THE ROLE OF THIRD PARTY LOGISTICS PROVIDERS AS ORCHESTRATORS IN EMERGING MARKETS

Abstract

The role of third party logistics service providers (3PLs) in emerging markets are changing, impacting their value adding role as orchestrators within supply chains. 3PLs are changing in terms of their engagement with customers, the services that they render and the way that they add value to their customers. The purpose of this generic qualitative study was to explore the orchestrating role of 3PLs in the United Arab Emirates (UAE). Eleven participants from five organisations took part in semi-structured interviews. In the emerging market, 3PLs act as orchestrators by creating value in terms of process capability, supply chain visibility, operational neutrality and customer collaboration. The study shows that 3PLs' views of value creation in the UAE are embedded in logistics capability. most emphasis of value creation is placed on fostering supply chain visibility and promoting customer collaboration. The study contributes to the existing body of knowledge in terms of 3PL orchestration. It highlights strong similarities to developed markets regarding customer collaboration and supply chain visibility, but differs in terms of process standardisation when it comes to creating value as a 3PL orchestrator. Organisations can benefit from the research findings to leverage the capabilities of 3PLs to their advantage. 3PLs may benefit from knowing which attributes contribute to value creation in the local market toward advancing their role as orchestrators of supply chains in the UAE.

Full text

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ABSTRACT
e role of third party logistics service providers
(3PLs) in emerging markets are changing,
impacting their value adding role as orchestrators
within supply chains. 3PLs are changing in terms
of their engagement with customers, the services
that they render and the way that they add value
to their customers. e purpose of this generic
qualitative study was to explore the orchestrating
role of 3PLs in the United Arab Emirates (UAE).
Eleven participants from ve organisations
took part in semi-structured interviews. In the
emerging market, 3PLs act as orchestrators by
creating value in terms of process capability,
supply chain visibility, operational neutrality
and customer collaboration. e study shows
that 3PLs’ views of value creation in the UAE are
embedded in logistics capability. Most emphasis of
value creation is placed on fostering supply chain
visibility and promoting customer collaboration.
e study contributes to the existing body
of knowledge in terms of 3PL orchestration.
It highlights strong similarities to developed
markets regarding customer collaboration and
supply chain visibility, but diers in terms of
process standardisation when it comes to creating
value as a 3PL orchestrator. Organisations can
benet from the research ndings to leverage the
capabilities of 3PLs to their advantage. 3PLs may
benet from knowing which attributes contribute
to value creation in the local market toward
advancing their role as orchestrators of supply
chains in the UAE.
Keywords: Emerging markets, supply chain or-
chestration, third party logistics, United Arab
Emirates.
INTRODUCTION AND PROBLEM STATE
MENT
In the annual Agility Emerging Markets Logistics
Index of 2016, the UAE is ranked, aer China,
as the second fastest growing global emerging
market with a gross domestic product of over
$300 billion (Agility, 2016:5). Within this market,
3PLs continue to play a major role within global
supply chains and within the region (Agility,
2016:5). Early in the new millennium, the 3PLs
in the UAE have grown substantially, both in
terms of capacity and size, and their role in
local organisations therefore has to be better
understood (Sohail, Anwar, Chowdhury &
THE ROLE OF THIRD PARTY LOGISTICS PROVIDERS AS
ORCHESTRATORS IN EMERGING MARKETS
W. Niemann
University of Pretoria
Pretoria, South Africa
E-mail: wesley.niemann@up.ac.za
A. Meyer
University of Pretoria
Pretoria, South Africa
E-mail: arno.meyer@up.ac.za
T. Kotzé
University of Pretoria
Pretoria, South Africa
E-mail: theuns.kotze@up.ac.za
J. Odendaal
University of Pretoria
Pretoria, South Africa
E-mail: u21046272@tuks.co.za

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Farhat, 2005:23).
Azad, Dhayanidhi and Narashiman (2011:34)
state that the contemporary role of 3PLs in
organisations ranges from basic outsourced
contract logistics to advanced engagement with
organisations, acting as orchestrators, integrators
or Fourth Party Logistics service providers (4PLs)
within organisations’ supply chains. ere has not
been much research done over the past decade
on 3PLs engagement with organisations in the
UAE (Azad et al., 2011:35). 3PLs in the UAE have
mainly specialised in traditional logistics oerings
such as warehousing, traditional transport and
freight forwarding (Azad et al., 2011:35; Sohail
et al., 2005:23). As many as two-thirds of the
organisations in the UAE are reported to make
use of 3PL services, indicating the importance
of 3PLs within the region (Azad et al., 2011:33).
Globally, the roles that 3PLs play and the value that
they add in supply chains are many and varied.
For instance, they can play a transactional role in
order to reduce a rm’s supply chain costs or to
improve services (Heiyantuduwa, Wannisingha
& Rupasinghe, 2015:2).
Organisations can strategically outsource
multiple functions of their business to 3PLs where
the 3PL plays a relational role that focuses on a
partnership for strategic advantage (Jayaram &
Tan, 2010:264; Nemoto & Tezuka, 2007:5). 3PLs
can also play a more advanced role where they
act as a customer developer or logistics integrator
where the internal resources might be lacking
within a rm (Hertz & Alfredsson, 2003:141). A
3PL rm can take on the role of an orchestrator
that manages and coordinates the value creation
network, similar to that of a 4PL service provider
(Zacharia, Sanders & Nix, 2011:40).
3PLs play an important role within organisations’
supply chains in the UAE (Langley, 2016:4).
Network orchestration is dened as a hub rm
acting as a coordinator of logistics network
activities (Dhanaraj & Parkhe, 2006:662; Zacharia
et al., 2011:40). Network orchestration adds value
to an organisation through integration rather than
specialisation, by eectively balancing control
with enablement of customers and suppliers
(Fung, Fung & Wind, 2009:299). 3PLs have been
acting more as supply chain orchestrators by
coordinating supply chain activities (Langley, van
Dort, Ang & Sykes, 2005:105). (Langley, 2016:18)
states that 3PLs increasingly play a vital role in
supply chains and that the strategic orchestration
of activities along the supply chain is becoming
more critical.
3PLs are required to play a more dynamic role
within these emerging markets as orchestrators
of supply chain activities (Liu, 2014:404).
Understanding this role will expand the existing
body of academic knowledge in exploring the
role of 3PLs in emerging markets. e logistics
industry can benet from this knowledge by
understanding the evolving role of 3PLs within
emerging markets.
Zacharia et al. (2011:40-54) introduced a model
that can be used to dene how value is created by
3PLs and how their role within an organisation’s
supply chain can be understood. e model
denes how value is added to an organisation in
the transportation industry within a developed
market. It illustrates value creation, built additively
on four elements, namely: standardisation,
visibility, neutral arbitrator and collaborator,
which dened a 3PL as an orchestrator. Min,
DeMond and Joo (2013:65) highlight the
limitation of the above mentioned study’s
regional focus and mentions that the model could
be applied to emerging markets. Liu (2014:404)
states that there is a gap in research as to what
the role of 3PLs as supply chain orchestrators is,
especially in growing markets like China. e
same could be said for other emerging markets
like the UAE.
e purpose of this generic qualitative study was
to explore the orchestrating role of 3PL service
providers in the UAE and determine how 3PLs add
value to the organisations they provide services
to. e study replicated the study of Zacharia
et al. (2011:40-54) in the logistics industry in
the UAE. e study’s purpose was achieved by
understanding existing 3PL organisations’ views
on the value adding role that they play within the
emerging UAE market. e research involved
semi-structured interviews with senior managers
from several 3PLs in the UAE.
e study aimed to answer the following research

