply chains if Cparts could be produced on-
demand and no longer require long-term warehousing? Will we
witness a deluge of fake parts if they can be easily produced by
anyone with a CAD design and access to a printer?
A third development already making signicant changes in
consumer behavior is omni-channel distribution. Omni-channels
improve service to customers, yet challenge managers to compete
under growing pressure to cut delivery times, adopt new tech-
nologies and, because there is little time to make corrections
when delivery time is so short, reduce error rates. Amazingly,
major retailers are engaged in these strategies today out of com-
petitive necessityyet they openly admit to not knowing how to
yield prots providing such services!
Finally, to this short list we could add a few more, such as
increased visibility in supply chains, the increased usage of
robots in warehouses, and the Internet of Things (IoT). Together,
these and other technological developments point to major
changes in supply chains, logistics systems, and the skills needed
to operate in this new environment. The opportunities to do
meaningful research are endless. We urge our community to con-
sider them. Yet, logistics and supply chain scholars must do
Corresponding author:
Thomas J. Goldsby, Department of Marketing & Logistics, Fisher
College of Business, The Ohio State University, 2100 Neil Avenue,
Columbus, OH (USA) 43210; E-mail:
Journal of Business Logistics, 2016, 37(2): 8081 doi: 10.1111/jbl.12130
© Council of Supply Chain Management Professionals

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