Adoption of Blockchain Technology Facilitates a Competitive Edge for Logistic Service Providers

Abstract

Blockchain is attracting tremendous attention in the logistics industry on account of its cutting-edge appeal, potential for integration within the sector, and capacity to disrupt established practices. Among other things, blockchain technology promises to open up new horizons in traceability, transparency, accuracy, and safety throughout the supply chain. However, as an emerging technology, blockchain is still relatively nascent, and familiarity with the technology is limited, as are its implementations. In addition, there is a dearth of studies concerning blockchain technology specifically, as it pertains to transport and logistics, as opposed to finance and cryptocurrency. It remains unknown what factors enable blockchain adoption by logistics service providers and how its adoption affects firm performance and capabilities. This research examines extant literature and conducts research on an eminent global transportation company to elucidate the potential influence of blockchain adoption on firm performance. The results of this work support the model that advancing theory-driven and empirical blockchain studies will increase firm capabilities and foster a competitive edge in the emerging digitalized era.

1. Introduction

The technologies that constitute the fourth industrial revolution shift business models, operations, systems, and economies in ways that are vital to enhancing agile and resilient business performance. The growth of digitalization and the development of technologies such as blockchain are categorized as disruptive innovations. In the logistics industry in particular, digital innovations are emerging that challenge logistics service providers (LSPs) to respond to the fast-changing environment and digital economy. The blockchain is among the newest internet-based applications and holds the potential to become a central pillar of a virtual record-keeping asset system with unique characteristics for future industries [1]. These digital developments open new horizons in advanced technology and innovation for the next generation of logistics businesses, illuminating opportunities to enter untapped markets or drastically alter existing ones by displacing or eliminating products or services used daily. The cargo and transportation shipment fields are also facing a transition out of the traditional logistics shipping system towards a centralized and computerized logistics structure [2]. Blockchain technology (BT) represents the next step in this paradigm change, with a promise to affect and address operational complexity issues such as traceability, safety, and accuracy in logistics [3,4].

In the rising global focus on market trends, many authors agree prominent changes are underway, with businesses venturing away from traditional means of conducting their business and towards an increased reliance on digitalization and the utilization of information and communication technology systems on a broader scale [4,5]. Hence, the logistics sector is continuously developing in numerous ways, challenging organizations with innovation and redefining LSPs methods of operation in parallel with Industry 4.0.

In the modern supply chain, BT provides efficiency, security, and responsiveness for firms that adopt and adapt these technologies in the interest of competitive advantage [6]. This strengthens its relevance and demonstrates the inherent advantages of integrating digital innovation into the industry. Future logistics industries will experience technological changes as business procedures and models integrate into all aspects of logistics. Both business procedures and models are important for synchronizing activities amongst supply chain participants, inclusive of both local and foreign logistics and supply chains [5].

Research in BT is relatively new on the scene and predominantly centered in the information and communication technology sector; hence, existing findings may not be generalizable. The logistics literature has identified a lack of understanding of BT disruption in transport and logistics [7]. Namely, little is known about LSPs implementing BT or how companies deal with LSPs adopting BT [2,8]. Thus, prior research has not yet elucidated what factors encourage third-party logistics to adopt BT [8]. Firms and managers need to understand the blockchain adoption decision and the drivers of adoption that empower sustained competitiveness, along with the barriers and challenges associated with investing in BT. This research provides a novel finding in its model of BT adoption in logistics.

In this research, we seek to understand not just the factors that influence BT adoption but also the impact of its adoption on logistics performance. More specifically, this research addresses the following questions:

• Are there any influential factors that influence BT adoption?
• Does BT improve firm capabilities?

The success of logistics firms implementing BT validates the research model, thus enriching our knowledge and study of logistics and BT both theoretically and practically. In theoretical respects, this reliable model demonstrates the relationship between factors and BT adoption and the subsequent impact on performance. The findings of this research shall contribute to managers’ and logisticians’ understanding of blockchain factors adoption performance relationships.

The theoretical foundation that initiates the BT model is presented in Section 2, followed by a description of the research methodology in Section 3. The findings and discussion are presented in Section 4. Finally, the conclusion in Section 5 covers managerial and theoretical implications, research shortcomings, and recommendations.

2. Literature Review

Conceptually, BT is described in terms of interconnected blocks, as shown in Figure 1. Each block has a unique hash reference containing a timestamp of its creation along with other relevant information, which permits a direct link to the preceding “parent” block and on all the way back to the foundation of the stack, the “Genesis Block”, the first block issued for that specific transaction chain. Every node in the computer network must validate all of the transactions captured by performing an action called “Proof-of-Work” [6]. This requires all nodes to be synchronized and arranged in order, which takes substantially more time as blocks stack up in the chain; a larger network of nodes makes for a more complex problem to be solved, meaning it is more difficult to pass through before any modification can occur. Once the solution is approved, all new transaction records are processed and added to a new block; this is termed mining.

Given that the blockchain is immutable, previous blocks cannot be changed, deleted, or destroyed without forcing a recalculation in all subsequent blocks, lowering the likelihood that any link can be manipulated and thus making it a very safe and trustworthy platform for business operations. However, while there is widespread optimism over the future of BT as it relates to finance, particularly regarding bitcoin and cryptocurrencies, it is still a relatively new technology overall. Only recently have scholars investigated the significance of blockchain applications beyond the financial [1].

Like many other emerging technologies, BT is poised to disrupt established business approaches for new value creation; in particular, it promises better capability in LSPs, opportunities to increase environmental and societal sustainability, and organizational developments [9,10,11]. BT studies span many disciplines and domains and have already proven the technology’s benefits.

