Enhancing online-to-offline delivery efficiency facilitated by Industry 4.0: a personnel configuration perspective
| DOI | https://doi.org/10.1108/IMDS-05-2022-0268 |
| Published date | 20 September 2022 |
| Date | 20 September 2022 |
| Pages | 1198-1219 |
| Subject Matter | Information & knowledge management,Information systems,Data management systems,Knowledge management,Knowledge sharing,Management science & operations,Supply chain management,Supply chain information systems,Logistics,Quality management/systems |
| Author | Hongyan Dai,Yan Wen,Weihua Zhou,Tingting Tong,Xun Xu |
Enhancing online-to-offline
delivery efficiency facilitated by
Industry 4.0: a personnel
configuration perspective
Hongyan Dai and Yan Wen
Business School, Central University of Finance and Economics, Beijing, China
Weihua Zhou
School of Management, Zhejiang University, Hangzhou, China
Tingting Tong
Institute of Supply Chain Analytics and International Business College,
Dongbei University of Finance and Economics, Dalian, China, and
Xun Xu
Department of Information Systems and Operations Management,
College of Business Administration and Public Policy,
California State University, Dominguez Hills, Carson, California, USA
Abstract
Purpose –The overuse and scarcity of resources emphasize the importance of the circular economy. The
technology facilitated by Industry 4.0 stimulates the implementation of the circular economy that aims to
reduce resource use and enhance operational efficiency. This study focuses on enhancing delivery efficiency in
an online-to-offline (O2O) context from an Industry 4.0 technology-facilitated personal configuration
perspective, that is, comparing in-house and crowdsourced delivery efficiency in China’s O2O on-demand
food delivery context.
Design/methodology/approach –The authors collect 128,152 orders from 38 restaurants of an online
restaurant chain in China. The authors adopt multiple regression analysis to examine the delivery efficiency
gap between in-house and crowdsourced deliverymen and the determinants of this efficiency gap.
Findings –The findings of this study reveal that crowdsourced deliverymen exhibit higher delivery
efficiency, in terms of a shorter delivery time, than in-house deliverymen. In addition, the authors find that
platforms providing monetary incentives or implementing late delivery penalties enlarge this efficiency gap.
Furthermore, the authors show that external factors, such as working on weekends and bad weather
conditions, contribute to the narrowing of this performance efficiency.
Practical implications –The study’s findings suggest that platforms should use advanced technologies
facilitated by Industry 4.0 to optimize their personnel configuration to enhance their delivery efficiency and
reduce carbon emissions. The effective approaches include using financial incentives and improvingworking
schedules.
Originality/value –The authors’findings contribute to the online fulfillment literature by focusing on
delivery efficiency in the O2O context from the Industry 4.0 technology-facilitated personnel configuration
perspective. The authors examine how internal and external factors moderate the performance efficiency
between these two types of deliverymen.
Keywords Delivery efficiency, On-demand, Online-to-offline, Technology management
Paper type Research paper
IMDS
123,4
1198
This study is supported by the National Natural Science Foundation of China (Grant Nos. 72172169,
71903024, 72192823, 91646125, 72232002, and 72271172), the Key R&D Program of Zhejiang Province
(No. 2021C01104) and the Program for Innovation Research at the Central University of Finance and
Economics.
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0263-5577.htm
Received 1 May 2022
Revised 29 July 2022
Accepted 23 August 2022
Industrial Management & Data
Systems
Vol. 123 No. 4, 2023
pp. 1198-1219
© Emerald Publishing Limited
0263-5577
DOI 10.1108/IMDS-05-2022-0268
1. Introduction
Businesses today are using various technologies facilitated by Industry 4.0 to optimize their
resource utilization, improve operational efficiency, and achieve a higher level of
sustainability in all of the environmental, social and economic dimensions (Nikolaou et al.,
2021). This aligns with the essence of the circular economy, which refers to an industrial
economy that is regenerative- or restorative-oriented and reflected by its design, process,
intention and behavior (Geissdoerfer et al., 2017).
Owing to the rapid development of technologies based on Industry 4.0, the online-to-offline
(O2O) service has emerged and witnessed a fast growth over the recent years (Pei et al., 2021).
For example, in China, since 2017, the request for O2O on-demand delivery has increased
substantially along with the expansion of delivery terminals and increased volume of orders.
The order amount has reached $2.71 billion in 2019, and the number of on-demand delivery
users in China has been reported to be $75 million in 2020 (iiMedia Research, 2021). The
growth rate of on-demand food sales is expected to increase at an annual rate of 7% from 2019
to 2024 globally (Technavio, 2022). Online platforms typically include grocery service
platforms (e.g. Jingdong to Home and Hema, a representative of the Ali retailing group in
China) and food service platforms (e.g. DoorDash, Grubhub, Postmates and Uber Eats in the
US and Meituan and Elema in China).
One of the unique features of the O2O mode is its on-demand feature. This new business
model is changing the nature of routing and scheduling problems in the traditional delivery
system (Yildiz and Savelsbergh, 2019). The order lead time, namely the time interval between
the orders’placement and reception by the consumer, is guaranteed within a short period.
Therefore, O2O on-demand operations need Industry 4.0-facilitated technologies such as
mobile Internet to locate the order and the deliverymen in a real time, big data analytics to
analyze the data about demand, supply and fulfil lment environment, and artificial
intelligence to optimize the fulfillment algorithms to achieve smart operations and
management.
In the O2O mode, consumers place orders online and receive their ordered services and
products offline. This service mode brings convenience to both sellers and buyers (Dai et al.,
2021). In detail, the operational processes of on-demand markets may be described as follows.
First, consumers place orders on O2O platforms. Then, their orders are transmitted to
restaurants and shops. After that, restaurants start preparing the orders (the shops start
picking up the orders) upon confirmation. The platforms then dispatch the orders to specific
deliverymen. Finally, the assigned deliverymen collect the orders from the restaurants or
shops and deliver them to the consumers. Figure 1 visually depicts the operational flow of the
O2O mode.
From the O2O operational process, we can establish that it has a high impact on the
circular economy. This is because the entire O2O process not only includes the production
stage but also the fulfillment stage. Delivery is an important performance measurement of
O2O on-demand platforms, and it faces last-mile-related challenges (Guo et al., 2019). The
environmentally friendly delivery process can reduce waste and carbon footprints and
improve electromobility that facilitates the realization of the circular economy (Galati et al.,
2020;Li et al., 2020b;Niu et al., 2021).
The time advantage, reflected by the O2O’s on-demand feature, has become a critical
factor for consumers to generate their O2O purchase intention and behavior (Dai and Liu,
2020). In the O2O mode, one crucial element of the order lead time is the order delivery time,
namely the time interval between the departure of deliverymen from the restaurants or shops
and their arrival at their destinations (Xu et al., 2021). The optimal configuration of the
deliverymen is important to help them optimize their delivery route and mode, which reduces
carbon emission and enhances delivery efficiency (Dai et al., 2020;Li et al., 2020a). However,
the large growth and variation of O2O orders over time complicates the configuration of the
Enhancing
O2O delivery
efficiency
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