International Journal of Logistics Research and

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Iot in supply chain management: a narrative on

retail sector sustainability

Tharaka de Vass, Himanshu Shee & Shah J. Miah

To cite this article: Tharaka de Vass, Himanshu Shee & Shah J. Miah (2021) Iot in supply chain
management: a narrative on retail sector sustainability, International Journal of Logistics Research
and Applications, 24:6, 605-624, DOI: 10.1080/13675567.2020.1787970

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INTERNATIONAL JOURNAL OF LOGISTICS: RESEARCH AND APPLICATIONS
2021, VOL. 24, NO. 6, 605–624
https://doi.org/10.1080/13675567.2020.1787970

Iot in supply chain management: a narrative on retail sector

sustainability
Tharaka de Vass, Himanshu Shee and Shah J. Miah
College of Business, Victoria University, Melbourne, Australia

ABSTRACT ARTICLE HISTORY

The Internet of Things (IoT) is a global platform of Internet-connected Received 13 May 2019
smart devices that strengthens the supply chain ICT infrastructure for Accepted 22 June 2020
greater integration within an organisation and externally with suppliers
KEYWORDS
and customers. However, the IoT literature so far remains theoretical and Internet of Things; IoT; supply
excessively focused on its technology and potential applications, with a chain management; supply
very limited revelation of its operational benefits. Therefore, the study chain integration;
explores the ground reality of IoT impact on supply chain integration sustainability; retail; industry
and performance. Twelve semi-structured interviews with managers 4.0; smart supply chains
from the Australian retail industry were thematically analysed using
NVivo. The findings reveal that multiple IoT forms provide additional
capabilities in data auto-capture, visibility, intelligence, and information
sharing for greater integration of retail supply chains. That, in turn,
enhances supply chain performance in cost, quality, delivery, and
flexibility dimensions to improve firm financial, social, and
environmental sustainability. The study outlines the theoretical and
practical contributions arising from the deployment of IoT.

1. Introduction
The term Industry 4.0 was coined to signify the fourth industrial revolution, a new era conceptual-
ised as integrating the Internet of Things (IoT) into manufacturing environments so that machines
can exchange information and operate autonomously in a smart factory setting (Hofmann and
Rüsch 2017; Tjahjono et al. 2017). To make Industry 4.0 a reality, all processes in the supply
chain must be digitalised and automated (Hofmann and Rüsch 2017; Tjahjono et al. 2017). While
the cyber-physical era advances, supply chain management (SCM) continues to face the growing
challenges of digitalisation while attempting to achieve the goal of sustainability in a circular econ-
omy (Dev, Shankar, and Qaiser 2020; Hofmann and Rüsch 2017; Manavalan and Jayakrishna 2018).
On the other hand, organisations’ traditional digital capabilities are insufficient to respond to the
growing market need (Bharadwaj et al. 2013). Organisations, therefore, need to augment their capa-
bilities (Yeow, Soh, and Hansen 2018), including those that IoT offers, as a foundational technology
for transition to Industry 4.0 era (de Vass, Shee, and Miah 2018; Tjahjono et al. 2017). This paper
explores the Australian retail sector and the role of the IoT within its supply chains.
The IoT is defined as an Internet-connected global platform of uniquely addressable smart devices
with sensing, networking, processing, and actuation capabilities that facilitate the ability of people
and things to collaborate in heterogeneous environments (Borgia 2014; de Vass et al. 2018; Mishra
et al. 2016; Whitmore, Agarwal, and Da Xu 2014). The concept is a progression from the existing
Internet-connected computers to a paradigm where any physical ‘thing’ (object) is connected to
another using the Internet touch-point (node) (Borgia 2014; Whitmore, Agarwal, and Da Xu

CONTACT Tharaka de Vass [email protected]

© 2020 Informa UK Limited, trading as Taylor & Francis Group
606 T. DE VASS ET AL.