Table 1. Summary of blockchain attributes.

Key Characteristics	Definition
Decentralized	Multiple systems can use BT to access, track, record, and update system data. Different levels of decentralization can encompass public, private, and permission-based blockchains [5].
Transparent	After achieving network-wide consensus, data recorded on the network is always readily available and can be traced [4].
Immutable and irreversible	Transactions agreed upon are timestamped with the date of their creation and cannot be altered. Every record is permanent [12].
Autonomy	Each node in a blockchain may store, retrieve, and verify data independently, eliminating the need for a centralized server or validating authority.
Open source	All network participants can obtain stored data while maintaining a level of hierarchy.
Anonymous	Individuals are guaranteed anonymity during data transmission between nodes.
Uniqueness	Every new blockchain entry carries its own unique hash code reference.
Provenance and ownership	Digital records are stored for all transactions made, proving the legitimacy of each, and permitting traceability to their origin.
Smart contracts	Upon the occurrence of a particular event, intelligent computer software can facilitate the execution of a contract automating predetermined responses. Rules and remedies are specified for all parties, improving security, reducing processing fees, and accelerating performance [13,14,15].

Source: [1].

summarizes the unique characteristics of BT that positively impact its adoption.

As blockchain develops, business firms in various sectors are investigating to continue gaining advantages and capitalize on emerging opportunities. The literature on BT has demonstrated it to have a broad range of potential innovative applications that promise to shape the field of BT in the future.

Table 2. Blockchain applications and impacts in relation to market sectors.

Sector	Applications of Blockchain	Social Impacts of Blockchain
Manufacturing	Data openness allows use of smart contracts. Production and printing using 3D software. Decentralized networks. Internet of Things (IoT) security networks. Increase IoT links between devices. Support parts manufacturing. Protection and identification of IoT gadgets.	Contributes to transformation of the ecosystems in which manufacturing takes place through using collaborative and dispersed networks. Offers advantages in areas such as timeliness of information, flexible production, allowing for individualized product creation, cutting-edge mechanization, and motivating employees.
Shipment	Logistics and supply chain visibility. Higher degree of traceability and accessibility. Product information accessibility across the supply chain. Product details from reputable sources. Integrity in the process of product certification.	Integrates and connects all corporate processes in a decentralized and verified shipping system. Safer, more competent, and more efficient organization of projects, people, information, payment, and communication, as seen in the marine sector. Oversight of all interactions among the parties involved has the lowest possible latency from distant locations. Offers increased care in protecting user privacy, verifying transactions, and identifying fraudulent activities. Blockchain-based solutions with IoT-enabled smart containers may streamline the entire supply chain by automatically managing exports, financial records, and monitoring of infractions.
Technology	Registration and transaction history. Administration of business processes. Hyperledger framework and data management, smart contracts.	Increases reliability of cloud networks and strengthens security of these systems. Transforms traditional enterprise resource management tools into a reliable framework, creating a more viable supply chain.
Automotive	Ethical sourcing. Prevent “odometer fraud” Supply chain financing ecosystem using hyperledger fabric.	A unified and independent ecosystem that enables seamless and customizable solutions.
Alternative resources	Renewable power trading hubs and smart power grids. Blockchain-based P2P methods of alternative energy trading. Automatic billing of fuel cells for EVs. Exchanging of power between different providers.	Can effect a radical change in the energy industry by paving the way for more transparency, and for safe and effective transmission of energy generated. Ensure energy is allocated efficiently and with full transparency of use and supply. Allow unrestricted customer access to reliable, cheap power at any time or place.
Healthcare	Secure storage of patient records in the cloud. Pharmaco-surveillance. Improving medical record management. Monitoring patient care routes and keeping track of medical devices.	Enhance healthcare data utilization and patient outcomes while decreasing expenses, boosting compliance, and guaranteeing security. Can assist in several areas of healthcare, including neurology, electronic health records, genetic medicine, biomedicine, drug testing, vaccination delivery, and tracking. Monitor blood circulation and the distribution of temperature-sensitive pharmaceuticals.
Food and Agriculture	Decentralized crop insurance. Food safety and supply chain traceability. Reducing overhead as much as possible. Establishing trust and accountability. Increasing transparency across the food distribution system. Authentication tools. A platform for managing commodities that gives farmers more say in the food-production sector. IoT technology solutions enabled by blockchain. Blockchain-based finance supporting regional and small-scale farms. Computerized transaction contracts built on the blockchain. Integration of the hyperledger system in the food industry. Monitoring of food supplier misbehavior throughout the supply chain.	Appropriately allocate resources among all players in agriculture, and improve transparency, security, and privacy of transactions and business information. Facilitate a dependable end-to-end connection between farmers and corporate purchasers. Increase social sustainability through democratizing the supply chain, which prevents food adulteration, guarantees quality and safety, and reduces waste. Assist in implementing a credit rating system that may be used to better monitor and control the food supply chain.
Aircraft	A mobile payment system. Currency trading in the crypto market. Strengthening “additional miles” Reconciling squabbles and balancing accounts over reservations. Cost savings for the consumer during transactions. Joint airport management planning.	Combine RFID and the IoT to potentially revolutionize the aviation sector by improving port monitoring and facilitating the implementation of proper air freight forwarding. Reduce danger and increase security.
Ecommerce	Database, supply chain tracking. Supporting the logistics process with a blockchain-based platform. Blockchain-based B2B digital marketplaces. Fast and secure internet payments using crypto. Electronic commerce across national boundaries via cryptocurrency. A decentralized marketplace. Transactions through cryptocurrency.	Improve payment systems, electronic purchasing, data security, last-mile logistics, and comprehensive risk management; thereby assist in e-transformation.
Education	Protect documents and credentials. Ensure confidentiality of provider identity and security of credentials. Construct an online marketplace where teachers and students may buy and sell educational materials without any central authority. Build a centralized infrastructure for managing database content remotely.	Contribute to institution credibility using decentralized data dissemination, immutable data, and decentralization. Commitment, competence, and reviews create high societal impact among peers.
Fashion	Product provenance information provides secure documentation and sustainable consumption for high-priced goods such as jewels, wine, and art. Ethical and sustainable sourcing. Digital thumb-print.	Regulate compliance with labor and environmental requirements in businesses that use worker self-reporting to supplement external auditors of factory health and safety. Educate customers by telling them exactly where their products originated and whether or not they were acquired in a manner that was kind to both the people who manufactured them and the natural environment.
Tourism and Entertainment	Safeguard digital rights while maintaining equitable payment terms. Loyalty programs and transactions based entirely on BT. Travel solutions to customers.	Reduce telecommunication infrastructure costs, enable tamper-proof transactions, and mitigate systemic hazards to the tourist sector. Make VR-based tourism more productive. Empower ownership security and intellectual licenses, distribution agreements, and safe transactions in the entertainment industry, all of which contribute directly to societal welfare.
Financial	Transfer funds and monetary exchanges. Financial and insurance transactions using the Hyperledger platform. Develop a model of the banking system’s credit based on fractional calculus. Protect the confidentiality of medical practitioners’ personal information and professional credentials. Secure identification. Clearing and updating of records. Directly inject capital into businesses in the form of shares. Market predictions. Value-added tax structure.	Secure, tamper-proof cryptocurrency transactions (such as bitcoins) will have far-reaching effects on access to credit and other financial services. Benefits asset management, trade financing, and value-added tax services in general.

