The Manifestation of Digital Transformation Concept in Indonesian Logistic Firms

The Manifestation Of Digital Transformation Concept In
Indonesian Logistic Firms
Muhammad Taufani1 and Anton Wachidin Widjaja2*

1
Faculty of Economics and Business, Universitas Indonesia, Depok, Indonesia
2
Faculty of Business, President University, Bekasi, Indonesia
Email Address:
[email protected], [email protected]*
*Corresponding Author
Submitted 08-03-2023 Reviewed 21-06-2023 Revised 21-06-2023 Accepted 21-06-2023 Published 03-10-2023
Abstract: Digital transformation has become an important challenge for logistic firms to achieve
competitive advantages. However, the digitization process's implications on a firm's performance still need
to be fully understood since transitioning from one method to another creates specific challenges. This study
examines the effects of digital transformation on logistic firm performance in Indonesia and looks at the
process of organizational learning and innovation as determinants of digital transformation. This study uses
a quantitative method with data from 165 respondents of logistic firms that have implemented digital
technology in their business operations. The PLS method is used as a data analysis method. Results showed
that digital transformation positively and significantly affects logistic firm performance. It was also found
that organizational innovation significantly affects digital transformation, ultimately affecting logistic firm
performance. Meanwhile, organizational learning capabilities showed no direct effects on digital
transformation.
Keywords: Resource Orchestration; Digital Entrepreneurship; Organizational Learning Capabilities;
Innovation Capabilities; Logistic Firm Performance.
Abstract: Transformasi digital menjadi tantangan penting untuk mencapai keunggulan bersaing bagi
perusahaan logistik. Namun, implikasi dari proses digitalisasi terhadap perusahaan masih belum jelas karena
transisi dari satu proses ke proses lainnya merupakan tantangan bagi semua pihak yang terlibat. Penelitian
ini mengkaji pengaruh transformasi digital terhadap kinerja perusahaan logistik di Indonesia dan juga
melihat proses pembelajaran organisasi dan inovasi sebagai penentu transformasi digital. Penelitian ini
dilakukan dengan menggunakan metode kuantitatif dengan menggunakan data yang dikumpulkan 165
responden perusahaan logistik yang sudah mengimplementasikan teknologi digital dalam operasi
perusahaannya. Metode PLS digunakan sebagai metode analisis data. Hasil penelitian ini menunjukkan
adanya pengaruh positif dan signifikan antara transformasi digital terhadap kinerja perusahaan logistik.
Selain itu juga didapatkan bahwa inovasi perusahaan mempunyai pengaruh yang signifikan terhadap
transformasi digital dan pada gilirannya berpengaruh terhadap kinerja perusahaan logistik, sementara
kapabilitas pembelajaran organisasional tidak mempunyai pengaruh langsung terhadap transformasi digital.
Kata Kunci: Orkestrasi Sumber Daya; Kewirausahaan Digital; Kemampuan Pembelajaran Organisasi;
Kemampuan Inovasi; Kinerja Perusahaan Logistik.
INTRODUCTION
Technological advances have created an enormous demand for organizational
capacities to deal with business dynamics. (Franco and Rodrigues, 2021) Stated that firms
need to adapt to market dynamics, be more proactive in exploiting opportunities, and make
improvisations to stay competitive in their business environments. Nowadays, one of the
most important challenges for every firm is integrating digital technology into their
business operations since the industrial sector, and firm operations will only be unaffected
Jurnal Manajemen/Volume 27, No. 03, October 2023: 428-448 428

DOI: http://dx.doi.org/10.24912/jm.v27i3.1383
by digital transformation. Digital transformation is a strategic response towards global
economic trends that drives firms to act fast and respond, so digital transformation has
become a strategic priority to increase competitive advantages(Wang et al., 2020). Digital
transformation creates business opportunities arising from the exploitation of various
digital technology developments, and transforming companies to be able to exploit them
is a challenge and priority for contemporary companies (Sousa et al., 2020)
The great impact of the presence of digital technology, in general, can be seen in the
increasingly competitive business environment, the overall transformation in the business
environment (industry), the dynamics of competition, distribution channels, and customer
relationships that encourage companies to adopt appropriate strategies related to digital
transformation. The changes brought about by technological advances in every level of
companies, including the exploitation of digital technology to improve process
performance and the exploitation of digital innovation, will potentially change the business
model (Franco et al., 2021). However, (Wang et al., 2020) explained that the
implementation of digital transformation is challenging to be elaborated in a dynamic
environment since the concept of digital transformation hints at a new direction for firms
or exhibits a blueprint for a business transformation as well as providing a guide for
management to integrate and utilize digital technology in implementing digital
transformation. Further, (Steiber et al., 2020) explained that the main challenge for firms
is not only about adding a digital touch to their current practices and products but also
about fully empowering the potential of digital technology transformation in their business
operations.
The changes brought about by digital transformation affect all kinds of industries,
including the logistics industry (Cichosz et al., 2020). Digital transformation in the
logistics industry sector includes both digital services and products as well as the handling
of logistic processes inside firms that are experiencing rapid changes (Büyüközkan and
Göçer, 2018). To benefit from digital activities, companies need to put forward new
approaches, including transformation with the application of renewable technologies
(Cichosz and Knemeyer, 2020). This study defines digital activities as a bunch of activities
connected by the utilization of digital technology in the supply chain process between
firms and their suppliers and customers. In other words, digital transformation in the
logistics sector is a new and smart process that has added value by utilizing a new approach
brought about by new technology to create competitive value and a wider network effect.
This activity is made possible by the existence of smart technology (platform), a
phenomenon present in a device that simplifies and further optimizes company operations.
(Nasiri et al., 2020).
Digital transformation allows firms to utilize new technological features in the form
of smart technology (platform), a phenomenon manifested in the form of gadgets or
devices to help make firms' activities easier to operate. The logistics industry has been
described as one in which many firms need a proper initiative or strategy to face the
digitization era and a clear program for adopting digital transformation processes. The
logistics industry in Indonesia is fragmented and requires more transparency and real-time
information. For example, 80 per cent of the trucks are owned by small and medium
industry players who have yet to adopt information technology within their companies
fully. It is also found that 90 per cent of orders and matching are done offline.
Furthermore, 80 per cent of deliveries are carried out manually, with slow
verification and a lack of initiatives to speed up the process (Sousa et al., 2020). Like other

