Working Paper
In the last two decades, last-mile delivery (LMD) firms have seen immense growth fueled by e-commerce’s success, leading to faster and cheaper deliveries. This growth has brought forth new challenges including increased competition and heightened customer expectations. Operating on thin margins, LMD firms strive for successful first-time deliveries to avoid the financial and reputational cost from reattempts. Delivery Agents (DAs) are integral to LMD efficiency, influencing customer experience, delivery success, and productivity. However, most LMD performance enhancement research focuses on process, technology and incentives, presupposing that gig workers will conform to procedures and monitoring tools will function flawlessly.Nevertheless, in practice, DAs deviate from expected behaviors i.e., indulge in misconduct, negatively affecting delivery efficiency often resulting in returned parcels. One of the major misconducts are fake remarked deliveries, wherein DAs intentionally do not deliver the parcels and provide a fake reason for it. For instance, even without reaching a delivery address, a DA remarks ‘customer unavailable’ and record a delivery failure.
In this study, the authors collaborated with a leading Indian LMD firm and, using instrumental variable regression, find that such misconduct leads to a spillover productivity loss. This effect reduces the next day's successful deliveries by 1.60% and first-time-right deliveries by 1.86%. We discuss misconduct's correlation with several factors such as task complexity, offering actionable managerial insights.
The authors offer novel insights into how undesireable worker behavior can be influenced by opportunistic circumstances. Our study is among the first to quantify misconduct's impact on LMD productivity, highlighting its impact onoperational costs.