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questions:
• How can the orchestrating role of 3PL service
providers in the UAE be dened in terms of
their value creation?
• What are the factors that inuence the
orchestrating role of 3PLs in the UAE?
• How do 3PL organisations view value creation
in the UAE?
• What are the attributes that 3PLs contribute
to value creation in the UAE?
e study adds value by enhancing the academic
understanding of how 3PLs add value to
organisations in emerging markets by expanding
on the regional study done by (Zacharia et al.,
2011:40-54). It also contributes to the body of
knowledge in that the orchestrating role of 3PLs
is dierent in comparing emerging and developed
markets and can guide further research toward the
better understanding the contemporary role that
3PLs have within such markets. Organisations
that make use of 3PL services can benet from
the research ndings to leverage the capabilities
of 3PLs to their advantage. 3PLs will benet from
knowing which attributes contribute to value
creation in the local market toward advancing
their role as orchestrators of supply chains in the
UAE.
LITERATURE REVIEW
3PLs provide outsourced logistics services and
play the role of movers of goods between the
buyer and the supplier in today’s supply chains
(Crum & Daugherty, 2011:23). e evolving
roles and nature of 3PLs within supply chains are
examined further in the subsequent sections of
this literature review.
Roles of 3PLs in supply chain management
3PLs can be dened as the outsourcing of
logistics activities as a service to independent
organisations who are neither consignors nor
consignees (Omotayo & Melan, 2015:3). Table 1
summarises studies which describe and/or dene
the roles that 3PLs have within organisations’
supply chains. Hertz and Alfredsson (2003:4)
state that a 3PL organisation’s role in a supply
chain and the subsequent value that it adds can be
standard, a service developer, a customer adaptor
or a customer developer. is classication
scheme was re-evaluated by Vasiliauskas and
Jakubauskas (2007:71), who state that the value
that 3PLs add to organisations are rather linked
with information and knowledge compared to
traditional service oerings. e researchers used
the above mentioned classication scheme as well
as their own interpretation of the literature which
have been reviewed, and divided each into the
following ve categories as summarised in Table
1 and described below:
• Core competency (i.e., organisations
outsourced logistics functions to focus on
their internal core competency);
• Functional outsourcing (e.g., transport,
warehousing, inventory management);
• Complementary roles (e.g., inventory control,
procurement);
• Strategic or collaborative partnerships;
• 4PL, integrator, orchestrator (i.e., 3PLs role of
overseeing and overall management of supply
chain functions).
Section 2.1.1 through 2.1.4 discuss the roles of 3PL
service providers in terms of core competency,
functional outsourcing, complementary and
strategic or collaborative partnerships.
Core competency role of 3PLs
According to Min and Joo (2006:259),
organisations that have developed logistics
competency outsource functions such as
warehousing and distribution to focus more on
their central and core business competencies.
is was done in an eort to improve their service
oering, gain a competitive advantage through
market share and save costs within their respective
supply chains (Min & Joo, 2006:259; Stank, Davis
& Fugate, 2005:29). e core competency role
refers to the fact that organisations that have
insourced logistics competency would consider
to outsource these logistics functions to 3PLs.
Hilletoh and Hilmola (2010:47) state that the
integrated warehousing and transportation
services provided by 3PLs have to be scaled and
customised to t customers’ needs in order to
be more ecient in core service provision. Most
3PLs have core and specialised service oerings
to dierentiate themselves, adding value through
oering services such as packaging recycling and

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TABLE 1: THE ROLES OF 3PLS IN SUPPLY CHAIN MANAGEMENT
Basic and intermediate roles Advanced
roles
Core
Competency
Functional
outsourcing
(e.g.,
Transport,
Warehousing,
Inventory
management)
Complementary
roles (e.g.,
Inventory
control,
procurement)
Strategic or
collaborative
partnership
4PL,
integrator,
orchestrator
(Gattorna, 2003) X
(Stank, Davis &
Fugate, 2005) X
(Bottani & Rizzi,
2006) X X
(Min & Joo,
2006) X
(Sahay,
Mukhopadhyay
& Setaputra,
2006)
X X
(Naim, Potter,
Mason &
Bateman, 2006)
X X
(Selviaridis &
Spring, 2007) X X X
(Vasiliauskas
& Jakubauskas,
2007)
X X
(Aguezzoul,
2007) X X
(Miyashita,
2009) X
(Hilletoh &
Hilmola, 2010) X X
(Crum &
Daugherty, 2011) X X
(Zacharia,
Sanders & Nix,
2011)
X
(Chu & Wang,
2012) X
(Pinna & Carrus,
2012) X
(Schmoltzi &
Wallenburg,
2012)
X

