INNOVATION CAPABILITIES, LOGISTICS SERVICE QUALITY AND BUSINESS PERFORMANCE OF THE THIRD PARTY LOGISTICS (3PL) SERVICE PROVIDERS IN MALAYSIA

Abstract

The Malaysian Government Transformation Programme states that transportation is one of the national priority areas. It plays a significant role in the country‟s well-being. The role and contribution of transportation is important in strategic business and it is also one of the key focal points in the Eleventh Malaysia Plan for 2016 to 2020. Moving forward, while the prospects for Malaysia‟s logistics industry are positive, there is still much room for improvement in terms of business performance. Most enterprises that sell or produce goods require facilitating agencies such as third-party logistics (3PL) service providers to assist them in transporting their products and services from one destination to another until they reach the end customers. Therefore, this study attempts to identify the factors affecting innovation capabilities; namely management, service, technology, marketing, and process that may contribute to improved business performance and have an effect towards the role of logistics service quality as the mediator of the relationship between innovation capability and the business performance of 3PL service providers in Malaysia