Exploring the role of digital innovation in advancing supply chain sustainability through inventory management in the Malaysian retail sector

Abstract

Digital innovation is progressively transforming the way organizations handle supply chain operations, especially with the use of technologies like artificial intelligence, cloud computing, blockchain, and the Internet of Things (IoT). Specifically, the objectives of this study are to identify the factors shaping digital innovation adoption in inventory management and analyse how inventory visibility conditions the sustainability value of such innovation. A qualitative basic inquiry design was employed, using semi-structured interviews with twelve managers directly involved in inventory-related decision-making, including retail, warehouse, finance, and transportation managers. Data were analysed thematically through manual coding. The results indicate that the adoption of digital innovation for some organizations depends on the economic performance of their business. The research also reveals that digital innovation can improve supply chain sustainability through waste reduction, cost efficiency, and supply stability, but only when supported by organizational readiness and transparent information sharing. This result reinforces the holistic view that digital transformation is a socio-organizational process and is not subject to technical considerations alone. Inventory management is not merely an internal technical activity but also a practical mechanism, namely the ability to implement digital innovation, which demonstrates effectiveness in supporting sustainable supply chain outcomes.