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(Vivaldini &
Pires, 2013) X
(Su & Ke, 2013) X
(Jayant, 2013) X
(Klapalová,
2012)
X *Reverse
Logistics X
(Sweeney et al.,
2013)
X *Vertical
integration,
(Saglietto, 2013) X
(Aguezzoul,
2014) X
(Omotayo &
Melan, 2015) X
(Huo, Ye & Zhao,
2015) X X
(Abidi, de Leeuw
& Klumpp, 2015) X
(Yang & Zhao,
2016) X X
Source: Authors’ own compilation
TABLE 1: THE ROLES OF 3PLS IN SUPPLY CHAIN MANAGEMENT CONT.
call centre activities (Aguezzoul, 2014:70). 3PLs
can take on this role where organisations want
to outsource a part of their business that would
otherwise be a core role within their organisation.
Functional outsourcing role of 3PLs
Aguezzoul (2007:7) argues that over and above
organisations outsourcing logistics functions
such as warehousing and packaging recycling
as core competencies, they outsource these
logistics functions as a non-core business activity.
e functional outsourcing role implies that
organisations outsource a logistics service as a
bolt-on service within their supply chain 3PLs,
which doesn’t form part of an organisation’s
core competency. Bottani and Rizzi (2006:296)
found that outsourced logistics services mainly
play a value adding role in organisations by
providing basic services such as transportation,
warehousing and freight forwarding, and can also
include manufacturing. e main roles that 3PLs
have played in 2007 have been transportation and
warehousing, which contributed over 61% and
35% respectively of the services that have been
outsourced in the European market. Nearly all
studied organisations made use of functionally
outsourced transportation and warehousing
services in 2009 (Hilletoh & Hilmola, 2010:51).
Some of these and other basic roles are summarised
in Table 2. e stereotypical functional roles that
3PLs have played are transportation, warehousing,
freight forwarding, inventory management,
packaging and reverse logistics. ese roles were
functionally outsourced logistics services to 3PLs
(Vasiliauskas & Jakubauskas, 2007:71).
Complementary role of 3PLs
3PLs can take on the role of providing
complementary service oerings. ese
services supplement traditional services,
such as warehousing and transportation, and
organisations can outsource certain logistics
functions that are complementary to their
business, such as information and communication
technology, order postponement and co-packing
operations (Hilletoh & Hilmola, 2010:47;
Omotayo & Melan, 2015:3). In addition to some
of the functional outsourced logistics functions
mentioned in Section 2.1.2, 3PLs aim to increase
their service oerings and capability within the
supply chains in which they operate in terms
of information technology competency (Naim,
Potter, Mason & Bateman, 2006:296; Omotayo
& Melan, 2015:5). ese complementary service

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oerings may add value to organisations in terms
of the role of outsourced 3PLs services.
Strategic or collaborative role of 3PLs
is role of a 3PL within some organisations
is strategic in nature, where organisations
collaborate with 3PLs rather than just
outsourcing functional logistics services. In an
eort to increase competency and capability
within their supply chains, many organisations
have partnered with 3PLs to gain advantage over
their competitors (Huo, Ye & Zhao, 2015:161-
163). Strategic partnering between organisations
and 3PLs have been well established in areas like
reverse logistics provision to improve product
quality and reduce cost (Govindan, Soleimani &
Kannan, 2015:609). Organisations would partner
strategically with certain 3PLs in order to expand
into unfamiliar markets or to consolidate their
logistics operations into centralised distribution
hubs (Hilletoh & Hilmola, 2010:47).
TABLE 2: LOGISTICS PROCESSES AND ACTIVITIES CHARACTERISING THE BREADTH OF BASIC
SERVICES SUPPLIED BY 3PL SERVICE PROVIDERS
Logistics processes Activities
Transportation
Road rail air sea, intermodality management
Shipping
Forwarding
Package express carrier
Customs brokerage
Consolidation-deconsolidation
Perishable/hazardous goods management
Freight bill payment/audit
Order fullment and processing
Picking
Sorting
Dispatching
Post-production conguration
Installation of products at customer’s site
Warehousing storage
Receiving
Cross-docking
Consolidation/deconsolidation
Perishable/hazardous goods
Inventory management
Forecasting
Slotting/lay out design
Location analysis
Storage/retrieval management
Packaging
Design
Labelling
Assembly and packaging
Palletising
Reverse logistics
Pallets ows management
Recycling, reuse, remanufacturing disposal
management
Repair, testing and products servicing
Return shipment management
Source: Adapted from Bottani and Rizzi (2006:297).

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ese contemporary challenges in terms of
supply volatility and contractual uncertainty have
led to uncertainty in the relationship between
organisations and 3PLs (Yang & Zhao, 2016:215)
e of role strategic partnering between 3PLs and
organisation has expanded into a competitive
market, to support the organisational engine
for growth (Yang & Zhao, 2016:212). is has
changed the relationship between an organisation
and a 3PL from transactional to a strategic
partner (Crum & Daugherty, 2011:19). In order
to maximise eciencies in an organisation’s
supply chain activities, organisations tend to
have a closer relationship or alliance with 3PLs
(Rinehart, Eckert, Handeld, Page & Atkin,
2004:52).
e more advanced roles that 3PLs have in
terms of service oering and engagement with
organisations are discussed in the next section
and the notions of 4PLs, supply chain integrator
and orchestrator are reviewed.
Advanced Roles of 3Pls in Supply Chain
Management
e terms fourth party logistics, supply chain
integrators and supply chain orchestrators have
been used interchangeably in both academic
literature and in the supply chain industry. e
next four sections highlight some key similarities
and dierences between these terms in order
to better understand their meaning and their
subsequent role in supply chain management.
Fourth party logistics (4PLs)
3PL outsourcing can be dened as the practice of
outsourcing logistic activity that was previously
insourced (Gao, 2013:23). is diers from
outsourcing to a 4PLs which revolves around
organisations outsourcing the integration of
resources, capabilities and technologies to other
organisations to manage supply chain solutions
on their behalf, or rather the management and
integration of activities performed by multiple
3PLs (Büyüközkan, Feyzioğlu & Şakir Ersoy,
2009:113). It can also include a joint venture
between a group of organisations that ultimately
controls the supply chain with multiple supply
chain partners (Gattorna, 2016:16). (Saglietto,
2013:112) denes a 4PL as an independent rm
that coordinates the whole logistics function
of a client and integrates contracted or own
resources to manage complex value chains on
behalf of its client(s). Table 3 highlights some key
dierentiating characteristics between traditional
3PL and 4PL service providers. In reference to
Table 3, a typical 3PL is one that is asset heavy
with internal systems capability, whereas a 4PL
integrates the functions provided by a 3PL and
manages a whole supply chain. Comparing the
characteristics of the evolution from 3PLs to 4PLs
in Table 3 is key to understanding the evolving
role that they have played in organisations.
TABLE 3: KEY CHARACTERISTICS OF 3PL AND 4PL
SERVICE PROVIDERS
Types Key Characteristics
4PL
Supply chain visionary
Supply chain planner and optimiser
Deal shaper and maker
Supply chain re-engineers
Project management
Service, system and information
integrator
Continuous innovation
3PL
Integrated warehousing and
distribution
IT infrastructure provision and support
Localised data tracking
Asset owner and asset buyer
Warehouse Management Systems
Source: Adapted from (Gattorna, 2003:470)
Some 3PLs have grown into 4PL organisations
where the shi from 3PLs to 4PLs is a progressive
consequence of diversication of services and an
evolutionary process of services that 3PLs provide
(Kasperek, 2013:25).
Supply chain integrator
According to Pinna and Carrus (2012:105),
4PLs are dened as supply chain integrators
of logistic capability and technology. A supply
chain integrator is one that synthesises and
manages its own resources and technology with
complementary services of others that delivers
complete supply chain solutions (Pinna &
Carrus, 2012:107). Mukhopadhyay and Setaputra
(2006:718), mentioned that a 3PL can add value to