industries, the logistics industry is described as one in which many companies need the
right initiatives and strategies to respond to digitalization and clear programs for adopting
digital transformation (Tijan et al., 2021). With the desire to implement effective digital
transformation, logistics companies are embracing technology to become leaner, faster and
more efficient. Using a combination of sensor technology, robotics, IoT (Internet of
Things), and Data analytics will completely revolutionize the operations of logistics
companies (Verhoef et al., 2021).
Digital transformation in the logistics industry is a challenge for all parties involved.
When firms evolve to adapt to the changes in modern society, the challenges become real.
The challenges are different for each firm and worker, where digital transformation must
be manageable but effective and efficient (Hernandez and Wagner, 2022). Moreover, many
researchers mentioned that new resources and capabilities are needed to effectively
compete in a digital era (Sousa et al., 2020). Another important aspect is that firms must
adopt entrepreneurial mindsets in digital transformation (Antonizzi and Smuts, 2020). all
companies in the logistics industry must pay attention and come together to prioritize
digital transformation initiatives, given the potential for much higher and sustainable value
to be created for the company (Tsou and Chen, 2021); (Hernandez and Wagner, 2022).
Previous studies have identified factors and conditions pertinent to the successful
adoption of digital transformation, such as compatibility between the technology utilized
by the firm and their management tools or resource orchestration (Chen and Tian, 2022),
entrepreneurial mindsets (Ladeira et al., 2019) and organizational learning capabilities
(Lara and Salas-Vallina, 2017), innovation capabilities (Tsou and Chen, 2021), among
others. Recently, there has been research on how logistic firms implemented new digital
technology (Cichosz et al., 2020).
Digital transformation has become a new norm and is a crucial component of
changing organizational business. Digital transformation has revolutionized the way firms
do their business. However, there needs to be literature that extensively examines the
holistic impacts of the main antecedents of digital transformation on firms, especially in
the case of logistical services providers. Recent studies highlighted that digital
transformation is a complex and challenging phenomenon (Eller et al., 2020) and still
needs to be fully understood in theory and practice (Sousa et al., 2020). (AlMulhim, 2021)
found that digital transformation has no direct significant effect, which contradicted some
other studies. One that draws much attention is the probability of another variable that
strengthens the impact of different variables on firm performance.
(Verhoef et al., 2021) It was explained that digital transformation allows companies
to develop capabilities in studying situations, continue to innovate in dynamic conditions,
and be more responsive in seizing opportunities in the industry. Digital transformation is
described as a process that requires a system that can achieve real-time transparency from
supplier to customer, connected operations, decentralization and autonomous management
(Cichosz et al., 2020). Several companies are actively adapting to the changes and
uncertainties of this environment, seizing business opportunities, changing business
behaviour, and initiating digital transformation because it can ensure that companies
remain competitive in a rapidly changing business environment (Chen and Tian, 2022).
Research shows that digital transformation can drive business innovation, enhance the
consumer experience (Zaheer et al., 2019), and upgrade (Wang et al., 2020); (Ferreira et
al., 2019); (Martínez et al., 2018). With the constant influx of technological innovations,

