The Effects of Implementing Sustainability and Digitalization Management on Small Shipping Companies’ Competitive

Sustainability and digitalization have been important issues for the world shipping industry in recent years. Shipping companies need to address these issues to be able to thrive for the long run, including the small shipping companies in Indonesia. However, there has not been any empirical study on the effects of implementing sustainability and digitalization management on the competitive advantage of small shipping companies. This study aims to analyze the effects of sustainability and digitalization management, termed Sustainable Shipping Management (SSM) and Shipping Digitalization Management (SDM) respectively, on Indonesian small shipping companies’ competitive advantage (SCA). Since Dynamic Capabilities (DC) and Service Capabilities (SC) are considered to be essential capabilities in creating sustainable competitive advantage based on Resource-Based View (RBV) theory, this study focuses on the roles of DC and SC in mediating the SSM and SDM effects on SCA. It utilized survey method on top management of Indonesian small shipping companies. It used sample from the population, selected using non-probability sampling technique and purposive sampling method. There were 185 respondents from 170 companies qualified to participate in this study. The result shows that SSM and SDM positively affects SCA, either directly or indirectly via the mediations of DC and/or SC. SSM and SDM are both found to contain the elements of DC and SC, therefore their implementations are important for the companies to create and maintain competitive advantage. It provides insights for the owners or the management of Indonesian small shipping companies on how to allocate their limited resources in SSM and SDM to build and strengthen their competitive advantages. It also calls for policies and incentives developed and created by the government and related agencies to assist the small shipping companies to implement sustainable management and conduct digital transformation