Demand-side capabilities for internal omnichannel supply chain integration: a dynamic capabilities perspective

Driven by rapid digitalization, the retail sector has shifted from multichannel to omnichannel models that integrate physical and digital channels and touchpoints. Omnichannel shopping has elevated the strategic importance of supply chain capabilities to deliver seamless cross-channel experiences. This study investigates how demand-side dynamic capabilities (DSDCs) facilitate internal omnichannel supply chain integration (SCI). Guided by the dynamic capabilities view (DCV), the research addresses three objectives: identifying what DSDCs enable internal SCI, explaining how these DSDCs facilitate internal SCI, and classifying the DSDCs within the sensing, seizing and reconfiguring clusters of higher-order dynamic capabilities (HODCs). Using an abductive, multi-method qualitative approach, the analysis draws on 17 semi-structured interviews with senior decision-makers and 40 integrated annual reports from leading South African omnichannel retailers. Through reflexive thematic analysis, eight key DSDCs were identified, focusing on formulating meaningful customer experiences and facilitating omnichannel supply chain operations. The study contributes by extending the DCV to the demand side with an integrated eight-DSDCs framework. The findings show that internal omnichannel SCI is achieved through the identified capabilities linking customer interfaces and back-end processes, and provide actionable guidance for overcoming internal SCI challenges.