Digital Transformation has completely transformed businesses and can offer new
opportunities (Verhoef et al., 2021).
Digital transformation has become the norm and is considered a critical component
for changing a company's business. This has revolutionized the way companies do their
business. However, the literature has yet to extensively examine the holistic impact of the
main antecedents of digital transformation on companies, especially logistics service
providers. Recent studies have highlighted that digital transformation is a complex and
challenging phenomenon (Hennelly et al., 2019); (Eller et al., 2020); (Chen and Tian,
2022) and is still poorly understood, both in theory and practice (Sousa et al., 2020). The
study (AlMulhim, 2021) found that digital transformation does not directly have a
significant effect, in contrast to several other studies. One thing that is of concern is the
presence of other variables to be able to strengthen the influence of different variables on
company performance.
The academic literature that examines the impact of this transformation on logistics
companies in a sustainable manner still needs to be improved. In addition, empirical
studies carried out previously to investigate the relationship between the two concepts in
the context of developing economies and markets still need to be improved. The different
results in implementing digital transformation have generated significant interest among
researchers and practitioners (Eller et al., 2020); (Martínez et al., 2018). (Wang et al.,
2020) and (Tsou and Chen, 2021) focus on how different types of digital transformation
affect companies and the boundary conditions for these relationships (Martínez et al.,
2018). In particular, information technology (IT) competencies are widely recognized as
playing a critical role in determining the extent to which firms benefit from digital
transformation (Martínez et al., 2018); (Wang et al., 2020); (Tsou and Chen, 2021).
However, theoretical and empirical research on how digital transformation is affected still
needs to be developed. As a result, normative guidelines for predicting and recommending
specific informatics technology deployment strategies that may be effective are limited, as
evidenced by the various results of digital transformation implementations among
enterprises.
To fill this gap in our understanding of digital transformation, this study investigates
how firms can exploit their potential in digital transformation in a conducive way to
accomplish the benefits of digital transformation. This study uses resource orchestration
theory, an extension of a resource-based view theory, to develop the study model. It is an
empirical study to show the effects of digital transformation on firms based on several
determinant factors.
THEORETICAL REVIEW
(Nambisan et al., 2019) They have Characterized digital transformation as creation
and alterations brought about by market offers, business processes, or models born by
digital technology. Digital transformation forces firms to rethink the role and value of their
data in their business model (Mugge et al., 2020). Digital transformation is a multi-
interpretive phenomenon because it imposes different aspects and implications on each
firm in another way. (Vial, 2019) defined several frameworks and agreed that digital
transformation represents a significant change in the basic pattern of how firms create
values. In this way, many firms digitally transform themselves by inventing new ways to

create a new income stream by utilizing new advances in digital technology (Carnes et al.,
2017).
Resource Orchestration and Organizational Learning Capability. Based on
resource orchestration theory, firms can materialize their resource value if they can
effectively manage them. Firms will try hard to determine which resources need to be
targeted and how to exploit those resources to achieve business performance in the whole
organizational operations (Kristoffersen et al., 2021). Firms need to devise and manage
their resources to create new values and improve their systems during digital
transformation processes (Chen and Tian, 2022). Organizational learning facilitates
organizational upgrades over their superior assets and special capabilities to maintain or
improve their relatively superior performance (Thomas et al., 2017). Some studies have
further developed this view on resources by emphasizing that knowledge is a critical
strategic resource for firms (Martínez et al., 2018). The development of organizational
capability needs the integration of specific resources. Furthermore, their development and
implementation occasionally make them inherent and unique, thus becoming a source of
competitive advantages (Ricciardi et al., 2020). As such, the following hypothesis can be
formulated:
H1: Resource orchestration positively affects organizational learning capability.
Resource Orchestration and Organizational Innovation Capability. It is

important to understand how firms manage their resources to create innovation. Innovation
development needs specific capabilities resulting from resource integration obtained and
developed by firms (Carnes et al., 2017). Assets represent organizational resources in the
form of both physical and intellectual assets. At the same time, skills are usually pertinent
to human physics, information, or corporate capital, combined to create the desired results
(Verhoef et al., 2021). Specifically, a study is needed to help understand how firms pursue
growth through innovation in a different context (Carnes et al., 2017). Previous studies
primarily focused on the number of resources needed to develop innovation or the effect
of specific resources on innovation. However, precisely how the manager arranged those
resources is also important for innovation. Through creation, firms can determine and
control changes in their external environments and, most importantly, their role in building
long-term organizational competitive advantages (Celtekligiland Adiguzel, 2019).
Resource orchestration for innovation is managing all corporate resources to create a
combination of capabilities and delivering a new problem-solving ability into well-
managed and effective resource exploitation (Li and Jia, 2018). Based on this premise, a
hypothesis can be formulated as follows:
H2: Resource orchestration positively affects organizational innovation capability.
Digital Entrepreneurship and Organizational Learning Capability. (Alerasoul

et al., 2021) found in their study that organizational learning plays a comprehensively
mediating role in the relationship between learning orientation and entrepreneurial
orientation. (Oh et al., 2018) identified the organizational learning process as a key means
to achieve corporate strategic upgrades. Learning activities such as gaining or creating new
knowledge along with its distribution and integration into the company will make it a
significant strategic resource and allow firms to upgrade themselves to become more

competitive. (Alerasoul et al., 2021) mentioned that both learning orientation and
entrepreneurial orientation will affect organizational innovation. Digital technology makes
it possible for firms to build calculated products and services that have capacities to propel
changes that will lead to corporate growth (Zaheer et al., 2019). Another advantage of
digital technology is its flexibility as the driving force for rapid learning and
experimentation. Furthermore, a dynamic process inherent in digital technology will drive
faster iterations in non-linear pathways within entrepreneurial processes (Lara and Salas-
Vallina, 2017). Thus, the following hypothesis can be formulated:
H3: Digital entrepreneurship positively affects organizational learning capability.
Digital Entrepreneurship and Innovation Capability. (Alerasoul et al.,

