Navigating AI Implementation in Healthcare Retail: A Case Study on Leadership, Workforce Adaptation, and Digital Transformation

Widespread integration of artificial intelligence into healthcare retail offers significant opportunities but introduces complex challenges when leadership strategies and workforce capabilities are not correctly aligned. This study investigates the critical factors influencing the success or failure of digital transformation initiatives, focusing on a case study of MedSupplyCo, a mid-sized healthcare retailer operating in Maryland, Virginia, and West Virginia. MedSupplyCo was chosen because its size and operational challenges represent broader industry trends during accelerated digital investment from 2024 to 2030. A structured literature review comprising 39 peer-reviewed articles, complemented by theoretical and empirical research, provided an informational foundation for analysis. The Leader-Member Exchange Theory, Kotter’s Change Management Model, and the Technology Organization Environment Framework were applied to examine how leadership dynamics, workforce training, and governance practices impacted transformation outcomes. Operation breakdowns and financial decline stemmed from misaligned leadership, untrained staff, and implementation of a weak governance structure. The study shows that organizational success in digital transformation depends on integrating leadership methods with digital targets as well as prepared and ready employees. The study’s scientific novelty lies in integrating leadership theory with digital transformation frameworks in the underexplored context of small and mid-sized healthcare retailers. The findings offer actionable insights for business leaders to structure AI adoption strategies, for policymakers to guide ethical and sustainable technology use, and for researchers seeking to expand studies on organizational resilience in AI-driven markets. These results establish strategic foundations for organizations that want to maintain a competitive advantage via integrated leadership with workforce development and technology readiness systems.