Adapting the retail business model to omnichannel strategy: A supply chain management perspective

Retail firms have developed new product and service offerings to meet the changing needs of omnichannel customers. While, prior research has documented these offerings in detail, little is yet known about how retail firms can best adapt different aspects of their organizations to the new omnichannel environment. We specifically focus on the intra-firm changes that affected the role of the firm's supply chain organization and its interactions with other business entities within the retail enterprise. This paper provides an in-depth understanding of the new business processes, organizational structures, governance mechanisms and customer interactions; collectively described as the retail business model (BM). Drawing on the tenets of BM theory, we present findings from a qualitative study of 15 leading U.S. omnichannel retailers to identify key elements of the new retail BM, develop a conceptual framework of the BM innovation process, and highlight the pivotal role of the supply chain organization in helping firms adapt and implement the omnichannel strategy. We conclude by developing research propositions to articulate the connections among different elements of the BM innovation process and how firms can institutionalize this process to respond to the everchanging retail business environment.