The following section discusses the findings of the study in light of current research and literature on urban freight transport, and explains the implications for theory, business, and policy.
6.1 Discussion
The preceding analysis revealed that the issues and challenges related to urban freight transport in Copenhagen parallel those in the US as well as those mentioned in the literature. The main issues include noise, air pollution, congestion, and traffic safety. The case interviews show that there are at least two perspectives on urban freight transport improvement initiatives. On the one hand, the authorities are attempting to improve the environmental and sustainable aspects of the city of Copenhagen through initiatives such as collaborative networks and regulations on vehicles and city access. On the other hand, both authorities and logistics service providers are interested in having the trucks and vehicles used for freight deliveries enter and leave the city as fast as possible, and thus look for measures to improve delivery efficiency. This fits into previous research on modeling efforts to increase efficiency, policy measures for
72 sustainability, and local authority and stakeholder involvement to better align the many objectives and interests.
The interview findings and subsequent comparison with the theory developed by Rose et al. (2016), show that logistics service providers operating in urban areas in parts of the US and in Copenhagen experience many similar institutional pressures from actors in their environment. This is particularly true for the physical and spatial constraints that they encounter – a finding that supports Dablanc (2007) in her claim that urban goods movements are largely independent of local urban structures, since the characteristics of cities make them “complex, costly and constrained space” (p. 281) regardless of where they are. However, although the pressures that urban logistics service providers experience may be similar, the approaches that the firms use to manage these differ.
Peng et al. (2009) argue that firm behavior and strategic choices are based on three factors: the forces in the industry relative to those of the firm, firm-specific resources and capabilities, and formal and informal rules and influences in the institutional environment of the firm. This means that the same strategy applied in two different contexts, for instance two different countries, may not lead to the same results, because of the institutional differences. Therefore, institutional differences make firms pursue different strategies in different contexts despite operating in the same industry or field. Such institutional differences may be uncovered in various ways. As previously mentioned, Oliver (1991) proposes that the strategic approaches of firms vary due to variations in five institutional antecedents – cause, constituents, content, control, and context, and their two predictive dimensions. Differences in these factors between the institutional environments in the US and Denmark may be an explanation why the strategic approaches of logistics service providers in the two countries differ. Control, for instance, is related to the means by which institutional pressures are being exerted, and whether they are exerted through legal coercion or voluntary diffusion of norms (Oliver, 1991). The US study puts emphasis on the forces of urban membership and how the operations of logistics service providers are impacted by conflicts of interest between the company and the local community, and local governments are briefly mentioned as having an impact on firm resources.
In comparison, the interviewees in this current study on Copenhagen put emphasis on the regulatory requirements from authorities that impact their operations as well as expectations from customers to fulfil their demand for services in an efficient way. Firms in the US manage their legitimacy and membership of the community through activities and initiatives outside their scope of business, such as hiring extra security outside their warehouse, which benefits the inhabitants in the area as well. Firms in Copenhagen manage
73 their stakeholders through collaboration or influencing actors in their environment in order to create change, both in terms of regulations but also in terms of citizens’ perception of freight.
This collaborative approach is not unusual in Europe, where many freight partnerships and networks are created to find better solutions to common problems and share this knowledge through best practice. A great deal of these projects are partly or fully funded by the European Union. Moreover, one of the interviewees mentioned the concept of the triple helix, which is based on the idea that innovation and economic development in a knowledge-based society will benefit from a triadic relationship between universities, industry, and government (Stanford University - Triple Helix Research Group, 2016). The freight network in Copenhagen is largely inspired by other networks using this concept. There is no mentioning of such collaborations on a strategic urban planning level in the US study, it rather touches upon sharing of scarce resources between competitors. This does not mean that such initiatives do not exist in the US, but it may be an explanation for the differing strategic approaches. A larger number of cases in Copenhagen would also contribute to understanding whether the pressures and strategies are only true for some companies, or if the results are applicable to other urban logistics service providers as well.
