The Moderating Role of Institutional Quality in the Relationship Between Logistics Capability and Firm Performance

Abstract

The connection between logistics capability and firm performance has become a subject of increasing scholarly interest, but little is known about the contextual circumstances under which this relationship is formed. The research study examines the moderating effect of institutional quality in the nexus of logistics capability-firm performance. The study will utilise the Resource-Based View (RBV) and Institutional Theory as a basis for a qualitative research design, including 310 respondents who are selected from manufacturing and service companies. Qualitative data collected using in-depth interviews and structured open-ended questionnaires are analysed using thematic analysis. Results show that institutional quality, which includes regulatory effectiveness, rule of law, and governance structure, plays a significant role in moderating the relationship between logistics capability and the performance of firms. Companies in a high institutional quality environment have higher performance benefits from their logistics capabilities. The research contributes to the literature by combining the institutional views with the research on logistics-performance and presents practical policy and managerial implications to companies in developing economies.