Trust, Commitment, Satisfaction, Strategy Alignment, Logistics Outsourcing Relationships Quality and Logistics Performance: A Case of Selected Manufacturing and Distribution Firms in Uganda

Abstract

This study sought to examine elements of trust, commitment, satisfactionand strategy alignment as antecedents of logistics outsourcingrelationship quality (LORQ), and assessed their influence on firmlogistics performance. The study adopted a cross-sectional andexploratory study designs. Descriptive, analytical, quantitative andqualitative designs were also used. Findings showed that there is astrong positive relationship between trust, commitment, satisfaction andstrategy alignment, and logistics outsourcing relationship quality; andbetween logistics outsourcing relationship quality and logisticsperformance. Findings also show that trust, commitment, satisfactionand strategy alignment when combined explain up to 70% variance inLORQ with trust being the most important predictor explaining 42%variance in LORQ. Meanwhile results obtained from a forward step-wise regression show that LORQ is a significant predictor and explainsup to 50.9 percent variance in logistics performance. A full mediationeffect is confirmed on LORQ and trust and strategy alignment, while apartial mediation exists between LORQ and commitment and customersatisfaction. The studied independent variables can predict up to 67.7percent (and with the inclusion of LORQ) they predict up to 68.1percent) variance in logistics performance implying that only 31.9percent variance in logistics performance may be explained by otherfactors. In our analysis we observe that logistics outsourcingrelationships largely involve two-way information exchange,coordination and trust. Elements of trust, commitment, and satisfactionmay be viewed as both antecedents and effects of relationship quality.The logistics outsourcing strategy should thus be evaluated from aduo-perspective. This study explore logistics outsourcing as a strategyfor enhancing logistics performance in manufacturing and distributionfirms within the context of a developing country. The study providesan empirical investigation on the relationship between outsourcingrelationship quality and logistics performance, an aspect that has notbeen largely explored before.