2014). A variety of IoT forms such as Radio-Frequency Identification (RFID) tags, sensors, hand-
held devices, wearables, GPS telematics, medical devices, actuators, vehicles, drones, machines,
and smartphones coexist to interact with its environment as well as with each other (Lee and Lee
2015; Mishra et al. 2016). The IoT integrates a significantly higher number of network nodes than
the conventional ICT (Information and Communication Technology) infrastructure (‘trillions ver-
sus billions’) (Hofmann and Rüsch 2017), therefore capturing, transmitting, storing and processing
more transactional data by harnessing the power of the Internet (de Vass et al. 2018; Haddud et al.
2017).
Despite the widespread recognition of the potential benefits of IoT, its application to SCM, and
operational (logistics) excellence have seldom been explored (Ben-Daya, Hassini, and Bahroun 2017;
Mishra et al. 2016; Whitmore, Agarwal, and Da Xu 2014). The literature is mostly restricted to a
focus on technology, benefits conceptualisation, and application simulation across businesses; exist-
ing research does not sufficiently demonstrate operational validity (Ben-Daya, Hassini, and Bahroun
2017; Mishra et al. 2016). A recent case study does provide in-depth insights into IoT use in trans-
portation (Hopkins and Hawking 2018) but does not discuss its implications for application across
the supply chain. Another study, by de Vass et al. (2018), finds a positive effect of IoT-enabled supply
chain integration (SCI) on supply chain and firm performance. However, the survey-focused percep-
tual research could not provide insight into the practical application of IoT in logistics processes.
Studies focusing on the applicability of IoT in SCM on operational sustainability are scarce. The
vast range of technologies that comprise the IoT, its heterogeneous applications, and capabilities
(Hopkins and Hawking 2018; Lee and Lee 2015), as well as the intricacy of SCI in the SCM context
(Alfalla-Luque, Medina-Lopez, and Dey 2013; Huo 2012), necessitate in-depth investigation. Fur-
thermore, since the literature on IoT-enabled supply chain sustainability in the context of Industry
4.0 is still at its infancy (Manavalan and Jayakrishna 2018), a greater understanding of how each of
these technologies impacts the processes in supply chains is required,
Therefore, the objective of this study is to explore the practical applications of IoT in supply
chains, and the way it affects the sustainability performance of organisations. The following research
questions guide this study:
RQ1. How does IoT implementation integrate the logistics processes of an organization internally and the sup-
pliers and customers externally?

RQ2. To what extent does the IoT-enabled process integration impact supply chain performance and firm
sustainability?

The focus of this study is the Australian retail sector. The retail industry is at the forefront of embra-
cing IoT (Balaji and Roy 2017) to overcome the challenges posed by its current practices and cus-
tomer expectations (Majeed and Rupasinghe 2017). Given that the retailers are in direct contact
with customers, digital connectivity with suppliers is particularly crucial for timely and complete
replenishment of goods to ensure the availability of merchandise. The Australian retail context
was deemed appropriate for the study because previous studies of the context report the co-existence
of various IoT forms. For example, a recent survey-based study by de Vass et al. (2018) reveals that
Australian retailers have IoT in multiple forms in their supply chains, including GPS-based location
awareness, Internet-based barcode technology, sensors and scanners, palm-held tablets/smart
devices, smartphones, mobile apps, and Internet-based security and surveillance, with at least a
single form of IoT in each supply chain. Another study, by Hopkins and Hawking (2018), documents
several in-cabin IoT technologies that truck drivers often use in road transport in Australia, such as
sensors that help in capturing vehicle speed, location, braking, and engine data; truck telematics; geo-
information to enable proactive alerts, and; camera-based technologies to improve driver safety and
fatigue. Further investigation may reveal a range of IoT technologies that enables integration of logis-
tic processes within a firm and with suppliers and customers to impact on supply chain and firm
performance. Thus, the study’s assertion that IoT may enhance the capability of retailers to integrate
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 607

internal and external logistics processes is further supported by organisational capability (OC) theory
(de Vass et al. 2018).
This paper begins by reviewing the background literature on OC theory, SCI, and IoT to identify
the gap. This is followed by the research methodology and the reports on the qualitative findings on
IoT-enabled SCI and performance. The paper then presents a discussion of the results and theoreti-
cal and managerial implications. Finally, the paper concludes with study limitations.

2. Literature review
2.1. Organisational capability theory
This study uses OC theory to argue that IoT adoption enhances the integration capabilities of retai-
lers. The question that remains is how its adoption enhances this capability. Answering this question
requires a clear understanding of OC theory in the context of ICT infrastructure as a means to inte-
grate supply chain processes. Here, we utilise a claim by Rai, Patnayakuni, and Seth (2006), which
states that ‘a firm must develop capabilities to acquire, integrate, reconfigure and release resources
that are embedded in their social, structural, and cultural context’ (Rai, Patnayakuni, and Seth
2006, 227). The OC theory posits that integration per se is a higher-order capability that influences
performance directly (Huo 2012; Rai, Patnayakuni, and Seth 2006). While ICT is often promoted as a
driver of SCI, ICT is a lower-order capability to enable a higher-order integration capability (Huo
2012; Rai, Patnayakuni, and Seth 2006). ICT itself is not guaranteed to affect performance directly;
instead, it needs to be blended with higher-order capabilities for performance improvement (Rai,
Patnayakuni, and Seth 2006). In other words, ICT alignment with organisational business processes
(integration) renders positive outcomes (Rai, Patnayakuni, and Seth 2006; Vanpoucke, Vereecke,
and Muylle 2017). ICT infrastructure assists firms to integrate their internal and external logistics
processes for sustained performance gains (Rai, Patnayakuni, and Seth 2006).
As organisations adopt technologies into their operations, they seek to integrate various func-
tional areas and processes internally and externally with suppliers and customers (Huo 2012). On
the other hand, it is the inherent capability of IoT to sense and collect data through object-to-object
interactions that entice retailers to adopt its constituent technologies (de Vass et al. 2018). When data
captured at the level of retailers is shared with suppliers, it enables the retailers to manage the inven-
tory efficiently. So, the IoT-enabled integration of processes between the business partners improves
the capability of retailers to respond to the market need quickly in a cost-effective way. The existing
literature posits that the IoT provides additional capabilities beyond traditional ICT infrastructure
(Ben-Daya, Hassini, and Bahroun 2017; de Vass et al. 2018). Such capabilities refer to the ability
to sense, auto-capture, transmit, and make the data visible locally within an organisation and
with others externally. Its application improves security, value, connectivity, intelligence, and tele-
presence (Nabeeh et al. 2019). Via real-time tracking, the IoT enhances the visibility of goods that
flow in the entire supply chain to balance the resilience and flexibility at the right cost (Ben-Daya,
Hassini, and Bahroun 2017; Manavalan and Jayakrishna 2018). Thus, IoT-enabled integration can
be viewed as an OC that IoT brings into the retail environment (de Vass et al. 2018; Huo 2012).