2021)concluded that both market orientation and entrepreneurial orientation positively
affect innovation, in which their influences on organizations are mediated by learning
orientation. Further, (Lafuente et al., 2019) conceptualized entrepreneurship as a particular
economic function that drives organizational development by promoting innovations
propelled by entrepreneurship that create new combinations of inputs and outputs in which
innovations gradually become the central element in business competitiveness. Innovation
becomes the determinant factor for logistic firms where a resource in the form of vast
knowledge is needed to maintain a strategic position and to stay competitive in their
business environments, including the virtual environment (Ferreira et al., 2019). Digital
entrepreneurship creates new and challenging market opportunities for firms eager to
develop and introduce innovations based on their entrepreneurial ideas (Lafuente et al.,
2019). (Nadkarni and Prügl, 2020) explained that organizational entrepreneurship is
related to two phenomena: the emergence of new business opportunities in the form of
internal innovations or ventures and organizational transformation through the reinvention
of key ideas as their driving forces in the form of strategic upgrading based on digitization.
Based on this premise, a hypothesis can be formulated:
H4: Digital entrepreneurship positively affects innovation capability.
Organizational Learning Capability and Innovation Capability. Holistic

organizational learning is considered a prerequisite for innovation because it requires
assimilating and implementing new ideas (Martínez et al., 2018). This process starts with
the identification of needed knowledge and ends with the preservation of this knowledge
in the organizational repository. This process is crucial for all organizations, and more
importantly, it has a bigger impact on organizational competitive advantages (Magistretti
et al., 2021). The more innovative the products, services, or methods are, the more critical
capacity levels, skills, and newly relevant knowledge are needed (Halpern et al., 2021).
The extensive studies about organizational innovation received significant contributions
from studies about organizational learning in the last decade, which showed a positive
relationship between organizational learning capabilities and organizational innovation
(Gomes et al., 2020). The study by (Gomes et al., 2020) also showed a positive relationship
between organizational learning and innovation while explaining that cultural values
promote and support innovation. Furthermore, transforming ideas into new services will
depend on the skills to gain and employ new knowledge from their internal and external
environments. Thus, the following hypothesis can be formulated:

H5: Organizational learning capability positively affects innovation capability.
Organizational Learning Capability and Digital Transformation. (Sousa et al.,

2020) showed that firms will gain significant growth when supported by digital
transformation. Other studies also examined the role of organizational learning capabilities
and tried to explain how this might mediate the association between digital transformation
and corporate operations. Firms that cannot develop these capabilities will be left behind
in a highly dynamic digital economy environment. The successful response to achieve and
maintain competitive advantages will depend on the organizational capabilities to identify
and respond to challenges while at the same time reconfiguring their business elements in
a precise and continuous way (Vial, 2019). Thus, the following hypothesis can be
formulated:
H6: Organizational learning capability positively affects organizational digital

transformation.
Organizational Innovation Capability and Digital Transformation. (Steiber et

al., 2020) Explained that digital innovation is a process of assimilation between digital
technology and related digitization processes to create new ideas and developments. The
technological features are inherent parts that drive innovations. Theoretical and empirical
studies showed that technology plays a crucial role in developing new products and
processes and radically changes the fundamental structures of industry and redefined
competition rules. Studies have demonstrated how digital technology drives new forms of
innovation and entrepreneurial initiatives that transcend the traditional sectors and
industrial boundaries, embracing networks, ecosystems, and communities; integrating
digital and non-digital assets; and speeding up the starting, mapping, and evolution of new
businesses (Nambisan et al., 2019). Based on this premise, the following hypothesis can
be formulated:
H7: Organizational innovation capability positively affects organizational digital

transformation.
Digital Transformation and Logistic Firms Performance. (Eller., 2020)

elaborated digital transformation benefits for firms, such as better access to improved skills
and abilities, more access points to markets, more comprehensive access to the financing
sector, better communication and collaboration, and more access to the implementation of
technology and application programs. To fully exploit the potential of digital
transformation and improve operational performance, firms must continually expand their
experiences in adapting to new digital concepts, keep investing in the digital domain, and
improve their skills and capabilities in digital management. Through continuous digital
technology implementations, firms can promote automation and sophistication of internal
operations, reduce costs significantly, improve operational efficiency and management
quality, and transform business processes and business model innovations, ultimately
optimizing customer experiences (Wang et al., 2020). Thus, the following hypothesis can
be formulated:
H8: Digital Transformation positively affects logistic firm performance.

A research model can be developed based on the above research hypotheses, as seen in
Figure 1.
Figure 1. Research Model

