Too Late to Apologize? Performance Implications of Specialization and Variety in Last-Mile Delivery

Dominic Loske
Technical University of Darmstadt & DB Schenker

The presentation focuses on the performance implications of human task specialization and variety in last-mile delivery. Last-mile distribution is costly for logistics service providers and sustaining productivity in repetitive distribution tasks is essential to many organizations. Prior research points to different strategies to accomplish high service performance through the positive effects of experience: specialization to capture the benefits of repetition and variety to allow opportunities to learn. In this paper, we study the impact of team-level and driver-level experience on service performance during grocery retail distribution.

The empirical strategy includes real-world data of one depot located in Germany between January 2022 and November 2023: 223,615 customer service deliveries completed at 620 stores. The 330 drivers and 28 dispatchers at this specific depot form 3,828 unique teams.

The main results from the empirical analysis spawn various results: for the team level, we find that long- and short-term exposure to distribution channel variety positively affects service performance. Further, teams can mitigate the negative effect of service-level agreement violations when they are more specialized in distribution channels in the short term. In the case of high workloads, teams’ prior exposure to variety is beneficial. On the driver level, we find that customer-specific experience has a negative effect on service performance, while it is capable to reverse the negative effects of service-level agreement violations.

The results highlight the need for organizations to split specialization and variety into temporal and process dimensions rather than treating them as mutually exclusive. Overall, the study identifies new ways to improve service performance in last-mile distribution through a different and effective allocation of work.

Dominic Loske is a postdoctoral researcher at the Institute of Production and Supply Chain Management at the Technical University of Darmstadt and incoming Vice President as Head of Collection and Distribution Europe at DB Schenker. He is a member of the HumanTech Scientific Committee.

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