2.2. Supply chain integration and performance

Business processes must be designed, managed, and coordinated as a single entity to achieve a better
competitive advantage (Alfalla-Luque, Medina-Lopez, and Dey 2013; Ataseven and Nair 2017). SCI
conceptualises synchronising business processes by inter – and intra-firm management of materials,
funds, and information flow to provide the highest value to customers at the lowest cost and the top-
most speed (Alfalla-Luque, Medina-Lopez, and Dey 2013; Shee et al. 2018). SCI improves visibility,
traceability, interoperability, and collaborative decision-making to maximise supply chain perform-
ance (Reaidy, Gunasekaran, and Spalanzani 2015). Earlier empirical evidence confirms the positive
608 T. DE VASS ET AL.

impact of SCI on performance (Alfalla-Luque, Medina-Lopez, and Dey 2013; Ataseven and Nair
2017; Kim 2013; Vanpoucke, Vereecke, and Muylle 2017). A multi-dimensional approach (internal,
supplier, and customer integration) of SCI (Alfalla-Luque, Medina-Lopez, and Dey 2013; Ataseven
and Nair 2017; Yu 2015) has a direct or indirect effect on performance (Huo 2012). Internal inte-
gration breaks down functional silos and facilitates collaboration within a firm. For example, supplier
integration has been found to improve collaboration between firms and their suppliers by managing
cross-firm business processes, while customer integration has been found to strengthen downstream
linkages for a deeper understanding of market expectations and opportunities (Huo 2012; Yu 2015).
Furthermore, internal integration serves as a foundation for establishing external collaboration (Kim
2013).
In fact, ICT plays a central role in enabling SCI that facilitates information exchange in the supply
chain (Liu et al. 2016; Shee et al. 2018; Vanpoucke, Vereecke, and Muylle 2017) by acquiring, trans-
mitting, and processing data (Ben-Daya, Hassini, and Bahroun 2017). ICT strengthens the relation-
ship between SCI and both operational and financial performance (Liu et al. 2016). The interaction
between the digital and physical world continues to increase the information exchange, making con-
temporary SCM difficult if ICT is ignored. Further, studies find that ICT alone does not affect per-
formance directly, but enhances performance by strengthening SCI capabilities (Li et al. 2009; Rai,
Patnayakuni, and Seth 2006). It is important to note, however, that most SCI studies are survey-
based, grounded on generic ICT infrastructure, and that the significant contribution of emerging
technologies such as IoT is largely not adequately discussed in the SCI context (de Vass et al.
2018; Vanpoucke, Vereecke, and Muylle 2017).