Source: Primary data processed
METHODS
In this study, a population of Indonesian logistic firms were sampled. Logistic firms
that were included in this study were firms that have implemented digital technology. The
respondents in this study were top management or managers of logistic firms that have
adopted digital technology regardless of the extent of their digital technology applications.
The sampling methods used in this study were purposive.
Next, the instruments that were used to measure constructs of resource orchestration
theory were instruments that were developed by (Cichosz et al., 2020), (Wang et al., 2020),
and (Kristoffersen et al., 2021) which consist of 5 items. To measure digital
entrepreneurship constructs, instruments that were developed by (Franco et al., 2021),
(Hennelly et al., 2019), and (Beliaeva et al., 2019), which consist of 10 items, were used.
Instruments developed by (Sousa et al., 2020) and (Tortorella et al., 2020) comprised ten
things to measure organizational learning capability constructs. Next, innovation
capability constructs were measured using instruments developed by (Tsou and Chen,
2021) consisting of 8 items. To measure digital transformation constructs, instruments
developed by (Hennelly et al., 2019) and (Tsou and Chen, 2021), which consist of 8 items,
were used. Constructs for logistic firm performance were measured using instruments that
were developed by (Akdoğan and Durak, 2016) (Irfani et al., 2021); (Li and Jia, 2018),
which consisted of 14 items.
The PLS-SEM method was used to test the conceptual model of this study using
SmartPLS 3.2 software. Next, model evaluation in SmartPLS was performed in two steps:
(1) evaluation of the measurement model (outer model) and (2) evaluation of the structural
model (inner model) (Ghozali, 2021). The Outer Model was evaluated by examining (1)
Convergent Validity, (2) Discriminant Validity, (3) Composite Reliability, and (4)

Cronbach's Alpha. The Outer model was used to evaluate the relationship between a
construct and its indicators, consisting of two elements: convergent validity and
discriminant validity. The structural model in PLS was assessed using R2 for dependent
constructs, path coefficient values or t-value of each path to examine the significance of
inter-constructs within the structural model (Hair, 2017). This study's second evaluation
was performed to examine the inner model.
RESULTS
The following is 165 respondents' demographic data, as shown in Table 1.
Table 1. Respondents’ Characteristics Data
Respondents' age
21 to 30 y.o. 35 21.210 per cent
More than 30 to 40 y.o. 49 29.690 per cent
More than 40 to 50 y.o. 57 34.550 per cent
More than 50 y.o. 19 11.520 per cent
165
Tenure
1 to 5 years 39 23.660 per cent
More than 5 to 10 years 31 18.780 per cent
More than 10 to 15 years 39 23.630 per cent
More than 15 years 56 33.930 per cent
165
Job Title
Top Management 43 26.060 per cent
Middle Management 88 53.330 per cent
Junior Management 34 20.600 per cent
165
Business Fields
Loading-Unloading 46 27.870 per cent
Cargo 5 3.030 per cent
Distribution 7 4.240 per cent
Customs/Export-Import 1 0.610 per cent
Port Management 32 19.390 per cent
Maritime Shipping 25 15.150 per cent
Transportation 18 10.910 per cent
Ekspedisi 20 12.120 per cent
Warehousing 10 6.060 per cent
165

Table 2 shows the final evaluation results for convergent validity with its loading
factor; by eliminating some indicators that have values less than 0.500 and subsequently
re-estimated, it was revealed that all indicators/items have loading factors larger than 0.500
and are thus considered valid. On the other hand, convergent validity can also be measured
by estimating each indicator on AVE. The indicator to estimate AVE is that when the AVE
value is larger than 0.500, the item on that variable has enough convergent validity (Hair,
2017). Next, based on the above table, estimation results for convergent validity with AVE
showed that each variable's AVE value is larger than 0.500. Thus, this study's data has met
the convergent validity criteria.
Table 2. Results of Validity and Reliability Tests
Composite
Variable No Item Factor Loading AVE
Reliability
RO1 0.939
RO2 0.826
Resource Orchestration RO3 0.819 0.951 0.795
RO4 0.914
RO5 0.953
DE1 0.81
DE2 0.916
DE3 0.787
DE4 0.805
Digital DE5 0.778
0.956 0.688
Entrepreneurship DE6 0.939
DE7 0.777
DE8 0.891
DE9 0.786
DE10 0.784
OLC1 0.851
OLC2 0.938
OLC3 0.726
OLC4 0.891
Organizational OLC5 0.778
0.965 0.733
Learning Capability OLC6 0.792
OLC7 0.872
OLC8 0.943
OLC9 0.813
OLC10 0.929
INNO1 0.914
INNO2 0.853
INNO3 0.804
INNO4 0.957
Innovation Capability 0.959
INNO5 0.768
INNO6 0.871
0.748
INNO7 0.795
INNO8 0.938
DT1 0.948
DT2 0.752
DT3 0.773
Digital Transformation DT4 0.885 0.961 0.758
DT5 0.877
DT6 0.842
DT7 0.942

DT8 0.924
FP1 0.846
FP2 0.920
FP3 0.775
FP4 0.844
FP5 0.731
FP6 0.839
Logistic Firm FP7 0.703
0.962 0.647
Performance FP8 0.779
FP9 0.853
FP10 0.674
FP11 0.767
FP12 0.683
FP13 0.913
FP14 0.876
Primary data processed
Figure 2 shows the results of PLS-SEM analysis depicting test results for research
hypotheses.
Figure 2. PLS Algorithm Results
Based on the results in the R-Square table, the R2 value for organizational learning
capabilities was 0.967, which can be considered a good value and indicated a contribution
of 96.700 per cent effects from both resource orchestration and digital entrepreneurship
variables. Next, the R-Square value for innovation capabilities was 0.878, which can be
categorized as a good value, which indicated a contribution of 87.800 per cent effects from

resource orchestration, digital entrepreneurship, and organizational learning capabilities
variables. R-Square value for digital transformation was 0.716, which was categorized as
a good value, which indicated a contribution of 71.600 per cent effects from both
organizational learning capabilities and innovation capabilities variables. Lastly, the R-
Square value for firm performance was 0.653, categorized as a good value, indicating a
contribution of 65.300 per cent effects from the digital transformation variable. Lastly,
based on this estimation results, a Q-square value was estimated at 0.999 or 99.996 per
cent; thus, it can be concluded that the diversity of research data in this study was as large
as 99.960 per cent and the rest of it at 0.040 per cent, was explained by other variables
outside of this study.
The following is the evaluation results for all research hypotheses in this study:
Table 3. Results of T-Statistic Tests for Research Hypotheses
Original Sample Standard

