Global Competition and Heightened Customer Expectations - Dissertation Example

Also, the logistics industry is transforming speedily because of a lack of control in the transportation scenario due to TPLs working in the technologically advanced environment of the internet, e-commerce, and other electronic ways to offer logistics services (Marsh, 2007). TPL has been variously defined in the literature. A definition of TPL by Knemeyer & Murphy (2005, p. 710), citing Murphy and Poist (1998), points out that TPL involves “a relationship between a shipper and a third party which, when compared with basic services, has more customized offerings, encompasses a broader number of service functions and is characterized by a longer-term, more mutually beneficial relationship.

” It is a narrower definition of TPL focusing on the word “relationship”, highlighting the long term outlook of the TPL for completing various strategic functions. When it comes to managing risks, sufficient literature is available on risk management in general. However, research related to identifying risks is still at the nascent level when it comes to risk identification. Companies need to invest resources in attempting to identify the risks systematically; nevertheless, methods to follow systemic approaches are few and scarce.

A similar viewpoint is offered by Zsidsin et al., as cited by Rao & Goldsby (2009, p. 98), that “few studies exist that explore the key constructs necessary for assessing supply [chain] risk”. Therefore, the research gap between risk identification and risk mitigation needs to be worked out by selecting Saudi Arabia, a country in the Middle East. The example of Saudi Arabia can set the pace for a better understanding of TPL risks in an emerging field. Developed Western countries have already seen it happening and the complexity of the risk types and their management.

Further, selecting a country as a methodology would help find ways of improving the current situation of the TPL firms in Saudi Arabia. The addition of an electronic interface to the TPL industry has increased its liability risks, such as failure to securely provide reach and connectivity to its internet and extranet portals. These risk exposures are unforeseen and are not always binding by contracts. As customers of TPLs are equally technology-efficient, therefore, exhibit the least inclination to be partners in liability risks with TPLs, thus, increasing risk exposure of TPLs.

For instance, the websites of TPLs are very interactive for providing a good user experience to their customers for selecting freight carriers, checking about shipments or stock, and sending shipment instructions. Thus, various liability risks could be related to TPL functions over internet reach for completing shipping, billing, and claims documentation procedures, tariffs, posting of the carrier, stock, tracking, and management of transportation, load, administrative services, claims etc. among others (Marsh USA, 2007).

Although the TPL network has become highly globalised but considering the country-specific example, which is Saudi Arabia, one can see that the growth of TPL in the Middle East countries is relatively not as dynamic as in developed countries of Europe and the USA. When it comes to an approximation of TPL risks and risks mitigation in Saudi Arabia, one finds handicapped due to the lack of empirical data across the whole Arab region. However, research reveals that overall, TPL as a logistics segment is delivering well in Saudi Arabia.