Source: [1].

summarizes existing review articles on BT applications and the social effects that will result from their being implemented in logistics services and in a few other industries that are important to society. The positive effects this process will have on the popularity of BT will continue to expand the global BT market throughout the coming years.

Supply chain companies have utilized business-to-business (B2B) digital channels to satisfy convenience, bringing together vast collections of data in real-time and making it possible for firms to detect various aspects of and maintain client traction momentum [16]. The number of global B2B cross-border transactions conducted via blockchain is forecast to climb significantly in the coming years. In 2020, Asia accounted for almost a third of the overall trade volume. By 2025, cross-border blockchain B2B transactions are expected to reach 745 million, with 466 million blockchain transactions in Europe, making it the second-largest region in blockchain transactions. However, even though most industrial clients now make a significant percentage of their business profits digitally, the e-commerce model is not flawless. Skepticism over the security of business firms’ financial information is warranted, given the many data breaches in recent years [17]. In addition, the inability to trace materials and products throughout the logistics and supply processes has resulted in significant financial losses for some large firms, such as Toyota.

From a technical viewpoint, BT can enable a great level of visibility in logistics and the supply chain (e.g., from the extraction of raw material to the complete service/product, or from importing countries to the export market and wholesalers/retailers), as well as full product traceability for potential buyers [5]. Logistics scholars have documented the following beneficial effects of BT: improving inventory management, strengthening quality management, lowering transaction costs via smart contracts, expanding the transparency of product information and services, building trust, extending relationships between supply chain participants, and allowing automation with real-time transactions and error-free procedures, which may generate cost savings [2]. These enhancements are mediated through several processes, e.g., purchase orders, inventory levels, invoices, received goods and shipping, acquiring and collecting information on product type/material, date, and location, including quantity, quality compliance, and product integrity, which collectively establish product provenance [12]. The decentralized system serves as a central repository for all relevant information, facilitating transparency and ensuring uniformity among all stakeholders engaged in manufacturing, distribution, and management while also providing high security and unalterable information. Indeed, the implementation of BT by LSPs would considerably improve logistics transparency, firm performance, flexibility, and adaptability. Notably, easier transactions hone in on high-quality goods [18].

Bitcoin and other cryptocurrencies are the most well-known applications of BT, but their legitimacy is still hotly contested, and their image has taken a hit due to lacking regulation and the occurrence of fraud. The belief that BT solely belongs to the crypto world drives it to be perceived as unreal and untrustworthy; this perception has bred skepticism, caution, and widespread derision that is reflected on the entire BT system and makes organizations think twice before adopting the technology. Actionable measures are needed to boost confidence, increase public comprehension of the distinction between cryptocurrency and BT, and raise awareness of the latter’s security and trustworthiness. By implementing precautionary measures, reluctant users will gain confidence in BT, adverse effects will be avoided, and their preparedness to use BT will increase.

Current uses of BT also present a lack of standardization and interoperability. Multiple large-scale project operations are using diverse, independent blockchain systems for their disparate operations; there is no standard guideline across all BT ecosystems. Another challenge is the scalability of network technologies, especially public blockchains. Compared with traditional network transactions, of which thousands can be completed per second, blockchain transactions have quite apparent shortcomings. Ultimately, applying BT in organizations will also face a series of problems, significantly limiting its adoption and implementation.

i.

Lack of Awareness and Understanding

Small and medium-sized blockchain enterprises may not comprehend the technology, what it can achieve, or how to manage it, which hinders their efficiency.

ii.

Transparency and Security Concerns

All cryptocurrencies are provided by pseudonyms, but many blockchain applications demand the signing of smart transactions and contracts with real identities, raising security concerns regarding organizational privacy exposure. Many organizations follow statutory privacy regulations, but store data in a common database that may be viewed by anybody. Privacy protection is not limited to the government. However, despite pushes for privacy protection, a new identification framework is still far off.

iii.