2.3. IoT and supply chain integration

IoT connects billions of objects and devices to provide valuable opportunities for businesses (Abdel-
Basset et al. 2019b). The pervasive presence of the IoT has severely disrupted the way societies access
and exchange information and interact with their surroundings (Borgia 2014; Lee and Lee 2015). The
supply chain is no exception when it comes to IoT adoption. Although the term IoT was first coined
for RFID and used sparingly, the concept has evolved to include embedded technology in any phys-
ical object, generating far-reaching capabilities and eclectic diffusion (Borgia 2014; Mishra et al.
2016). As a new genre of ICT, IoT functions as a superior conduit between the physical and digital
worlds (de Vass et al. 2018; Ping et al. 2011). Further, the limitations of traditional ICT have paved
the way to this powerful platform of things (objects) with a unique identity, pervasiveness, sensing,
automation, intelligence, and communication capabilities (Constantinides, Kahlert, and de Vries
2017; de Vass et al. 2018). Despite the early stages of its inception in various forms, the pervasive
presence of IoT devices is reported to conduct real-time monitoring of almost every link in contem-
porary supply chains, enabling a seamless flow of information and goods (Ben-Daya, Hassini, and
Bahroun 2017; Hofmann and Rüsch 2017). While the IoT was first coined to track items along
the supply chain, its various forms, such as sensors, personal digital assistants (PDA), and smart-
phones, enable SCI that facilitates information exchange and physical flow (Ping et al. 2011; Yan
et al. 2014).
We define IoT in the supply chain context by consolidating the definitions of various authors
(Ben-Daya, Hassini, and Bahroun 2017; Constantinides, Kahlert, and de Vries 2017; de Vass et al.
2018; Haddud et al. 2017; Majeed and Rupasinghe 2017). IoT, therefore, is defined as an Internet-
connected platform of pervasive smart objects that can identify, sense, process, actuate, network,
and share data for timely planning and coordination of logistics processes within an organisation
and between supply chain partners. This definition has key features like digital connectivity between
objects, organisations, data capture, sharing internally and externally with suppliers and customers,
and the ability to integrate all in a supply chain.
Studies at the intersection of the IoT and supply chain management are quite limited. Linton
(2017) points out that with 2.5 million academic journal articles published to date on technology,
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 609

a smaller quantity (20,670) is on emerging technologies, and only 67 articles include both emerging
technology and SCM. Also, the literature review undertaken by Ben-Daya, Hassini, and Bahroun
(2017) indicates that the IoT in the SCM context is only conceptualised with minimal empirical
or exploratory studies. Abdel-Basset et al. (2019b), via a case study, find that communication, tech-
nology, privacy, and security are some of the challenges of IoT deployment in businesses. Ping et al.
(2011) rationalise how the IoT bridges the gap between physical and digital worlds by synchronising
the material flow with the information flow for improved SCI. Yan et al. (2014) tested an IoT archi-
tecture in controlled laboratory conditions to confirm its SCI capability. de Vass et al. (2018) present
survey-based empirical evidence of IoT capability as having a positive and significant effect on the
internal, customer, and supplier integration for performance gains.
However, survey-based empirical generalisation is criticised for its over-simplification of reality
(Wieland and Wallenburg 2012). Therefore, the demand for qualitative methodologies is rising
(Wieland and Wallenburg 2012). Also, multifaceted, intricate, and enigmatic phenomena of process
integration in an IoT environment necessitate qualitative investigation that warrants open questions
to explore relevant themes. However, very little is known about the IoT in SCM via interview-based
qualitative narratives. A title search of peer-reviewed journal articles revealed 7,537 academic articles
in peer-reviewed journals on ‘Internet of Things’, and only 60 titles containing both ‘Internet of
Things’ and ‘supply chain’. While a recent single case study was found investigating the IoT in
the logistics context (Hopkins and Hawking 2018), it did not consider the IoT for logistics process
integration in retail operations. So far, vague evidence in real-life situations of IoT deployment in
industry context has led to confusion surrounding its benefits (Nabeeh et al. 2019). While supply
chain sustainability has drawn the attention of both academics and practitioners, information gath-
ering to measure the supply chain sustainability has been traditionally challenging (Abdel-Basset
et al. 2019a). Although the IoT provides a realistic solution (Manavalan and Jayakrishna 2018),
the literature lacks the real-life proof of the IoT’s impact on retail sustainability. Therefore, this
research seeks to address this gap using an exploratory study on how IoT can integrate processes
internally and externally with suppliers and customers to improve the sustainability of the retail
sector.

3. Methodology
This study is designed as exploratory research because the phenomenon under investigation is at its
early stage of maturity and not well understood in the literature (Ardolino et al. 2017; Yin 2017). The
literature so far offers a broad conceptualisation of technology, architecture, and discrete application
(Ben-Daya, Hassini, and Bahroun 2017). An in-depth interview approach was deemed appropriate
to extend this conceptualisation by deductively exploring the contemporary use of IoT technology
from a sample of retail firms across Australia. One-on-one semi-structured interviews with a key
representative (i.e. senior manager or retail owner) from twelve retail firms and one third party logis-
tics (3PL) service provider lasted for around an hour each. The 3PL service provider (3PL-X) was
included because the participating retailers asserted that 3PL services were the key in logistics oper-
ations and remained at the forefront of IoT deployment. The 3PL, however, was not considered as
the key unit of analysis in this study and was therefore used as supporting evidence of IoT uses for
the retailers. The subject retailers were recruited from a list of participants in a prior study, who vol-
unteered to participate in the interview. Individual informants were selected due to the high likeli-
hood that their positions within the retailers would require knowledge of technology applications in
logistics operations (Brinkman 2013; Olson 2016). Discussion of sample size in qualitative research is
extensive in the literature (Sandelowski 1995); while the total sample size of 12 retail interviews may
appear small, such a limited sample lends itself well to the purpose of this research to undertake an
initial exploration of the experiences of firms and managers within them in implementing IoT in
their supply chains. Rather than analytical generalising per se, this exploratory paper aims to capture
every day ‘complexity, nuance, and dynamic’ (Emmel 2013) of IoT in SCM and sustainability.
610 T. DE VASS ET AL.