Hypothesis Path Sample Mean Deviation t-value Result
(O) (M) (STDEV)
Resource orchestration
H1 → organizational 0.471 0.470 0.085 5.574 Supported
learning capabilities
Resource orchestration Not
H2 0.170 0.181 0.198 0.858
→ innovation capability Supported
Digital entrepreneurship
H3 → organizational 0.527 0.528 0.083 6.369 Supported
learning capabilities
Digital entrepreneurship Not
H4 0.131 0.151 0.133 0.983
→ innovation capability Supported
Organizational learning
H5 capabilities → 0.684 0.655 0.282 2.425 Supported
Innovation capability
Organizational learning
Not
H6 capabilities → digital 0.264 0.231 0.271 0.976
Supported
transformation
Innovation capability →
H7 0.670 0.704 0.274 2.447 Supported
digital transformation
Digital transformation
H8 → Logistic firm 0.876 0.879 0.022 39.857 Supported
performances
Source: The result from Smart PLS Data Processed from Questionnaire
Based on the test results of these direct effect hypotheses with path coefficients, the
next step is to test the hypotheses by comparing t-statistic results to t-table (1.975) at a
significance level of 5 per cent (0.050). The results showed that Resource orchestration
did not have a significant and positive effect on organizational innovation, Digital
entrepreneurship did not have a significant and positive impact on corporate innovation,
and Organizational learning capabilities did not have a significant and positive effect on
digital transformation.

DISCUSSION
As shown in Figure 3, the proposed research model was examined to accomplish
the research objectives and to provide answers to the research questions (straight lines
indicate the results can be accepted at a significant level). Overall, this study's results
confirmed a significant correlation between digital transformation and logistic firm
performance. It was found that the effect of digital transformation on logistic firm
performance was manifested through a long process. The interesting point found in this
study was that logistic firms' capabilities to accomplish digital transformation were
determined by their innovation capabilities. Organizational learning capability did not
directly determine digital transformation but was mediated by the formation of
organizational innovation capabilities. Resource orchestration and digital entrepreneurship
could only develop innovation capabilities but they develop organizational learning
capabilities.
Figure 3. Research Model after the Hypotheses-testing

Logistic firms are urged to optimize their resources; to accomplish that, digital
entrepreneurship mindsets will be needed in its implementation process. Those resources
and perspectives are managed through an organizational learning process to optimize the
corporate transformation. This is in line with (Martínez et al., 2018), who concluded that
digital transformation is the main component for improving organizational performance in
dynamic and technologically laden environments. Digital transformation alters the nature
of the required dynamic capabilities since, in essence, organizational capabilities in digital
transformation can be gained by exploiting skills, abilities, knowledge and experiences

that are related to the management of digital technology in combination with corporate
innovation, as suggested by (Halpern et al., 2021).
Study results showed that the correlation between resource orchestration and
innovation capabilities could be more consistent with (Urbinati et al., 2021), who stated
that the intensive use of digital technology for resource management in innovation process
development will lead to digital transformation. Resource orchestration must first achieve
organizational learning as the basis for forming innovation capabilities. Qualified
resources can be gained through resource mobilization (RO5) by corporate vision and
mission. Resource mobilization is consistent with INNO4 indicators, where firms exploit
their resources to improve organizational learning and creativity to support digital
transformation.
Logistic firms must be ready for digital implementation that will bring many
benefits, such as cost efficiency, improved asset productivity, and innovation, enabling
firms to survive in a highly dynamic environment and achieve better performance. Results
from this study indicated that resource orchestration did not significantly affect the
innovation capabilities of logistic firms. The organizational learning process was also
found to be independent of logistic firms' digital transformation directly. This study
discovered several weak indicators for resource orchestration and innovation capability
variables. This might explain that firms need to improve their digital technology
implementations to optimize their resources and achieve superior organizational
capabilities. This is also indicated in INNO5, which explains that firms can only
accomplish a renewable approach with the support of qualified resources. RO2 indicators
also explained that firms could not minimize their suboptimal resources, which might
hinder their implementation of the renewable approach.
Organizations need to focus on managerial commitment, system perspective,
openness and experimentation, and the transfer and integration of knowledge to achieve
business innovation. It is implied that regardless of firm size, management must focus on
successfully implementing digital entrepreneurship in conjunction with organizational
learning capabilities and innovation processes to maintain organizational performance
improvements by creating more digitized organizations. (Halpern et al., 2021) They have
explained that the significant and positive effects of organizational innovation capabilities
on the digital transformation process showed that it is important for firms to improve their
digital proficiency to develop new digital products to cater for new customer demands.
This also suggests that logistic firms must improve their digital entrepreneurship
orientation by strengthening their resource orchestration to enhance competency and gain
new knowledge. Organizational learning can become a crucial vehicle for logistic firm
management. A structured learning strategy allows firms to fully exploit new opportunities
to transfer helpful expertise and transform it into a successful innovation and achieve a
fully implemented digital transformation (Martínez et al., 2018).
Building and perfecting digital capabilities and taking them to the whole level of
organization will be the key for firms to transform their digital strategies into daily
organizational activities. The corporate learning process can be achieved through training
programs for the whole level of the organization. Training can build mindsets about the
importance of having digital entrepreneurship ideas and the capability to think creatively.
The learning process can be achieved through training since corporate objectives can
model organizational resources to have the ability to implement new approaches
periodically, both inside the industry and towards their customers. Therefore, managers