Productivity Paradox

Leveraging the blockchain network to increase transaction speed and efficiency is expensive, meaning businesses will utilize the network cautiously. In addition, the value may be lost by processing transactions separately on a larger blockchain network. Blockchain apps must therefore make use of network effects to aid their users and the market as a whole.

Despite the technology’s conceptual value, the full prospects for BT in logistics have largely been overlooked [19]. Existing literature continues to focus primarily on technical or conceptual aspects [20], and hence there remains a gap between BT and LSPs. Notwithstanding efforts in this direction, there is currently no reliable method of assessment nor an established structure by which to properly contextualize research findings [21,22]. Practical concerns in the lack of a proper evaluation tool or framework for corroborative evidence prevent stakeholders from completely committing to blockchain implementation in their digital modernization journey. It is therefore imperative for academics to define the potential of the blockchain.

2.1. Review of BT in Relation to LSPs

The earliest known publication on the subject was released in 2017, when there was just a select group of academics undertaking research on BT in logistics [3,10,21,23,24]. In the following years, the number of published articles steadily increased; nonetheless, researchers investigating BT and its utility in supply chain management and logistics have recently concluded there is not yet enough research on the topic [1]. In addition, the overwhelming majority of completed methodology to date has consisted of largely conceptual papers, with just a few employing qualitative and quantitative approaches.

For example, Agi & Jha [25] investigated factors that will lead to the widespread use of BT in logistics using the Decision-Making Trial and Evaluation Laboratory (DEMATEL) to collect data from experts and conduct an empirical analysis of the relationships between influencing factors. Their work established five enablers, including three main attributes (relative advantage, compatibility, and complexity) and internal and external context-related influences on whether stakeholders have decided to deploy BT. Orji et al. [2] similarly employed the technology, organization, and environment (TOE) theoretical framework to elucidate significant determinants of the effective adoption of BT in freight logistics. They highlighted the following three major elements: availability of specialized blockchain technologies and tools, infrastructural facilities, and government support and policies. It may be especially important to take into account Kühn, Jacob, and Schüller’s findings [19], which indicated that businesses having a theoretical understanding of BT also have a reluctant attitude toward the innovative technology.

2.2. Factors Affecting LSP Adoption of BT

2.2.1. Organizational Readiness

Organizational readiness describes a firm’s capacity in terms of both financial and technical resources, which influence its adoption and utilization of technology [26]. For instance, a firm’s technological capabilities, access to funding for implementation, and availability of personnel with the necessary skill set are all crucial factors [25]. This appears because upper management significantly impacts how the firm uses technology and how open it is to adopting inter-organizational information systems across departments. Indeed, management commitment enables investment of the time, energy, and money required to deploy new technologies and organizational structures [27,28,29].

Li, Ceong, & Lee [30] concluded that LSP firms must plan and invest in BT to assure its acceptance in supply chain management; moreover, an excellent company culture is necessary for maintaining a high degree of perceived credibility concerning the data stored on the hyperledger. In addition, organizational culture and hierarchy may shift when transitioning to new technology, and employees may oppose the transition or be hesitant to adapt. As such, managers need to ensure that staff members have a foundational understanding of the technology for the firm to be ready to transition from outdated to cutting-edge hardware and software.

2.2.2. Transparency

Transparency is a measure of how parties acquire knowledge about a transaction and any third party observing the interaction. For a product to reach the end user, it must first make its way through a complex network that encompasses diverse stakeholders such as extractors, merchants, distributors, and warehousing facilities. An article [31] on the topic of broadening trust, provenance, and greater transparency by using the technologies underlying blockchain suggested transparency as a primary factor in why BT has been adopted in the logistic service provider sector. As a technological advancement, BT can potentially improve supply chain openness and transparency, especially in highly competitive, dispersed, and complex industries.

BT may also lessen the likelihood of errors occurring inside a system and guarantee that any recorded information is correct, unchangeable, and derived from a reliable source. By storing information in private, permissioned ledgers and enabling individual firms to obtain access control over a common dataset, the blockchain platform offers both transparency and privacy, which together provide for a reliable source of information. Notably, blockchain-based networks no longer require combining on-chain data sources with off-chain technologies. Meanwhile, increased transparency installs confidence in those working with the data, assuring them that they are utilizing the most up-to-date, accurate, and reliable dataset possible, thereby enhancing the potential for increased productivity, improved customer service, and decreased expenses. Transparency of process information optimizes the whole system’s reliability, which could also lower costs through reducing errors caused by a lack of communication.

Horizontal cooperation amongst CEP carriers was the focus of a blockchain decision framework described by Hribernik et al. [23], in which salient features of extant blockchain decision models were analyzed along with logistics and last-mile supply chains. According to the findings, a private blockchain network is the most effective method of improving data sharing, data integrity, and transparency. This supports the potential of BT to increase supply chain effectiveness and transparency across all operations linked to logistics [10]. Kückelhaus & Chung [32] likewise published a study regarding the technological potential of blockchain in logistics based on a prototype technology used by a German global logistics operator in the pharmaceutical business. They concluded that BT might have utility in asset allocation to deliver value, consistency, and accountability in the logistics network. Ultimately, all of these studies highlighted transparency as a crucial adoption factor because its lack can cause misunderstandings among involved parties at every layer of the supply chain.