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an organisation by being an integrator of dierent
services on behalf of an organisation; one who
is neutral between logistics partners such as
managing a transport management process. e
role of 3PLs as orchestrators is discussed in more
detail in Section 2.2.3 and the gap in the denition
of this role is highlighted.
Supply chain orchestrator
e role of a 3PL to manage information ow and
product movement across multiple stages within
supply chains has evolved over the years to act as
an orchestrator within supply chains (Schmoltzi
& Wallenburg, 2012:53). Zacharia et al. (2011:44)
dene an orchestrator in a supply chain as one
that facilitates supply chain management best
practices and manages and coordinates supply
chain activities. Modern 3PLs have been evolving
into integrators and orchestrators of global supply
chains (Fung et al., 2009:238). In the literature
that was reviewed, the advanced role that 3PLs
have within organisations’ supply chains, when
dened as 4PL, orchestrator or integrator is found
to have a semantic overlap. e term supply chain
orchestrator will be used to refer to all three these
advanced roles in supply chain management.
Azad et al. (2011:29-43) conducted an extensive
review of the literature on the global roles that 3PLs
play in organisations and where, how, and why
3PL services are utilised by these organisations
in terms of their outsourcing arrangements. e
research did not focus on developing a model to
represent the value that a 3PLs adds as a supply
chain orchestrator. Büyüközkan et al. (2009:29)
created a decision-making framework that can
be used to select the appropriate supply chain
orchestrator that will add the most value to
an organisation. is framework has also not
dened the value that a 3PL adds as a supply
chain orchestrator. A clearer understanding of
3PL orchestration and the value it adds to its
customers is necessary in order to explore this
type of role that a 3PL plays within organisations’
supply chains. Section 2.2.4 discusses this type of
advanced role in more detail.
e role of the 3PL service provider as an
orchestrator
Zacharia et al. (2011:40-54) suggest that 3PLs
have progressed from not only having logistics
capabilities to becoming orchestrators of supply
chains that create and maintain a competitive
advantage. e model introduced by Zacharia
et al. (2011:40-54) depicted in gure 1 is used to
dene the orchestrating role of a 3PL within an
organisation’s supply chain. e focus industry of
the model was the transportation niche service
within a single, mature rm in the United States
of America (USA), and was used successfully to
FIGURE 1: A MODEL OF 3PL ORCHESTRATION
SOURCE: ADAPTED FROM ZACHARIA ET AL. 2011:46

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dene the value creation of an orchestrating 3PL
in a mature market.
e model is built on three socio-economic
theories as well as existing literature where four
interrelated elements are used to describe a 3PL
as an orchestrator within a supply chain. e
three socio-economic theories as pillars for the
model are:
Transaction cost economics
TCE within organisations relates to business
decisions in terms of ownership that minimise
overall transaction costs (Williamson, 1989:137).
In terms of outsourcing to a 3PL, an organisation’s
decision to do so will rest on reducing transaction
costs (Zacharia et al., 2011:41). TCE implies that
as long as there exists a cost benet to outsource
to 3PLs, it makes sense to do so, which in turn will
enable 3PL orchestration (Williamson, 2010:686).
Resource-based theory
RBT suggests that in order for an organisation to
survive and improve its operational performance,
it must have the right type of bundled resources,
eciently securing ow between them
(Rungtusanatham, Salvador, Forza & Choi,
2003:1086). On this premise, the outsourcing of
certain functions to a 3PL is supported (Zacharia
et al., 2011:42). RBT suggests that by making use
of the services of a 3PL, an organisation can gain
access to complementary resources to enhance its
competitive advantage (Jayaram & Tan, 2010:264;
Zacharia et al., 2011:42). is enhancement
of competitive advantage is gained mainly by
organisations that focus on boundary spanning
integration through outsourcing mechanisms
(Jayaram & Tan, 2010:265).
Network theory
NT proposes that through relationship building
and network coordination, an organisation can
manage its supply chain through an outsourced
arrangement as a single entity (Johansson,
2012:20; Snehota & Hakansson, 1995:6). In
terms of 3PLs, NT focuses on the formation
of relationships, organisational structures and
alliances, where organisations can take advantage
of network-wide relationships (Zacharia et al.,
2011:42). In 3PL collaborations, NT motivates
that competitive advantage can be gained by
the increased exibility and service that 3PLs
provide (Fulconis, Hiesse & Pache, 2011:63).
According to the model introduced by Zacharia
et al. (2011:40-54), the four interrelated elements
used to describe a 3PL as an orchestrator within a
supply chain are:
Standardisation
Standardisation refers to standardised processes
and data within a supply chain. is adds value
by simplifying the process of information across
supply chain partners to improve supply chain
visibility and is a prerequisite for the ecient
functioning of a 3PL (Zacharia et al., 2011:45).
Visibility
Visibility means information visibility across a
supply chain and the capability to have a view
beyond immediate supply chain tiers such as
customers or suppliers. A 3PL requires multi-
tiered supply chain visibility in order to be an
orchestrator (Zacharia et al., 2011:45)
Neutral arbitrator
When a 3PL acts as a neutral party between supply
chain partners, it is considered a neutral arbitrator.
is element of neutral arbitration adds value to
customers by being unbiased change agents and
playing a neutral role regarding information
sharing and industry benchmarking (Zacharia et
al., 2011:45).
Collaborator
3PLs create value to their customers by
promoting collaboration between supply chain
partners which can create better co-operations
between supply chain partners. 3PLs can foster
collaboration such as knowledge transfer and
shared facilities without posing any risk of
information sharing between supply chain
partners (Zacharia et al., 2011:46).
e model suggests that these four characteristics
are additive in nature, meaning that a 3PL cannot
be an orchestrator without all four characteristics.
A 3PL increases value creation within the supply
chain through a higher degree of standardisation
that improves visibility. Better visibility then
positively impacts a 3PL being a neutral arbitrator
leading to improved collaboration. e model
for 3PL orchestration is provided in Figure 1