must focus on continuously improving their organizational structures and enforcing
learning processes at the whole level of the organization to facilitate innovation efforts
with the basic foundation of digital transformation.
Furthermore, organizational learning can significantly affect digital transformation
when supported by the development of corporate innovation. (Martínez et al., 2018)
Explained that innovation has become more complex in the last few decades and requires
the assimilation of external ideas, emphasizing the importance for firms to be open to
embrace and acquire new external knowledge to be developed through the innovation
process. For this purpose, it will be beneficial to collaborate with external agents to gain
new knowledge that can be implemented into products, processes, or organizational
systems (Martíneze et al., 2018). In this study, as indicated in OLC8 and INNO4
constructs, external agents (suppliers, vendors, and customers) were the main components
that can bridge the combination of organizational learning and the improvements of
organizational innovation capabilities. (Alerasoul et al., 2021) added that corporate
innovation was confirmed to have a significant result that was mediated by learning
orientation and inter-function coordination with the support of corporate resources,
wherein, as indicated by both resource orchestration and digital entrepreneurship variables,
it was found that according to respondents, they were always looking for creative ideas to
create innovation by mobilizing resources accurately (RO5) and that firms were also
actively looking for inputs from their customers (DE6) through the role of a senior figure
in their organizations. Study results also explained that organizational learning can bridge
the creation of qualified resources and the formation of digital mindsets through a senior
figure or an external source of information (INNO8 and INNO2) to achieve an effective
innovation level in their organizations.
Firms need to empower innovative culture and implement organizational learning
processes that support acquiring and exploiting new knowledge to achieve digital
transformation improvements as the corporate objectives. (Konopik et al., 2022) They
added that firms could create a difference in performance by examining and adjusting their
business models to the constantly changing (digital) world. This finding is also consistent
with (Khin and Ho, 2019), who stated that technological orientation benefits
technologically based innovations. Considering the importance of organizational
capability for the success of digital transformation, firms must devote their resources to
maximize their internal capabilities by honing skills and abilities through training,
outsourcing, creating alliances or collaborating with more capable partners. In essence,
organizational qualifications in the digital transformation process can be built through
skills, abilities, knowledge and experiences related to managing digital technology in
conjunction with corporate innovation (Ferreira et al., 2019) (Halpern et al., 2021).
(Cichosz et al., 2020) (Tijan et al., 2021) explained that digital transformation in
logistics companies can be driven by several factors including collaboration with other
parties (suppliers, vendors and customers), companies are encouraged to be more creative
in meeting customer needs which can be realized significantly through the implementation
of digital technology and how to adopt it. Technology in all business lines of logistics
companies. In this study, it was also found that innovation significantly supports digital
transformation; according to research by (Khin and Ho, 2019) and (Halpern et al., 2021),
the significant positive effect of innovation capabilities on the digital transformation
process indicates that it is important for companies to improve their digital skills in the
development of new digital products to meet new customer needs. On the other hand,

organizational learning was insignificant to digital transformation. However, what can be
found is how the figure of an agent or leader is part of the corporate learning process,
where, according to the majority of respondents who have more than 15 years of
experience in their company, the role of an agent is crucial where existing resources can
be directed according to the vision and mission company so that it has a good capacity in
processing creative ideas for the company.
Looking more broadly at the respondents in this study, it was found that the majority
of respondents aged 41 to 50 years with more than 15 years of service explained that
resources could be mobilized by the company's vision and mission where respondents felt
this was very well embedded in the mindset of members the company is by the results of
the RO5 and DE6 indicator analysis tests in which the company is responsive to consumer
input. The company's response is by the application implemented according to the
respondent's tenure. However, with the majority of respondents aged 41 to 55, it was found
that technology adoption in resource mobilization and consumer input needed to be
improved. Furthermore, it was found that most respondents were positioned as senior
company managers, indicating the implementation of learning within the company
according to the company's vision and mission structure (OLC8). With the majority of the
age of the respondents and the position of the respondents in the company, innovation in
the company is driven by quite a lot of creative ways (INNO4) and tries to stay in line with
the learning being done, but is constrained in a renewable approach (INNO5) where this
reflected in the mindset and resources that have not been fully integrated with technology.
Furthermore, companies must rely on an innovative culture and implement
enterprise learning processes that support the acquisition and use of this knowledge so that
the company's goals in enhancing digital transformation can be achieved and that
companies can create performance differences by studying and adapting their existing
business models to the changing (digital) world. This finding is also in line with the results
of (Khin and Ho, 2019), which state that technology orientation is beneficial for
technology-based innovation. Given the importance of capabilities in dealing with digital
transformation, companies should devote their resources to maximizing their inherent
capabilities by engaging in training, outsourcing, or having alliances or collaborations with
stronger partners. Company capabilities in digital transformation can be built with skills,
talents, knowledge and experience related to managing digital technology combined with
company innovation (Ferreira et al., 2019); (Halpern et al., 2021).
CONCLUSIONS
The logistics industry is relatively complex, and this study found the importance of
the learning process as a basic guideline for logistics companies to implement digital
transformation. This study also showed that organizational learning capability does not
affect digital transformation, where a positive influence on digital transformation must go
through an innovation process first. Then, this study found that selecting related resources
and applying digital entrepreneurship thinking cannot directly influence company
innovation but must go through a learning process first.
The results of this study have added an essential foundation for the study of digital
transformation in the logistics industry. The results showed a positive correlation between
digital transformation and logistic firm performance. Innovation capabilities significantly
affect digital transformation. On the other hand, organizational learning capabilities did

