What are the obstacles hindering digital transformation for small and medium enterprise freight logistics service providers? An interpretive structural modeling approach

Abstract

Digital Transformation (DT) allows logistics service providers (LSPs) to gain competitive advantages by reducing costs, and creating customer experience, innovation and efficiency. This paper proposes a systematic framework to analyse the obstacle factors hindering DT of Thailand small and medium enterprises freight LSPs. First, thirteen obstacles are identified through the extensive literature and validated by a panel of experts. Second, a nine-level hierarchical structure is determined based on Interpretive Structural Modelling to demonstrate the complex interrelationships among obstacle factors. Finally, thirteen obstacles are categorized regarding the driving and dependence power by employing Matrix Impact of Cross Multiplication Applied to Classification approach. The results indicate a lack of digital culture being the most important obstacle hindering DT, followed by lack of support and commitment from top management and lack of risk taking initiative. This finding could help LSPs who aim for DT to take appropriate steps to alleviate obstacles.