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illustrating the four orchestrator characteristics
that dene a 3PL as an orchestrator in a supply
network that leads to value creation within the
network.
METHODOLOGY
Research design
In order to gain a better understanding of
the value-adding role of 3PLs in the UAE, a
qualitative design approach was used. e
participants’ opinions and perceptions were asked
on specic matters relating to contemporary 3PL
engagements within an emerging market. ese
opinions were interpreted in order to gain insight
into the existing theory of the role of 3PLs in an
emerging market (Merriam, 2009:14). Qualitative
research is best suited to describe social
interactions of a few people or groups of people
(Bryman & Bell, 2007:418). Generic qualitative
research design is characterised by collecting
qualitative data through interviews with people
and using thematic analysis to analyse the data
(Plano Clark & Creswell, 2014:289). e design
was chosen as the best approach for this research
study since individuals were to be interviewed,
their opinions collected as data around specic
research questions and analysed with the use of
thematic analysis to explore the value-adding role
of 3PLs in the UAE.
Sampling
e unit of analysis were the participating 3PL
organisations whose main business activity
is to provide logistics services. e study was
conducted within the 3PL industry in the UAE.
e participating organisations’ distribution
hubs are situated across dierent Emirates, with
the majority of the organisations’ head oces
located in Dubai. e market or industry is non-
specic and includes various sectors such as the
food and beverage, fast moving consumer goods,
construction, technology and pharmaceutical
industries.
e method of sampling that was used is criterion-
based sampling. Criterion-based sampling, a
form of purposive sampling, was used to select
the individual participants in that it depended
on certain criteria which were determined by
the purpose of the study (Daymon & Holloway,
2010:159). An aim of this type of purposive
sampling is to allow for some diversity within the
sample selection criteria in order to investigate
the impact of the characteristic concerned and
helped select specic organisations that t the
role in industry as a 3PL (Ritchie, Lewis, Nicholls
& Ormston, 2013:79). Organisations were chosen
that assume the responsibility of several logistics
functions of a client such as those summarised
in Table 2 in the UAE. e selected organisations
varied in size and footprint within the region.
Heterogeneous sampling involves selecting
individuals or groups of individuals that dier
from one another to gain maximum variation
in the samples (Daymon & Holloway, 2010:161).
In this way the participating organisations vary
in the scope of services oered, industry served
and size of the organisation. An advantage to this
approach is that it provides a broad spectrum
of participating organisations across dierent
industries that provide specic insights into their
potential role as an orchestrator within their
respective supply chains in an emerging market.
e disadvantages are that it is not industry
specic, nor size dependent, which may lead to
a distortion of the role the 3PLs play in emerging
markets. A total of ve organisations were chosen
to participate in the study. Table 4 highlight their
main service oerings.
e criteria used to select the individual
participants of the study was based on having
at least a managerial level position in the
organisation as well as knowledge of the service
oerings of that organisation, in order to have
homogeneity across the participants. At least
two participants per organisation were chosen to
add diversity to the sample criteria (Ritchie et al.,
2013:79). e participants and their representative
organisations, together with their participant IDs
as pseudonyms and job titles are listed in Table 5.
A gauge for ensuring data saturation is proposed
by Guest, Bunce and Johnson (2006:79) stating
that with good quality, homogeneous data, 12
participants should be sucient to achieve
saturation. Data saturation occurred aer 9
participants although 11 participants were
interviewed as is presented in the ndings. No
new information would thus be learnt from
involving more participants and collecting more

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data (Polit & Beck, 2012:521).
TABLE 4: A SUMMARY OF THE MAIN SERVICE
OFFERING OF THE FIVE PARTICIPATING
ORGANISATIONS
Organisation
ID Main service oerings
C01 Warehousing, distribution,
total supply chain management
C02
Warehousing, full scope of
SC solutions with integrated
IT solutions, land, sea and
air distribution, value added
services, material purchasing
C03
Warehousing, value added
services, freight forwarding,
distribution
C04
Warehousing, freight
forwarding, logistics
investment consulting,
strategic market entry
consulting, distribution
C05
Warehousing, integrated
managed SC solutions,
distribution, freight
forwarding, customised SC
solutions, transportation
management services
Source: Authors’ own compilation
Data collection
e data for this study was collected through semi-
structured interviews conducted with subject
matter experts and senior managers from 3PL
organisations within the UAE. Semi-structured
interviews do not follow specic guidelines or
parameters; for this reason, the generic approach
is best suited for this research (Kahlke, 2014:38).
is gave the necessary insights into their
social experiences to aid the research objective.
Interviews are verbal and oen in person
interactions with groups or individuals that act as
an organisational representative, in order to gain
more insight to their views and perceptions on
a particular matter (Rowley, 2012:260). Rowley
(2012:262) also states that interviews are good
ways to obtain an in-depth view on the matter in
question. Conducting these focused interviews
provided a thorough insight into the role of 3PLs
in the UAE.
Of the 11 interviews conducted, four were
telephonic and seven were face-to-face. All
interviews were audio recorded and transcribed
by a professional service provider supported by a
two-step verication process, to ensure the quality
the transcripts, which involved a second review
of the transcription by another transcriber. e
transcriptions were done within one week of each
interview. As indicated in Table 5, the interviews
ranged from 30 to 60 minutes, with an average
length of 46 minutes.
In preparation for the main interviews, a pilot test
was done with one participant who has had over
20 years’ experience in the eld of supply chain
management in order to test the discussion guide.
Minor changes were made to the discussion guide
to clarify certain statements aer the pre-test. e
line of questioning as per the discussion guide,
was asked in line with the interview questions
used by Zacharia et al. (2011:51). Each question
was followed by sub-questions to probe the
participant if necessary, in order to delve deeper
into the rst answer and the participant was
not interrupted whilst answering. is line of
questioning was continued until the highest level
of value was determined for each attribute or the
response from the participant was exhausted.
Data analysis
A thematic approach was followed to analyse the
interview data. is method of analysis involves
the systematic identication and organisation of
data to identify recurring themes in the data set
(Braun & Clarke, 2012:57).
TABLE 6: A STEPBYSTEP GUIDE TO THEMATIC
ANALYSIS TA
Six phase approach to TA
Phase 1: Familiarisation with the data
Phase 2: Coding the data
Phase 3: Searching for themes
Phase 4: Reviewing themes
Phase 5: Dening and naming themes
Phase 6: Producing the report
Source: Adapted from Braun, Clarke and Terry
(2014:100)

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is approach provided a good understanding of
recurring themes. Table 6 lists the six phases in
the thematic analysis approach used in the study.
e main terms used during qualitative data
analysis are listed and dened below:
• Transcribing: e process of creating a written
representation of a speech event so as to make
it accessible for research (Maree, 2007:104).
• Code: Unique identifying symbols and labels
that dene sections of text in a transcript
(Liamputtong, 2009:133).
• Coding: e process of text segmentation and
symbol labelling using descriptions to identify
themes (Liamputtong, 2009:133).
• In vivo codes: Actual data codes that are
not predetermined and allow researchers to
maintain the meanings of the participants’
views and words in their coding process
(Liamputtong, 2009:135).
• A priori codes: ese are predetermined codes
used in the data analysis and are developed
prior to data analysis (Liamputtong, 2009:135).
• emes / categories: Groups of codes that share
similarity of an idea or concept applicable to
the research (Creswell, 2014:238).
Trustworthiness
Trustworthiness was achieved through providing
a detailed description of the participants, the
research design as well as the analysis methods
used in order to maintain dependability of the
exploration process (Polit & Beck, 2012:584) and
to allow for external validity of the study ndings
(Ritchie et al., 2013:264). Triangulation of the
interview data and themes around orchestration
presented by Zacharia et al. (2011:47), removed
intrinsic bias, achieving conrmability (Polit &
Beck, 2008:198). Member checking was done
to conrm the accuracy of statements made
by participants by reviewing elements of the
transcript with the participant with a follow-up
phone call. is was done to achieve credibility of
the data (Polit & Beck, 2012:585).
FINDINGS
Two main themes were identied relating to
the purpose of this research. ese themes are
discussed in the following sections and tied in
TABLE 5: INTERVIEW PARTICIPANTS
Participant ID Job Title Gender
Industry
experience
in years
Duration of
interview
C01P01 Key Accounts Manager Male 35 01:11:05
C01P02 Chief Operations Ocer Male 25 00:36:04
C01P03 Head of Operational
Compliance Male 25 00:54:38
C02P01 General Manager: Contract
Logistics Male 35 01:01:02
C02P02 Managing Director Male 35 00:31:08
C03P01 Business Development and
Implementations Manager Female 5 00:30:04
C03P02 General Manager Male 21 01:00:05
C04P01 Country Manager Female 22 00:39:19
C04P02 Business Development
Manager Male 9 00:56:23
C05P01 Director of Business
Development Male 20 00:30:49
C05P02 Director of Integrated
Solutions Male 15 00:38:12
Source: Authors’ own compilation