not considerably affect digital transformation. Further, it was found that organizational
learning capability significantly affected innovation capability. Innovation capability has
a direct effect on digital transformation in logistics firms. In contrast, organizational
learning capability did not directly affect digital transformation but was mediated by the
creation of innovation capability.
Logistics companies need to focus on digital implementation readiness, which will
encourage cost efficiency, asset productivity, and innovation so that companies can survive
in very dynamic situations and create good performance. Building and refining digital and
other capabilities and bringing them to scale across the enterprise will be key as companies
translate strategy into day-to-day enterprise activities. This implementation can be created
by appointing a qualified agent or leader so that existing resources can have a proven
mindset and are capable. The important role of a leader is one of the things that needs to
be considered because the leader's vision reflects the vision of the entire team in the
company.
Next, the results of this study showed that resource orchestration had a significant
effect on organizational learning capability but did not have a substantial effect on
innovation capability. Further, digital entrepreneurship also had a considerable impact on
corporate learning capability but did not substantially affect innovation capability.
Resource orchestration and digital entrepreneurship indirectly significantly affected
innovation capability through organizational learning capability, which suggested that
resources and digital entrepreneurship mindsets need a corporate learning process in a
series of actions to build organizational innovation capabilities.
Logistic firms must promote digital transformation through organizational
innovation and digital technology implementation by incorporating a flexible, dynamic,
and innovative basic foundation. The head of logistics firms must understand that the
elements of digital technology are rapidly changing and that these changes are highly
correlated to the aspects of market characteristics and their customers. This study also
clarified managerial understanding of the requirements of organizational innovation for
firm performance, especially the different aspects of organizational innovation concepts
that are commonly applied.
There are also some limitations of this study, which could be opportunities for further
research. First, this research is limited to more than just a few sub-sectors of the logistics
industry, such as port management, loading and unloading, transportation and shipping.
Therefore, further research is needed with a more diverse industrial sample. This research
was implemented in collaboration with companies from specific logistics sectors, which
opens up further opportunities for future studies with the broader logistics sector. This
study obtained data that was not evenly distributed on several demographic characteristics.
This can lead to bias due to the tendency of unequal data in certain groups. Hence, the
researchers conducted a differential test to prove differences between demographic
characteristics groups, which shows limitations in describing logistics companies broadly.
However, researchers have used channels that allow them to reach respondents with more
diverse characteristics. Furthermore, this research focuses on implementing digital
technology within companies through managerial roles, which are reflected in the figures
of decision-makers in logistics companies, so there is no inclusion of control variables in
the category of company size (profit, number of employees, etc.).

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The Manifestation Of Digital Transformation Concept In

Indonesian Logistic Firms

Muhammad Taufani1 and Anton Wachidin Widjaja2*

Jurnal Manajemen/Volume 27, No. 03, October 2023: 428-448 428

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H1: Resource orchestration positively affects organizational learning capability.

Resource Orchestration and Organizational Innovation Capability. It is

H2: Resource orchestration positively affects organizational innovation capability.

Digital Entrepreneurship and Organizational Learning Capability. (Alerasoul

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H3: Digital entrepreneurship positively affects organizational learning capability.

Digital Entrepreneurship and Innovation Capability. (Alerasoul et al.,

H4: Digital entrepreneurship positively affects innovation capability.

Organizational Learning Capability and Innovation Capability. Holistic

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Organizational Learning Capability and Digital Transformation. (Sousa et al.,

H6: Organizational learning capability positively affects organizational digital

Organizational Innovation Capability and Digital Transformation. (Steiber et

H7: Organizational innovation capability positively affects organizational digital

Digital Transformation and Logistic Firms Performance. (Eller., 2020)

H8: Digital Transformation positively affects logistic firm performance.

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Figure 1. Research Model

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Table 1. Respondents’ Characteristics Data

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Table 2. Results of Validity and Reliability Tests

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Figure 2. PLS Algorithm Results

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Table 3. Results of T-Statistic Tests for Research Hypotheses

Original Sample Standard

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Figure 3. Research Model after the Hypotheses-testing

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