Economic growth of a country highly depends on the development of its service sector. The logistic or transportation industry in Malaysia has significantly contributed towards the national economy and has also provided the employment opportunities. The industry has undergone a radical change due to the rapid evolution of information technology. The need to have efficient services is undeniable because of the increase in e-commerce applications which demands for service companies to innovate. Nevertheless, unlike the manufacturing sector, the innovation models in the service sector are still under developed. Hence, this requires further investigation in understanding the service innovation, especially in the area of transportation industry. This study aims to develop a model that links four main variables which are relevant to the industry, namely the
determinants of service innovation, service innovation, information technology capability, and service responsiveness. A survey has been conducted on postal, courier, and freight forwarding companies. Data from respondents were analyzed by using PLSSEM. The result of the study provides a meaningful insight on the service innovation and ultimately, contributes towards enhancing the responsiveness of the postal services, courier, and freight forwarding companies. The study limits its scope only on selected transportation service. Hence, it is recommended for the future studies to investigate further on a broader scope of transportation service or even on other industries