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with the literature reviewed in terms of value
creation and supply chain orchestration. Table 7
outlines the main themes and sub-themes that
were identied, together with the participant
organisations that provided the insight into each
theme.
Operational logistics capability drives customer
value creation
e value that 3PLs add to their customers
was found to be embedded in their operational
capability of their service oerings. 3PLs manage
core services for many of their customers in order
to eciently manage cost in their supply chains
through the provision of exible, integrated
logistics solutions. Customers rely on 3PLs to
resolve logistics problems in their networks well,
building condence in their capability which
justies their decision to outsource. e following
sub-themes provides more insight into the views
of 3PLs in terms of the deemed value that they
add to their customers.
Condence in a reliable service provider
Organisations have grown in their reliance on
3PLs and depend greatly on their capability to
execute these services well (Su & Ke, 2013:2).
It was observed that participants’ view of the
condence that they build with their customers,
weighs heavily on them providing quality and
reliable services to their customers, as highlighted
by the following quotes:
“It’s important to them because at the end
they know that if they spend a little bit
extra in terms of a good quality service
provider, in the end, they’re going to
benet from it “ (C03P01, female, business
development and implementation manager)
“So I think for us in terms of what
stands out, in my belief, is that absolute
willingness to go the extra mile to make
sure that things get done.” (C01P03,
male, head of operational compliance)
From the data, it was evident that participants felt
that the value that they add as a 3PL is embedded
in their customers having condence in the
quality and reliability of the services rendered.
Whether this customer condence in a 3PL’s
capability relates to the length of service provision
is open for further research. is is especially true
TABLE 7: THEMES AND SUBTHEMES IDENTIFIED IN THE PARTICIPATING ORGANISATIONS
Main themes Sub emes C01 C02 C03 C04 C05
Operational
logistics
capability drives
customer value
creation
Condence in reliable service provider X X X X
Logistics problem resolution and risk
mitigation XXXX
Focus on core activity X X X X
Operational exibility improves
customer value X X
Ecient cost management X X X
Value creation
through
supply chain
orchestration
Impact of standardised processes on
value creation for customers X X X X
Customised processes creates value for
customers XXX
Supply chain visibility creates value for
customers XXXX X
Impact of standardisation on visibility
within a supply chain X X X X
3PLs creates value as a neutral arbitrator X X X X
Collaboration with customers creates
value XXXX X
Source: Authors’ own compilation

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as it relates to the perceived value that 3PLs have
within the market.
Logistics problem resolution and risk mitigation
When ousourcing logistics functions to a 3PL,
organisations rely on them to not only execute the
functions well, but also to use their experience of
the local market to resolve any logistical problems
that might arise from it, as is clear from the below
statements:
“And from the 3PL distribution and storage
[point of view], I think again, experience,
which I probably would say given my time
in the industry, is very important. I think the
innovation and problem-solving, solution
nding. I think, from an operations point
of view, experience is key in this matter.”
(C01P01, male, key accounts manager)
“… there are hurdles, but you can’t see
it. But through us, you can see those
hurdles that will come. We point [them]
out before the error starts.” (C04P02,
male, business development manager)
is form of risk mitigation can be an advantage
to organisations that outsource to 3PLs where
risks are shared within a logistics network
(Green, Turner, Roberts, Nagendra & Wininger,
2008:11). It is evident from the data that this role
of logistics network problem solving adds value
to their customers.
Focus on core activity
e theme of focussing on core activity was
highlighted unanimously across all participants in
this study. Customers outsource certain logistics
functions or whole networks to 3PLs in order to
focus on their core business competencies. is
was deemed a key value proposition from all
participants:
“You know, you’ve made a conscious decision
to use a third-party provider so that you don’t
have to worry about that business. You know,
it’s done. e reason you don’t do it yourself
is because you don’t want to be involved in
it. You want to focus all your time on selling
your products and developing your own
business.” (C02P02, male, managing director)
“So when I am doing my job right, I’m giving a
customer the peace of mind, the comfort level
in their business. And they also have enough
time to focus on new development and focus
on something better.” (C03P02, male, general
manager)
“ey can concentrate on their core skills
which maybe not [be] into logistics skills. So
again, it’s a case of going for the expertise, and
as I said, 3PL should be the experts in logistics,
so you’re buying in that skill, so you don’t have
to develop it in your own in-house operation.”
(C01P01, male, key accounts manager)
A criteria for a successful 3PL and customer
relationship rests on a customer focusing on
its core competency (Aguezzoul, 2014:72). e
participants stated that for most of their customers
they add the value of providing a one-stop-shop
and this has been a focus point in terms of their
relationship with their customers. is helps the
customer to focus on their core business, without
much involvement from the customer in the
outsourced service.
Operational exibility improves customer value
Participants have noted that providing operational
exibility to their customers, irrespective of
the service outsourced, adds a great deal of
value to their customers. In line with oering
complementary services to gain competitive
advantage, 3PLs should have a strategy that is
proactively exible in order to improve customer
satisfaction (Naim et al., 2006:298). As one
participant have noted in particular, providing
exibility in operations is a key contributor to
value creation:
“So they get service enhancement, so greater
[on the] spot availability, because it’s all about
having the right product in the right place at
the right time, and of course, at the right cost.
So we allow people to ex up and ex down
and we manage to peak, that’s what you pay us
for.” (C01P02, male, chief operations ocer)
Participants noted that together with providing
operational exibility, having the ability to
eectively manage operational cost adds value to
their customers.