2.2.3. Smart Contracts

Smart contracts are vital components of blockchain-based systems that are employed to autonomously carry out legal obligations that would traditionally be regulated manually. That is, smart contracts enforce rules and process steps mutually agreed upon by the relevant stakeholders. Once initiated, they are fully automatic programs stored within the blockchain, triggering a workflow of actions when predetermined conditions and actions are met. This means all participants can immediately be sure of the outcome without involving an intermediary or necessitating any time loss. Smart contracts allow all assets, including money, to become programmable, unlocking new possibilities for use and contributing to process efficiency and capabilities. A study by Kouhizadeh and Sarkis [33] showed that a dispersed network, data integrity, cryptography, and safety are among the characteristics of blockchains with smart contracts. Yadav and Singh [34] highlighted that smart contracts could eliminate and reduce the need for a middleman or other intermediary and the associated transaction fees and transaction expenses associated with transferring assets. Baharmand & Comes [35] also noted that smart contracts can help increase the efficiency of data storage management and can leverage cutting-edge cloud computing abilities. Accountability, environmental sustainability, and adherence to government regulation are three more areas that may be affected by smart contracts. This includes through boosting the traceability of materials, which would allow management to ensure they are getting authentic raw materials by providing all pertinent details about the commodities’ nature and origin.

The advancements offered by BT may be implemented in two distinct forms, namely, open public blockchains, in which anybody can participate directly, and private permissioned blockchains, in which only safe listed members may participate. Companies today prefer private, permissioned blockchains over public, permissionless ones because the former provides a closed ecosystem of users with enterprise features such as robust access controls and privacy protections [32]. However, scalability can be an issue as managing massive data in real-time increases block size and number, posing challenges for storage [36].

2.2.4. Environment

Environmental elements are those outside management’s immediate control. This research defined the environmental-related activities within a logistical scope, a measure of sustainable innovation performance, and the elements that influence environmental adoption. Beyond firm and supplier chains, the involvement of BT in ecological and social betterment entails more comprehensive regional and international networks. Additionally, BT is less harmful to the environment in terms of saving energy and shifting from dependence on paper to digital data. Thus, investment in BT by logistics and supply chain stakeholders would make the organization’s processing stages more efficient and offer a vast gap advantage over other non-adopting competitors.

2.3. Competitive Advantages of LSPs

2.3.1. Security

The term “security” refers to a proposal for using BT in an automated logistics network, which includes the principle of operation, consensus authentication procedure, record stores, and retrieval so as to achieve non-repudiation proof and traceability of corporate actions and activities. Fu and Zhu [37] analyzed security concerns and the potential for personal information to be compromised during the operation process of linked data for intelligent logistics systems. Tijan et al. [10] put forth an approach for handling sensitive information that ensures users retain full control of their data while also being decentralized. In addition, being able to both store data and perform intensive processing off-chain allowed LSPs to improve the efficiency of BT. This demonstrates that blockchain can improve the safety of information sensitive to privacy, allowing individuals to share information with other users while using cryptography to protect their anonymity.

Logistic service providers have suggested that integrating blockchain, IoT, and machine learning developments might help the supply chain run smoothly. In LSP usage of BT, only data references and simple processing activities need to be handled. The following three safeguards may protect these data and activities from privacy concerns: data ownership, openness, activity tracking, and selective access. With these safeguards implemented, blockchain can enhance the safety of distributed networks and improve the reliability of safety infrastructure. Additionally, BT can potentially improve the safety of private and sensitive data held by industry leaders in the logistics service sector. Lim et al. [4] offered a comprehensive systematic view of topics, methodology, and industries pertinent to the implementation of BT in logistics. Further relevant research in this area, particularly concerning data, information conveyance, and safeguarding blockchain networks, remains an important need.

2.3.2. Reduced Transaction Costs

Logistics service providers have widely recognized that BT reduces expenses incurred by the industry. In particular, Agi and Jha [25] suggest that BT offers a possible drastic reduction in the expenses of transactions conducted amongst the various actors in a supply chain due to precluding the need for intermediaries and providing the ability to leverage smart contracts. The database on the blockchain is accessible to all involved, and everyone takes part in the process of validating transactions. Manipulation of information is impossible; redundancy and cross-checking tasks ensure that all transactions are safe and reliable. For any financial disagreement, firms can bargain with their counterparts without having a third party involved. Hence, BT can assist logistics companies in saving on administrative fees, transaction costs, and time costs. LSPs can realize the benefits of reduced transaction costs by using BT under appropriate circumstances (suitable operational standards, policy measures, and governing regulations).

2.3.3. Efficiency

BT helps boost operational and supply chain efficiency so that logistics companies can achieve a competitive global market advantage. The need for performance-driven automation has become considerably more widespread as a direct consequence of the pandemic. Automation enables stakeholders to perform transactions directly and independently, eliminating the need for the participation of any third parties, which in turn helps to build global supply chains. Automation also facilitates improved connection of supply chain and financial services and enhanced data sharing among many stakeholders. Automated payment solutions shorten the amount of time that passes between a customer placing an order and the subsequent processing of their payment, guaranteeing that products are transported appropriately and on schedule. Finally, logistics companies may enhance compliance, minimize legal expenses and penalties for late tax payments, and combat counterfeiting and fraud through using BT.

2.3.4. Transparency

BT helps LSP companies promote transparency to achieve a competitive global market advantage. That is, as information is shared on the blockchain, companies become more transparent. Since everyone can access a document, amendments must be made unanimously. Additionally, the decentralized blockchain is more reliable and consistent. This leads data on the blockchain to be more accurate and consistent. In addition, there is significant room for improving visibility and accuracy in logistics, implementing digital properties, and creating an unchangeable inventory of all transactions; BT may be used by LSPs to trace items from the time they are manufactured until the point at which they are either delivered to or utilized by a customer. Such increased exposure in the logistics industry would be beneficial to both the companies and the customers they serve; in using BT to track the movement of raw materials and completed products as they transit through each subcontractor, organizations may reduce revenue losses due to counterfeit and black-market trade and enhance end-user confidence. Thus, the use of BT provided by LSPs would also improve supply chain visibility more broadly, helping to prevent fraud in the supply of precious commodities such as diamonds and pharmaceuticals.