We followed the guidelines offered by Olson (2016) and Brinkman (2013) to establish a procedure
for interview preparation, participant selection, pilot testing, research questions, follow-up questions,
conducting the interviews, and interpretation of data. The interview schedule was designed to
explore the IoT technologies in practice and their operational impact. Those open-ended questions
allowed the participants to engage in an unrestricted manner to share their experience with IoT use.
The interview schedule had fifteen questions under two sections. Section one was designed to under-
stand the firm, its supply chain, and the informant. The informants were probed for their under-
standing of the IoT before providing them with a broad explanation of IoT technologies that fit
under the IoT concept. Section two explored the IoT technologies as they were deployed in-
house, supplier, and customer-related business processes and if they had yielded any observable per-
formance outcomes. However, the impact of IoT on supply chain performance and firm sustainabil-
ity per se was perceptual because it was hard to segregate the contributions that come from the IoT.
The supply chain performance was probed under traditional cost, quality, delivery, and flexibility
dimensions, and firm sustainability was assessed on economic, social, and environmental aspects.
The wording of the questions was cautiously screened to reduce social desirability bias that may
lead informants to answer favourably to the questions (Nederhof 1985). Three pilot interviews
with practitioners initially verified the relevance of the questions, sentence clarity, and content val-
idity. Feedback resulted in the refinement of the interview questions.

3.1. Thematic analysis

The interviews with twelve retailers and the 3PL were transcribed and analysed using a typical coding
process used in qualitative research (Creswell and Poth 2017; Yin 2017). The personal and firm iden-
tifiers were removed from the transcripts, and pseudonyms were assigned. The study used Braun and
Clarke’s (2006) guidelines for coding, which include six phases of thematic analysis: (1) familiarising
oneself with the data; (2) generating initial codes; (3) searching for themes; (4) reviewing themes; (5)
defining and naming, and; (6) producing the report (Braun and Clarke 2006, 87). They also suggest
that the thematic analysis is not a linear, step-by-step process, but a recursive process with back and
forth movement. NVivo 11 helped to categorise, group, organise and manage data to identify themes,
sub-themes, and their relationships. Phases 2 and 4 led to the consolidation of thematic codes. Open
coding, as discussed by Yin (2017) and others, entails the identification of themes through direct
engagement with the text, while ‘theoretical’ coding entails the identification of themes through
the literature prior to engaging with the text (Braun and Clarke 2006). This deductive, or ‘theoretical’
thematic analysis mostly focused on a ‘top-down’ way on research questions; however, a ‘bottom-up’
data-driven open coding was used to understand new themes (Braun and Clarke 2006). The coding
process was repeated twice to reduce and refine codes. Topic coding was classified as per the key
theme (Richards 2014). Predetermined themes such as IoT-enabled supplier, internal and customer
integration, supply chain performance under cost, quality, delivery and flexibility dimensions, and
firm sustainability under economic, social, and environmental dimensions correspond to topic cod-
ing. Under each theme, sub-themes emerged. Additional capabilities of IoT in the supply chains
theme was data-driven and identified under analytic coding (Richards 2014). The coding was
cross-checked, and a consensus was reached by engaging an independent coding conducted by an
alternative researcher (Ardolino et al. 2017). The codes were reviewed, and overlapping codes
were consolidated into broader groupings to avoid repetition. Patterns and relationships were ident-
ified across the data (axial coding).

4. Findings
The sample comprised twelve sectors of retail business that fall under the ABS (Australian Bureau of
Statistics) classification of retail industry segments. The majority (seven) of the informants were
from large retailers (>200 employees, as classified in the ABS), and the rest (five) were medium-
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 611

sized (20> & <200). The informants have worked for their organisation for a minimum of 2 years to a
maximum of twenty years, while IoT adoption varied from less than two years to over fifteen years.
The retail form included brick-and-mortar to e-tailing, and omnichannel. Overall, the sample rep-
resents a good cross-section of the retail industry. Table 1 illustrates the profiles of each retailer. In
the table below, the retailer is used rather than the respondent manager. The retailers’ identity is
decoded for anonymity and coded as A to L.
All thirteen managers (including the 3PL-X) demonstrated a good understanding of IoT appli-
cations and corresponding theoretical conceptualizations. Retailer-I stated that ‘it is an umbrella
term used universally where the devices capitalize the power of the Internet’. While Retailers G,
E, H asserted that their supply chains were somewhat ahead of competitors with IoT deployment,
Retailers A, F, L thought that they lagged behind competitors. Importantly, they all claimed to
have IoT technologies deployed to a reasonable degree, either as a mix of ‘things’ across the supply
chain or in logistic processes with different intensity. Many referred to retail as ‘very competitive’ and
IoT as a tool to counter the competition. All praised the impact of IoT on their supply chain oper-
ations. For example, Retailer C asserted that ‘IoT is a technology that enhances communication
within the supply chain and gets [sic] the integration better’.