The final model in the analysis section of this study shows that urban logistics service providers in Copenhagen actively manage their stakeholders in order to create value, either to increase efficiency or maintain their legitimacy in society. This way of looking at stakeholder management differs from how it is traditionally viewed in the literature on urban freight transport, focusing on how local authorities need to take initiative to firstly identify relevant stakeholders and secondly involve them in their planning processes (Ballantyne et al., 2013). The study’s findings highlight that the actors in the urban environment of Copenhagen both experience institutional pressures from other organizations and exert institutional pressures back towards these organizations. The many actors and their differing interests is what makes urban freight transport so complex. Taking a holistic stakeholder approach and mapping out the various stakeholders and actors involved including their objectives, barriers, and drivers towards a certain project, could contribute to increased visibility of the main issues and differences, and thus create a better foundation for where efforts should be put to make a change. As seen in the model, the strategies employed by urban logistics service providers in response to certain institutional pressures will lead to new pressures, and as such, affect the whole system of urban freight transport. Linking this to the fact that adapting to institutional pressures does not necessarily lead to greater efficiencies for the organizations (DiMaggio & Powell, 1983;
Kauppi, 2013), underlines the importance of understanding the impact of these pressures and strategies on the entire system of urban freight transport as well as the extended supply chain. Doing this enables the
74 actors involved to minimize the chance of optimizing one part of the system to the inconvenience of another part. The figure below illustrates how the many flows of institutional pressures in urban freight.
Figure 8. Interaction of institutional pressures. Source: Author
One example could be that local authorities experience pressures from other authorities to implement certain regulations or requirements to reach environmental objectives, often based on best practice. In abiding to these pressures, the authorities exert coercive pressures on logistics service providers, who may then choose to manage this either through collaboration or influence. Their choice will impact the types of pressures that will be exerted on them by the authorities at a later stage. Increased transparency and clarity around these interactions and links between institutional pressures may lead to more holistic solutions benefiting the whole sector.
6.2 Implications for theory
Institutional theory claims that organizations become increasingly homogeneous because of adapting to pressures from their environment. The current study not only contributes to the research on urban freight transport, but also contributes to the research of extending institutional theory into other disciplines and investigating a particular phenomenon in a specific context. An additional contribution is creating more awareness of the strategic approaches that urban logistics service providers employ in managing the various
75 institutional pressures they are exposed to, as well as the need for more research on this. Seeing that the findings of the study differ somewhat from the middle-range theory on environmental pressures on urban logistics service providers and their management approaches by Rose et al. (2016), it encourages further research in different contexts in order to determine whether an elaboration or adjustment of the theory is needed. The creation of a framework of institutional pressures in different contexts and the range of strategic approaches available may provide urban logistics service providers with input for their own strategies in urban areas.
The study only goes slightly into how characteristics of the institutional environment and the pressures exerted trigger certain strategic approaches, and what those approaches are meant to achieve. However, in doing this, it links models and propositions from organizational theory, strategic management, and logistics, and encourages the continuation of such cross-disciplinary work in trying to better understand urban freight transport.
6.3 Implications for business
In addition to the theoretical implications mentioned above, the findings of this study also inform logistics service providers about the institutional pressures that are commonly experienced in their context as well as the strategies that are used to manage these. Understanding the resulting pressures or outcomes of pursuing a certain strategy will enable firms to select the approaches that correspond to their objectives for urban freight, and thus contribute to creating an overarching strategy for their urban freight transport operations.
However, as mentioned above, the complexity of the topic requires all actors involved to show greater interest in the inter-connectedness of different strategic behaviors and actions in order to not sub-optimize the whole system. Bigger efforts in mapping out which stakeholders the firms interact with, including their objectives and approaches, is therefore encouraged, potentially as a collaborative effort in the freight network or similar initiatives.
6.4 Implications for policy
Urban space is shared by many actors with differing objectives and interests, which makes planning for urban freight transport a complex task. This study is a step towards enabling policy makers to better understand the pressures that urban logistics service providers are exposed to and how they manage these.
For instance, several of the interviewees in the individual cases in this study mention that there are
76 challenges with the current regulations on urban freight in the city. A lack of enforcement of regulations around time windows and environmental standards for vehicles makes it difficult for those who do adhere to the rules to compete with those who do not. Additionally, the congestion caused from all companies being on the road at the same time combined with lack of parking and loading spots, make drivers spend more time in the city. This is contrary to the goals of both the authorities and the urban logistics service providers.
Thus, as for the business implications, mapping out who the stakeholders of urban freight transport are together with their objectives, barriers, and drivers, may create transparency around the issues that are common to the sector and potentially highlight the areas to focus on.