A holistic view of existing studies reveals a model, illustrated in Figure 2, for future investigations to determine an appropriate instrument for evaluating BT and examine factors that influence adoption and successful implementation, with the ultimate goal of determining BT adoption and associated increases in performance and competitive advantage.

3. Methodology

The term “research methodology” can be defined as the strategies and methodologies applied for data analysis, extending beyond general assumptions to precise ways of collecting and reasoning. The scope of a research methodology thus consists of relevant theories, strategies, and accurate methods.

This research uses a case study interview approach to understand BT applications among LSPs, the factors and obstacles moderating uptake of BT, and the effects of BT on performance and competitive advantage. The research allows for the investigation of a genuine problem in a particular setting using various data resources [38]. In most cases, the purpose of a study is to assess a clearly defined issue utilizing a methodology that uses reliable facts to determine what variables would apply if the situation were to occur in real life. This methodology also develops various research skills, such as proposing and evaluating alternatives by which to improve an issue.

The most reliable information is obtained from a representative sample through direct observation, from personal experience, or from official records. Thus, we conducted an in-depth interview with a blockchain engineer specializing in BT and logistics who was eager to share the company’s affairs and gain insights into the problem under study. In-depth knowledge of a subject can be effectively gained through a working professional’s point of view rather than via questionnaires or reviews. Generally, the results of qualitative methods are more descriptive, and conclusions can be drawn from the obtained information reasonably straightforwardly.

3.1. Sample Description

Founded in 1973, this corporation has made transportation, logistics, and storage its core areas of operation since its inception. Its operations are accomplished using international mail, express, air and ocean freight transportation, road and rail transportation, contract logistics, and international express. It employs more than 275,000 individuals throughout its global network, stretching over 220 nations and territories. Consequently, it can deliver world-class service to clients by accommodating their logistics and supply chain needs.

3.2. Questions during the Research

During the study, the following research questions (

Table 3. Research findings.

Question	Summary of Data Extracted
When exactly did the company make use of BT?	Early 2018. Unveiled a blockchain-based serialization prototype with nodes in six different locations. Functioning prototype tracks medications from point of origin to consumer and distributes the information with multiple stakeholders.
How has the company been using BT?	Increasing trust and openness among stakeholders and customers. Automating commercial operations. Transparency and product traceability throughout the manufacturing process. Proof of authenticity. Track-and-trace capabilities. Blockchain-based smart contracts to automate commercial processes.
What are the drivers of BT?	Micropayments, certifications, and digital identities. Work efficiency. Reliability. Security. Cyber-security. Real-time information sharing. Traceability and visibility. Transparency. Cost-based performance (costs of engineering modification, manufacturing, and quality). Time-based performance (production lead time, delivery speed and dependability, and inventory turnover-rate).
What are the limitations of BT?	Traditional working-style of approach. Refusal to adapt and change mindset.
What are some examples of how BT has been successfully implemented?	Provide training to employees to improve understanding of the new technology. Build predictability. Generate confidence and drive adoption.
How does BT affect the company’s performance and competitive advantage?	Influences the entire process of operation by enhancing speed of processes. Eliminates human registration and verification. Automates supply chain operations. Time efficiency. Lacks requirement to monitor and trace data and flows. Reduces costs and time. Reduces human error. Sustainability. Eliminates fraud and errors. Improves inventory management. Lowers need for couriers.
How can we grow and enhance the implementation of BT in the logistics industry?	Require regulated systems. Develop new protocols for constant updates on newer permissioned blockchain.
What is the solution to the issue of BTs high energy consumption?	Further developments and research.
What is the long-term potential for this technology to help the firm maintain its current competitive advantage?	Supply chain transparency. Automating administrative systems. Technology development. Organizational transformation. Cooperation amongst stakeholders.

) were asked of a blockchain engineer who specializes in BT from the logistics department of ABC Logistics & Transportation Company. Table 3 also summarizes the findings collected during the study.

4. Results and Discussion

4.1. The Perception of Blockchain within the Case Logistics Firm

Our research reveals that the case logistics firm has critically observed the technology and market traction, as no fully operational blockchain-based utilities were tested in practice during the rise of blockchain. The LSP did not start employing BT until 2018, when it announced a serialization prototype built on BT with nodes situated in six distinct locations as part of a partnership with a global professional service company known for its technology, consulting, and outsourcing services. A concerted effort among many stakeholders resulted in the development of a prototype with working functionality that can monitor the movement of pharmaceutical drugs as they are sent from their point of manufacture to the end user. Thus, this investigation finds BT is still in its infancy when it comes to implementation, with a very modest rate of blockchain acceptance despite the desire to use BT [1,3,23].

Among other things, BT can contribute to improved record-keeping for every product through the value chain, tracking orders, and the management of physical and digital assets in tandem through a single system to increase output and productivity. In addition, since BT is decentralized, it can effectively remove the need for intermediaries. Conversely, blockchain also facilitates more robust and effective inter-organizational partnerships, particularly in complex networks. These findings confirm the arguments of past research concerning smart contracts and transparency [33,34,35]. The nature of BT makes it possible for actors to participate in transactions in a manner that is both more timely and efficient, even as a vast amount of information is being shared across entities. Ultimately, the LSPs adoption of BT and its application in logistical operations provides several beneficial outcomes, including more significant levels of anonymity, decreased likelihood of errors or delays, increased immutability, and transparency, accelerated transaction times, and lower overall costs and waste, all of which are consistent with previous studies.