4.1. The existence of IoT in Australian retail supply chains

Various technologies narrated under the IoT umbrella were found to coexist in supply chains, rein-
forcing their digital capabilities. For example, RFID was found at unit-level (i.e. pallet, container) in
warehousing and transportation. Bar-codes scanners, PDAs, RF (radio frequency) scanners, Laser,
LED scanners, and camera-based scanners were widespread. In warehousing, hand-held devices
(PDAs, RF scanners) facilitated picking orders and confirmed the product through scanning.
Also, voice-picking (an Internet-connected voice instruction and recognition system) and automatic
guided vehicles (AGV), such as an automated pallet mover or conveyor control systems, were in
widespread use. In a retail store environment, hand-held sensors and devices, point-of-sale (POS)
devices, video analytics (facial recognition for customer recognition and context-aware offers), IP
Cameras, bar-coding (unique for perishable items) and mobile payments, including Apple-Pay,
were in use.

Table 1. Summary profile of subject retailers*.

Work Key retail
ID Code exp. Job role Retail sector form Firm size First adopted IoT
1 A 2 yrs. Supply chain Cosmetic and toiletry Omni-channel Medium Less than 2 years
manager ago
2 B 11 yrs. Supply chain Department store Bricks and Large Over 11 years
manager mortar
3 C 3 yrs. Supply chain Supermarket Bricks and Large 4 years ago
manager mortar
4 D 2 yrs. Supply chain Pet products Omni-channel Large 5+ years ago
manager
5 E 3 yrs. Owner Restaurant/café/take-away Omni-channel Medium 3 years ago
6 F 4 yrs. Supply chain Telecommunication products / Omni-channel Large 3+ years ago
manager Electronics
7 G 5 yrs. Supply chain Clothing, footwear and personal Omni-channel Large Over 15 years
manager accessories
8 H 10 yrs. IT manager Motor vehicles parts and Electronics Omni-channel Medium 5+ years ago
9 I 5 yrs. Supply chain Supermarket Bricks and Large 10+ years ago
manager mortar
10 J 20 yrs. Store manager Fuel and convenience stores Bricks and Large 5 years ago
mortar
11 K 5 yrs. IT manager Security and surveillance/ Omni-channel Medium 5 years ago
Electronics
12 L 7 yrs. General manager Household goods E-tail Medium 6 years ago
*3PL-X is not part of this table because it was not counted as the unit of analysis.
612 T. DE VASS ET AL.

In the transport sector, the findings reveal that IoT-enabled track-and-trace systems, fleet control,
vehicle tracking, and route optimisation were in widespread use. IoT retina scanners and facial rec-
ognition onboard were employed to monitor driver fatigue by tracking pupil size, blink frequency,
facial expressions, and driver behaviour. IoT engine monitoring technology was also present and
used to report vehicle emissions and idle time, while sensor networks in cold-chain logistics
track-and-trace temperature-sensitive products. In the food industry, the customer can log into a
portal on their smart-phone to order, pay, and track deliveries. In general, informants stated that
delivery tracking provision for customers is considered an industry standard.
Smart-phones were found to be widely exploited. The findings identify the retailers’ drive to con-
solidate multiple devices, mainly towards the multi-faceted smart-phone. Notably, informants
expressed the view that real-time streaming analytics and reporting is a significant advancement dri-
ven by IoT. While all subject retailers have outsourced their logistics functions (i.e. transport, ware-
housing), 3PL operators came across to the researchers as early IoT adopters, with most retailers
gaining their first IoT experience via 3PL transporters.