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Ecient cost management
It was noted as a common thread across most
participants, that having the ability to eciently
manage logistics cost, creates value for their
customers in terms of the role that they play
within their customers’ supply chains. e
literature supports this notion that organisations
outsource to 3PLs to save costs within their
respective supply chains (Min & Joo, 2006:259;
Stank et al., 2005:29). e data highlighted two
key aspects of ecient cost management:
“Secondly, I think the benet [is] purely
from a cost saving perspective that it gives
them, hopefully, an opportunity to grow their
business because their cash ow’s improving.”
(C05P02, male, director of integrated solutions)
“is [logistics] is not their core business.
So they don’t know how to do cost-eective
[management] in this eld of logistics,
because there are so many loopholes
when consider[ing] logistics.” (C04P02,
male, business development manager)
In the study context, the two key value adding
roles that 3PLs have are that they oer economies
of scale and expertise to eciently manage and
operate logistics functions.
Value creation through supply chain
orchestration
e following four sub-themes were identied
through a priori codes (see Table 8) based on the
model for supply chain orchestration developed
by (Zacharia et al., 2011:40-54). ese four
themes are discussed below, highlighting the
relevance to supply chain orchestration and the
value that 3PLs add.
Impact of standardised and customised processes
on value creation for customers
It is essential for 3PLs to have standardised
processes in order to function eciently
(Zacharia et al., 2011:45). is was a recurring
theme amongst participants, who stated that
they will only be able to operate eciently with
standardised core processes. It was also noted that
standard core processes are deployed throughout
their operations in order to replicate processes,
adding value to their customers:
“First of all standardized procedures, it’s value-
added for the customer, because then we serve
in a clean line. ere’s no grey. It’s white or
either black, it’s that much simple.” (C04P02,
male, business development manager)
“Yeah. It certainly will add more value.
Having that quality process in place
means that it can replicated, it means
that all employees can be trained to do a
process in a consistent manner.” (C05P01,
male, director of business development)
Although most participants agreed that
standardised process does add value to their
customers, many also pointed out that there is a
lot of customisation required for each customer;
which leads to the following sub-theme.
Participants oered to explain that across their
current customer base, there exists much variety.
As a 3PL, they service many and varied customers,
all with unique requirements and challenges. As
a result, 10 out of the 11 participants noted that
they have to customise processes around specic
customers in order to add value. is is consistent
with Min et al. (2013:140), who suggests that roles
of 3PLs can develop to more customised services
or niche focus areas of 3PLs competencies.
Below are two quotes that best illustrate this
phenomenon:
“No, not standardized processes. Let me
rephrase that. You might have a core set of
process in SOP [standard operating procedure]
operation. But equally so, those core activities
will be rened or amended to t client specic.
at makes us unique, [it] is one of our USPs
[unique selling points). at is what the client
wants. It then becomes customizable to their
own, more customised processes.” (C02P01,
male, general manager: contract logistics)
“It is about the individual’s customer
oering. ey [customers] always start
with the standard set, and then they are
developed. Bespoke SOPs [standard operating
procedures] are developed for each client
because what suits client A will never suit
client B, even if they operate in exactly the
same segment. at’s why I concluded a

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bespoke SOP delivers more value.” C01P02
Further research is necessary around the value
that process standardisation adds to customers.
Zacharia et al. (2011:45) suggests that the
development of standardised processes add
value through ease of information sharing. It
is evident from the data that both standardised
and customised processes add value, but what
is unknown is how it impacts the value created
around the ease of information sharing.
Supply chain visibility creates value for customers
e ability of the 3PLs to have improved visibility
across their customers’ supply chains, creates
much value across the logistics network. is was
found mainly with participants who reported
long standing relationships or partnerships
with existing customers. Crum and Daugherty
(2011:19) notes that the existence of information
exchange between a 3PL and an organisation is a
key element of value in a partnership relationship.
Zacharia et al. (2011:45) refers to supply chain
visibility as being able to see along the supply
chain and indicate that it is necessary for supply
chain orchestration. One participant keenly noted
that having improved supply chain visibility is
necessary to add value to their customers:
“It is a process that we operate. at
means how we apply data and how we
gain knowledge from the data to provide
visibility. Without visibility, how the hell are
you going to run their business?” (C01P03,
male, head of operational compliance)
Another participant highlighted how improved
supply chain visibility would add value to their
customers:
“So the value would be in us understanding
and sitting with a customer and showing
them where their opportunities for cost saving
and value creation are. Absolutely no doubt.”
(C05P02, male, director of integrated solutions)
e participants who noted the value of supply
chain visibility did not mention how this
information visibility is gained, but indicated that
the degree to which they have better visibility
depends on the customer relationship.
Impact of standardisation on visibility within a
supply chain
Although participants’ views corroborate that
having supply chain visibility would add value
to their customers, the data is contrasted on how
process standardisation would impact supply
chain visibility. Zacharia et al. (2011:45) state
that without process standardisation, visibility
would not be possible. e data highlights that
sometimes standardisation would aid supply
chain visibility, but that this is not always the case.
Excerpts from two participants mention that
standardised process will improve supply chain
visibility:
“..standardisation of anything, in terms of
process of documentation, and quantity, data
is always going to result in better visibility.”
(C05P01, director of business development)
“... when you have the standardised procedures,
then that means you have the standardized
data store. at means you are able to reach
any kind of trends you would like to see. And
when you see the trend it’s easy to understand
everything, you know, outside the box, let’s
say, you can see everything immediately.”
(C04P01, male, general manager)
e comments below are in contrast to the
statements above, in that standardised processes
will not necessarily improve visibility.
“… whatever we do internally [standard or
customised], doesn’t pay o and increase
our visibility. at comes from the customer,
because we are the recipients of the product
of these customers and so whatever process
we have internally, won’t gain any visibility
upstream from the customer, because
whatever process I put in place, I still rely
upon information from the customer.”
(C01P01, male, key accounts manager)
“So, whether it’s a standard process or
it’s a completely unique process, the
visibility would be indierent to whether
the process is standard or not.” (C05P02,
male, director of integrated solutions)