The increased trust and transparency revolutionize the case logistics company’s approach to the business it provides stakeholders and consumers and the automation of its commercial operations. Within the framework of complete visibility, product traceability is provided throughout the whole manufacturing process, from initial raw material procurement to final product shipment. The collected information may be used as evidence of authenticity and to improve tracking and tracing capabilities. Beyond this increase in overall transparency, the logistics firm also offers its clients smart contracts built on BT, which can be used to automate and streamline business procedures. This indicates that financial transactions may run independently without the involvement of a human being.

4.2. BT Adoption Factors

Several points were raised by the engineer during the research session regarding the inherent benefits of BT and how the company’s employees perceived those benefits. Increasing operational productivity, self-governance, and safeguarding the company network while decreasing time spent on administrative tasks are all significant motivators for businesses. BT offers a higher level of safety, privacy, and cyber security and enables the introduction of micropayments, certificates of authentication, and digital identities. In addition, the blockchain allows critical stakeholders to access real-time data through a secure and reliable framework and so track inventory movement across many parts of the logistics and supply chain processes. Moreover, a blockchain-verified document is unable to be changed once it has been produced, ensuring there is no single point of failure and that neither fraudulent acts by individuals nor data tampering by government bodies could occur in the event that interests do not coincide with one another [39]. Any logistics company might utilize this information as a business tool to provide a certification of legality for the shipment process; for instance, premium items may have their authenticity confirmed by a thorough auditing process. These findings all confirm the arguments of past research concerning IT security [10,37]. Consumers benefit from these processes because they can acquire additional knowledge regarding the products in which they invest their money, for example, whether a product was acquired in a morally questionable way, whether it is legitimate, or whether it has been appropriately preserved. As such, the blockchain offers an opportunity to boost client loyalty and profitability.

In addition to security improvements, logistics and supply chain efficiency may be improved through the unique qualities offered by digital innovation. High data security, dependability and visibility, provenance, and reduced resource wastage are some of the implications of blockchain as a digital and emerging innovation technology for the LSP sector. In particular, strong cryptographic techniques are necessary to guarantee data integrity, the absence of duplicate transactions, and the enforcement of clearly stated access permissions. Given that the vast majority of the system’s stakeholders must approve each transaction on the blockchain, fraudulent transactions do not have a chance of making it through collective verification. Moreover, a record that has been generated and confirmed cannot later be altered. Therefore, the robust and methodical nature of the blockchain system inherently guarantees that data in the system is reliable and traceable to all parties involved. This allows logistics providers to benefit from using BT to streamline operations, enhance efficiency, lessen the burden of paperwork, cut down on waste, and speed up the identification and resolution of problems.

An organization’s operational success is grounded on the following three pillars of strength: infrastructure, procedures, and competencies. The infrastructure resources owned by a firm are referred to as its assets, which may be physical or intangible. Procedures are actions that put these resources to use, and competencies are the talents required to carry out routines. Companies benefit substantially from building a business strategy with these three methods as a model framework for adopting BT. When evaluating performance within this framework, operational performance is broken down into the following two categories: (i) performance relating to time and (ii) performance based on cost. Cost-based performance considers several criteria, including the cost of technical developments, manufacturing, and the standard quality price. Meanwhile, a time-based performance that correlates with success in production latency, quality of the service, consistency, and inventory levels, among other factors.

The studied LSP also acknowledged the inadequacies of BT, which hindered the implementation of a new system and ultimately exacerbated concerns. Many employees are accustomed to the traditional working method, and it can be challenging to alter their perspectives. Older systems frequently lack support for direct interfaces with the blockchain, which necessitates a significant amount of reconfiguration [25,30]. Due to blockchain’s immense complexity, conventional approaches to LSP methods do not translate directly; rather, they are inefficient and counterproductive. Ultimately, the relevance and pervasiveness of already-applied technology within its ecosystem constrain the uptake of new technology, leading to problems such as delays, the ambiguity of usage, and an unwillingness to adapt to the new environment.

4.3. Factors Affecting Success in Implementing BT

The major impediment to the adoption of BT was apprehension among workers and lower management, along with reluctance among some parts of upper management, as cited by the LSP. This resistance stemmed from employees feeling content with the method they were employing at the time. The most crucial part of successfully integrating BT is getting the staff on board with the innovation via presentations, seminars, and discussions that orient them with the technology and ensure they are comfortable with it. The LSP studied here reported extensive training to have had a considerable impact on the management structure, including employee mentalities concerning the proposed approach. Success resulted from the active involvement of parties in revamping existing procedures and embracing new approaches to collaboratively produce logistical value. Thus, it is essential to increase knowledge and understanding of new technologies, particularly among employees and team members of organizations, so as to build predictability. Additionally, it is necessary to reassure users about the safety of the new technology in order to generate confidence and drive adoption, as adoption in turn drives success. When comparing a company that has had only limited exposure to BT to a business that has had both exposure and experience, the latter organization comes out on top [27,28,29].

4.4. Impact on Performance and Competitive Advantage

A firm’s competitive edge refers to its capacity to utilize its resources to outperform rivals while simultaneously realizing its strategic objectives and maximizing its revenue and market share. It therefore further refers to a set of notions or what are thought to be skills, abilities, and initiatives for harnessing resources in a bid to assess competitors and the effectiveness of their tactics so as to stay ahead [40,41]. A firm’s performance can be influenced by the application of infrastructure tools and resources, which may reduce the amount spent on operating expenses. In this study, it was observed that blockchain substantially affects the overall operation process, specifically by optimizing production output.