4.2. IoT-enabled supplier integration

Perceiving that IoT deployment has improved their upstream supply chain processes, all informants
were affirmative on the vital role of IoT in the supplier integration space. Retailer E stated that ‘these
devices play a big role by bringing together our suppliers and us’. IoT plays a critical role in improv-
ing suppliers’ operational and information management, communication between suppliers and
retailers, forecasting, inbound delivery, receiving, and traceability.
Ten retailers explained that IoT technology helps suppliers fulfil retailers’ inventory stock require-
ments using critical information. Hand-held devices, scanners, label-makers, QR-code, and bar-code
label-makers and readers, Near Field Communication (NFC) devices, smart-phones, tablets, bea-
cons, various sensors in manufacturing and warehousing environments, image recognition, scan-
picking, and voice picking systems are some of the commonly deployed IoT forms for information
collection and exchange. For example, Retailer H explained how AGV systems have improved ware-
house efficiency and how the stock-take process optimisation improved via image recognition. Their
suppliers’ AGVs move with cameras that scan bar-codes of goods on its path to improve the accuracy
and efficiency of the stock-take. Retailer F articulated that the IoT helped their suppliers better
understand their manufacturing processes by evaluating the performance of machines, energy con-
sumption, ambient conditions, the status of inventory, the flow of materials via data captured by a
range of sensors, hand-held devices, and RFID.
Most retailers (eight) reported that IoT facilitated communication with suppliers for stock order-
ing and upstream information exchange. Retailer E selects items using a smart-phone app (appli-
cation), and the order is transmitted to the supplier. Eight retailers mentioned improved
forecasting processes in procurement. As per Retailer G, due to IoT data, they could provide ‘visi-
bility’ (forecasting data) of customers to their suppliers around two years in advance.
The common theme in upstream integration was the role of IoT in the inbound delivery process.
Their transporters utilise IoT forms such as GPS telemetry to find locations, track-and-trace vehicles,
fleet controlling, route optimisation, and consolidation. The 3PL-X corroborated that they provided
a full track-and-trace portal with ETA (estimated time of arrival) that updated along the entire
supply chain. Seven retailers voiced the same about international freight tracking. Three retailers
(corroborated by 3PL-X) spoke of cold-chain monitoring where they knew the exact temperature
throughout its journey to their DC (Distribution Center). Retailer C stated that ‘If the temperature
is off, we are going to get an alert. Probably that truck won’t even reach us’. Retailer B explained the
inbound process and how different IoT forms were utilised.
As the product lands in Australia, our hand-held devices alert us what container’s being picked up, weights,
VGM (Verified Gross Mass), and whether it carries dangerous, hazardous goods. We then plan the delivery.
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 613

They have automated gadgets in their trucks to know the weights remotely. When they deliver it to our DC,
geofence around the DC says it has arrived.

It was echoed that more drivers used sign-on-glass devices, instead of paper run sheets, so that the
data transmission was in real-time. Retailer G summed up by saying that ‘there are many IoT tech-
nologies throughout, working together until we receive it’. The IoT in receiving was a theme dis-
cussed by nine retailers. Retailer C claimed that efficiency in receiving had improved owing to
hand-held devices and machines connected to the IoT. Upstream traceability was another theme dis-
cussed by four retailers. The 3PL-X also corroborated that they perpetually maintained a history of
IoT data that they resorted to in case of an incident. However, the role of IoT in traceability beyond
the first-tier supplier was only discussed by Retailers A and I, where Retailer I also brought up the
potential of IoT and Blockchain integration in this space.

4.3. IoT enabled internal integration

While eleven retailers acknowledged that IoT had improved their internal logistics processes, Retai-
ler K disagreed and emphasised that their business model did not need such integration. However,
the consensus of in-house process improvement was that IoT had improved internal integration in
these select cases. Retailer H conveyed that ‘these technologies have streamlined our internal oper-
ations’ and clarified that the ‘IoT reduces data entry errors and report generation is instant’. Retailer
L explained that ‘going paperless’ improved their operation via autonomous updating and better
integration with online systems. Major themes discussed were around DCs/inventory, retail stores,
and HR operations.
The most common theme, which was only omitted by Retailers E and F (having no in-house
DCs), was the perceived role of the IoT in DCs. Retailer A explained how efficient the picking
had been using hand-held devices; such devices were found to be commonly used in warehousing
and DCs to support the receiving, slotting, picking and dispatch, or in cross-docking and split-to-
zero. Retailer C mentioned a hand-held device, termed MDT (mobile data terminal), that helped
them in receiving, product identification, and retrieval using bar-codes, right from receiving until
replenishment. Some retailers undertook location picking via voice-pick systems. There are sev-
eral sensor technologies positioned to reduce electricity usage, which is one of the highest
expenses in warehousing. Production of real-time data, reduction of inventory, increased pro-
ductivity, process optimisation by increased speed and efficiency, and reduction of human invol-
vement and staff numbers were found to be outcomes of IoT use in warehousing. Retailer H
added that
office administrators used to enter inventory data. When it goes into the system, and by the time we find errors,
it will be about two days. But, now it’s just a matter of scanning the item, and the system gets updated.

Data accuracy due to minimised human intervention, improved safety due to reduced staff numbers
on the floor, and safety measures via sensor technologies were also identified as benefits by infor-
mants. Others included security and surveillance, energy savings, convenience, and fingerprint scan-
ning for payroll purposes.
Except for Retailers A (no in-store IoT) and L (e-tailer), the other retailers discussed IoT driven
in-store technology positively. The POS devices and various hand-held devices that incorporate bar-
code technologies are standard in retail stores. Retailer B explained the PDAs’ ability to remotely
scan item bar-codes to retrieve price and information, prepare price change tickets, and print labels
instantly via a miniature Wi-Fi connected device. Retailer C further had their reports and orders
autonomously generated via scanning of products during movement. Retailer I highlighted how
self-checkouts had increased their operational efficiency, while six retailers mentioned generic Inter-
net-worked POS bar-code scanning devices. Retailers C, D, H, and I have smart-phone apps with
autonomous reporting on sales progress, inventory, sales by state, including Planograms (visual rep-
resentations of each retail store’s products), and alerts in real-time shared by cross-functional teams.
614 T. DE VASS ET AL.