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3PL create value as neutral arbitrators
A 3PL can add value to an organisation by being
an integrator of dierent services on behalf of an
organisation; one who is unbiased and neutral
between logistics partners (Mukhopadhyay &
Setaputra, 2006:718; Zacharia et al., 2011:45).
e participants frequently stated that their
customers value them having a neutral position
in the services that they provide. In many cases
the 3PL would act on behalf of their customers in
dealing with other supply chain entities such as
suppliers and legal governing bodies:
“Yeah, I think, as a 3PL, that’s what we must
demonstrate. And also in our case, as well,
because of where we are in thi s part of the world,
it is important to sometimes have someone
else to talk to, a regulatory body. When you
need to act for them, that’s what you do.
But that is why you’re a successful provider.”
(C01P02, male, chief operating ocer)
“Absolutely, yeah. It’s because for exactly
the point, we are neutral. So we’re operating
agnostically as to the third party that
we’re dealing with. We’re operating in
the customer’s best interests.” (C05P02,
male, director of integrated solutions)
It was also noted that some participants highlighted
the fact that their ability to be a neutral arbitrator
was enhanced by having improved visibility
across their customers’ supply chains:
“Yes. It does. Because we’re in the middle.
We’re, I guess, on the one hand we have all
the communication from the customer and
timeline. We have, you know, evidence of the
customer’s activities. Something that they
don’t have or the supplier or the other party
doesn’t have and vice versa. Because we’re the
ones with all the information, we do not have
communication between the customer and the
supplier, I think we are better informed and in
a better position.” (C03P01, female, business
development and implementation manager)
Since the 3PLs in this study oer many and varied
services to their customers, their role as a neutral
arbitrator would vary and so would the value that
they contribute in this regard.
Collaboration with customers creates value
Organisations tend to have closer, collaborative
relationships with 3PLs in order to maximise
eciencies and extract more value within the
supply chain (Rinehart et al., 2004:52). It was
prevalent from most participants that they as a
3PL add a great deal of value to their customers,
because they collaborate with them. e level of
collaboration varied across their customer base,
depending on the level of contractual maturity.
One participant maintained that they would not
add value as a 3PL if they did not try to collaborate
with their customers:
“We continually strive to have a partnership
arrangement rather than a client-supplier
arrangement. I think in the modern world
today, the client-supplier doesn’t really work,
in my opinion, it doesn’t really work that well.
I suppose even in a partnership there’s always
some kind of grey area or dividing line, but
the more both parties encourage and try to
work down into a single supply chain then
the better for everybody, I believe.” (C02P01,
male, general manager: contract logistics)
“So collaboration is critical. Otherwise, all
you’re doing is being a little bit like I think how
we [the industry] are in the Middle East right
now, which is, “You need 50 pallet positions?
No problem. at’s what the handling in
charges, that’s the handling out charges.
at’s what our storage rate is, let’s negotiate
a little bit, therefore, you’re in.” (C05P02,
male, director of integrated solutions)
Participants noted that they strive to collaborate
with their customers. In seeking opportunities
to improve operational eciencies and
optimising cost throughout within their scope
of responsibility, they endeavour to add value to
their customers.
CONCLUSION
Summary of ndings and theoretical
implications
is study explored the orchestrating role of 3PLs
within the UAE and how it relates to the value
creation model for 3PL orchestration presented
by Zacharia et al. (2011:40-54). e ndings
indicate that 3PLs in the UAE can be dened as

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orchestrators by creating value in terms of process
capability, supply chain visibility, operational
neutrality and customer collaboration. e factors
that inuence the orchestrating role of 3PLs are
the maturity of collaborative partnerships, the
ability of the 3PL to inuence the degree of supply
chain visibility and the scope of the outsourcing
arrangement (i.e., entire supply chains or partial
logistics outsourcing). Partnerships between
organisations and 3PLs that are more mature
share better collaborative relationships enabling
3PLs to have more inuence on supply chain
visibility. 3PLs can act more as orchestrators
within organisations’ supply chains for which they
have a greater scope of outsourcing agreements.
e study shows that 3PLs’ views of value creation
in the UAE are embedded in logistics capability.
3PLs manage core services for many of their
customers in order to eciently manage cost
in their supply chains through the provision of
exible, integrated logistics solutions. Customers
rely on 3PLs to resolve logistics problems in their
networks. is builds condence in the capability
of the 3PL which justies the organisational
decision to outsource. e factors that impact
value creation by 3PLs are logistics expertise of
the local market, the ability to provide exible
solutions and eciently manage supply chain
spend. e view of value creation and the role
of 3PLs in the UAE have expanded the body
of knowledge as to the evolving nature of 3PLs
in an emerging market. ey provide logistics
services to industry in line with previous research
ndings and play roles ranging from basic service
provision to advanced orchestration in supply
chains.
is study expands the model of 3PL
orchestration presented by Zacharia et al.
(2011:40-54) geographically, to an emerging
market. e ndings conrm that 3PLs create
value in line with some of the model elements
i.e. standardisation, visibility, neutral arbitration,
and collaboration, in particular supply chain
visibility and collaboration. e ndings are
inclusive pertaining to the value that is created
by standardised processes and being a neutral
arbitrator. It was found that that customised
process can add much value to customers and
the value created by being a neutral arbitrator
depends on the 3PL/customer relationship. It
also corroborates that that the model elements
of supply chain orchestration are interconnected
in dening the value creation role of 3PLs. In
contrast to the model for 3PLs orchestration
being additive in nature, the ndings show that it
is not necessarily the case. Improved standardised
processes do not necessarily improve supply chain
visibility, where customised processes can also
contribute positively to supply chain visibility.
It was also found that improved supply chain
visibility does not necessarily improve neutral
arbitration.
Managerial Implications
e role of 3PLs in the UAE is important in support
of the growing emerging logistics industry.
Organisations can benet from the research
ndings knowing that they can leverage from
3PLs’ operational capabilities to extract the most
value from them. Organisations with existing
3PL engagements can further advance their
level of collaborative maturity and information
sharing platforms to extract further value from
3PLs. 3PLs can benet from knowing that they
can create value by providing standardised or
customised processes to suit the needs of their
customers to orchestrate supply chain activities.
3PLs can strengthen their logistics capability in
the region, knowing that customers will value this
contribution. 3PLs should continue to build on
collaborative partnerships with their customers
to form strategic partnerships where applicable
which will create sustainable value. is implies
that 3PLs should collaborate closer with their
customers to gain better visibility of their supply
chains to establish more ecient and cost
eective operations that deliver exible supply
chain solutions in the UAE.
Limitations and Directions for Future Research
is study was limited to ve organisations and 11
participants, providing in-depth understanding of
the role that they play as 3PLs. ere is scope for
larger scale investigation as well as reviewing the
value of 3PLs from the customers’ point of view
in order to validate some of the ndings in terms
of customer value creation. It is evident from the
data that this role of logistics network problem
solving adds value to the customers of 3PLs. e
study identied a value adding theme of customer

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condence in 3PL’s capability. is view is limited
in providing insight into the impact that length
of service provision has on operational capability
and it is suggested for further investigation.
Further research is necessary around the value
that process standardisation add to customers.
e study is open to be replicated on a larger
scale to understand the value that is contributed
by both standardised and customised processes.
More in-depth research into contributing factors
that improve information visibility amongst
supply chain partners would be benecial. Since
in the context of this study, the 3PLs oer many
and varied services to their customers, their role
as a neutral arbitrator would vary and so would
the value that they contribute in this regard.
Further research is suggested to investigate cases
where the 3PL’s role as a neutral arbitrator is
better established to ascertain the nature of the
value that is created.
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