Through digitizing processes that were previously conducted manually and relied on paper records, blockchain eliminates the need for these inefficient methods. The studied LSPs strategy based on BT and smart contracts eliminates the need for human registration and verification while also enabling the automation of operations and activities across the supply chain. This will ultimately result in enhanced time efficiency. Due to not having to monitor and track data and flows caused by the involvement of intermediary partners, the LSP reported decreases in both expenses and demands on employee time. Ultimately, all parties involved in shipping reap the rewards of BT implementation in the following ways: increased overall sustainability; efficiency gains in tracking inventory; eradication of misconduct; reduced need to spend on courier services; reduced delays caused by paperwork; reduced waste; expedited identification of problems. These key advantages have proven a favorable influence on the performance of the case logistics firm, helping to sustain the company’s competitive edge in the logistics market.

4.5. Growth and Expansion

Several aspects need to be considered to ensure that BT has reached its maturity potential and can be used extensively throughout the industry. As reported by the blockchain engineer, current issues that need to be considered include newer permissioned blockchains, new protocols for representing transactions on a block, and future new regulations to govern the system. The foremost issue with blockchain is striking a balance between the number of nodes and the cost to users. At present, the blockchain cannot operate successfully without the participation of nodes to maintain its integrity, meaning expenses are more significant than necessary, charging more and taking longer to complete transactions; thus, the nodes’ inefficiency drives up prices.

However, these difficulties are still being actively rectified. For the foreseeable future, it is essential to continue exploring blockchain development and applications in various sectors, as this emerging technology can address various fundamental difficulties that hinder and restrict system performance. If the node-cost tradeoff could be resolved, the technology’s implementation would be optimized and its adverse effects mitigated.

4.6. Sustainability Concerns and Future Implications

One concern that is considered a significant downside to BT is its heavy energy consumption. The case logistics company shared its opinion on the problem, with the blockchain engineer asserting concern about the energy and computational power consumption needed for some applications. In particular, maintaining a real-time ledger consumes a lot of electricity. Blockchain transparency is achieved by the simultaneous connection of all newly generated nodes to all existing nodes. For the network to function, miners must constantly try to solve a vast number of algorithms to verify every transaction, necessitating the allocation of a considerable amount of computer processing power. The high computational requirements of the cryptographic systems used to sign each transaction are also cause for concern [42]. To completely realize the promise of BT in the logistics sector and achieve its widespread adoption at a reasonable price, logistics firms will need to do considerable field research and development to find a solution to the problem of excessive energy utilization.

Lastly, the study concluded with thoughts on the future of BT and whether this technology can stay ahead of the competition in the years to come. Blockchain’s potential applications in the real world for monitoring, authentication, and privacy can open up new supply routes that might be exploited for competitive advantage. Awareness of blockchain and the innovation it brings has led the logistics company studied here to establish an advantage in the current logistics industry. However, the blockchain engineer also stated that realizing effective solutions to current problems and maintaining the competitive edge for this firm in the long term would entail further technology developments, organizational reform, and, most significantly, collaboration among all stakeholders. Any blockchain endeavor at a logistics company needs these elements to succeed. As such, it is essential to provide key stakeholders and individual contributors with the resources necessary for innovation and collaboration (including but not limited to time, tools, and knowledge). Internal and external stakeholders must undergo significant process change as part of this initiative.

5. Conclusions

This research represents a novel effort in understanding the performance and competitiveness of LSPs who invest in or implement BT. It extracts theoretical foundations from existing literature to construct a model of LSP performance in relation to blockchain, including adoption factors leading to and barriers hindering successful implementation, adoption status, and impact on performance. Empirical evidence is explored to elucidate the performance and competitiveness of LSPs implementing BT. The results highlight key drivers of BT adoption, including inherent features such as reliability, real-time execution, transparency, security, traceability, visibility, and efficiency. Such attributes of the blockchain are also a source of competitive advantage. These findings confirm the research model and further highlight traditional working styles and resistance to change as two critical barriers to BT adoption. In addition, this research provides empirical evidence regarding the current status of BT adoption in logistics and highlights the need for continuous improvement of employee education and training and ongoing research and development. Ultimately, the following five aspects of BT were found to confer resilience in performance: supply chain transparency, automation, technology development, organization transformation, and stakeholder participation. This research can be generalized to other logistics industries.

The research contributes knowledge and advances previous studies on the competitive advantages of LSPs in relation to logistics 4.0 and technology implementation. The strong connection between the relevance of BT and firm success adds weight to the future challenges of LSPs in the digital era and current risky environment. In particular, it supports the idea that a firm’s dynamic capability to enhance logistics services can be explained by its innovation capability, exemplified through technology adoption. The findings of this research shall help LSPs who want to adopt blockchain in the future by guiding their understanding of related factors and barriers, successful implementation, and effects on performance. Notably, these effects vary over time, and therefore managers must put time and effort into enhancing their understanding of BTs impacts.

Naturally, this research contributes insight into understanding real life, not how factors impact performance. Despite its limitations, it validates the attributes of blockchain as a competitive advantage that competitors can easily leverage over time. The research model used here is still insufficient to fully elucidate factors that influence BT adoption by LSPs and how they affect performance or competitiveness. Therefore, more empirical evidence concerning BT in logistics are yet needed. Different research approaches, such as surveys and focus groups, could develop and test the relevant theoretical constructs and hypotheses.

Overall, the findings call for future investigation in both similar and different industries to understand how firms develop their capabilities through blockchain. Further integration with moderator and mediator effects will open a new and crucial avenue for continuing research that is indispensable to academia, logisticians, and managers.