Though many companies are placing or implanting employees within supply chain partners' firms for the purposes of improving organizational and supply chain performance, research to date has not sufficiently addressed the outcomes of organizational implantation. Our research is specifically focused on the impact that logistics service provider (LSP) implantation has on logistics service innovation for the customer. In a dyadic study pairing 81 LSP implants with their customers, we assess the direct linkage of interorganizational task interdependence, as well as the mediating effects of relational social capital and knowledge exchange on the logistics service innovation of the customer. Empirical analysis revealed significantly more logistics innovation for those customers hosting implants. The logistics innovation is attributable to fully mediated relational social capital and knowledge exchange capabilities in the implantation relationship. Managerial directions related to our findings, as well as possibilities for future implantation-related research, are discussed.

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