Examining the Role of the Internet of Things and Coordination Human Resource Practices Towards Service Engagement and Firm Performance: The Moderating Effect of Digital Capability

Digital transformation in logistics requires sustainable service engagement; however, limited research has examined how technological and organizational factors jointly influence service engagement and firm performance. This study investigates the effects of the Internet of Things, information pervasiveness, shared decision-making, market orientation, and coordination-oriented human resource practices on service engagement, and examines the moderating role of digital capability in the relationship between service engagement and firm performance. Data were collected through a structured questionnaire from 312 logistics managers and analyzed using partial least squares structural equation modeling. The results indicate that IoT, information pervasiveness, market orientation, and coordination-oriented human resource practices positively influence service engagement, whereas shared decision-making has an insignificant effect. Digital capability strengthens the positive effect of service engagement on firm performance significantly. The model explains 52.6% of the variance in service engagement. This study contributes by integrating technological, organizational, and managerial factors into a unified framework, and demonstrates the contingent role of digital capability. Practically, the findings emphasize investments in digital capabilities, IoT, market-oriented strategies, and coordination-oriented human resource practices to enhance sustainable engagement, organizational resilience, and firm performance.