Retailer D said, ‘Everyone looks on our smart-phone app to monitor sales. That’s been really helpful
for communicating the performance of our stores to everyone in the business’. Retailers D and I
spoke of the Internet-driven (unique) bar-coding technology, while Retailer D detailed their need
for such outer cutting bar-codes, ‘to be much faster in receipt of goods within the store’. Retailer
G stated that they were currently bar-code driven. Still, their global team was contemplating mov-
ing on the direction of RFID soon to improve the accuracy of data communication and service
levels.
Hand-held devices were found to serve a multiplicity of purposes, including four retailers expli-
citly mentioned using them in stock-takes. Retailer J explained that ‘RF guns are multitasking, used
for stock-take, takes and sends photos, panic buttons’. Retailer J, representing a fuel retail business,
spoke of a unique IoT application. Their underground fuel tanks have sensors fixed to track fuel
levels. The sensors feed in-store computers, as well as the central operations. These sensors send
alerts in an unusual event such as theft or when the fuel goes below a determined (analysed in
real-time) level, to remotely dispatch the next fuel trip. The manager explained that their pricing
department remotely controlled the price of fuel pumps and pricing display screens. Even their prin-
ter cartridges are monitored offsite and replenished.
Retailer E believed that IoT had revolutionised the restaurant industry, for example, by using
iPads to take orders. The restaurant owner further went on to discuss their reconciliation system,
where they register the receiving stock using an app connected with supplies and POS system
data to identify stock-in-hand and even profit and loss for the day in real-time. Even fridge temp-
erature is remotely monitored and controlled via smart-phones. Retailers C and I employ this prac-
tice too. Retailers G, K, and J have incorporated motion tracking in surveillance, while all others use
traditional remote video surveillance. Retailer E has its cash register connected to monitor sales pro-
gress remotely, enabling to compare with video to inspect if the staff is correctly entering trans-
actions. Retailer H praised the vast progression in image recognition due to the IoT, which they
were testing to examine shelf availability, as an alternative to RFID.
The key benefits of the IoT as an in-store technology reported by all informants were
improved inventory accuracy, real-time information for ordering and planning, reduced in-
store inventory, efficiency improvement, productivity, and labour savings due to reduced
human intervention. Retailer F expressed that IoT helped improve overall stock availability,
meaning that they could ‘focus more on providing customer service, rather than worrying
about inventory’. Implementation of IoT devices for identification, tracking, payroll, and access
control was identified as a growing trend by seven managers. Four of them employ FOBs (keyless
entry devices) in accessing different areas. Retailer L spoke of having fingerprint scanners con-
nected to payroll systems. Retailer K (in security and surveillance technology trade) stated that
they used facial recognition (one of their products) for access control. Advantages of such Inter-
net-connected applications were narrated as the ability to identify digitally, record, monitor,
track-and-trace each register entry in a central database, and centrally update new identities
for all scanners simultaneously.
Interestingly, only three Retailers (B, C, D) cited secondary inbound logistics operations (move-
ment of goods from DC to retail stores). Nonetheless, they all spoke of the role of IoT in this space
positively. Retailer C said that ‘we use IoT devices in our trucks for planning and safety purposes. We
track if they take the designated route within the speed limit or any idling time’.
The majority (except Retailer G) thought their DCs had the further potential to improve via IoT
deployment. Looking to the future, Retailer K discussed motion tracking by surveillance to record
evidence on breach of parameters and alert. Retailer H plans for safety cameras with image recog-
nition and image recognition technology capable of identifying inventory as one drove (or drone)
to update inventory data. Retailer L reflected that their manual DC operations drove inefficiencies
and foresaw that IoT would improve inventory management ‘exponentially’, emphasising their
need for a system that provides accurate real-time information.
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 615

4.4. IoT enabled customer integration

Retailers unanimously believed that IoT is a platform for them to connect and better serve their cus-
tomers. For harmonised downstream process improvement, IoT improved customer integration in
select cases. Retailer G said that ‘In retail, we interact directly with the consumer. If we can get the
right data and communicate effectively, that converts into better service levels for the customer’.
Retailer E added that, ‘it [IoT] has been a good progression, as lots of new applications coming
in, especially when it comes to customer-side applications’. Major themes reported under customer
integration were in-store applications, understanding customers, promotions, improving online
presence, picking and dispatch, deliveries, receipt, and improve ratings.
Except for e-tailer L, all others articulated that IoT in-store applications facilitated customer inter-
action in brick-and-mortar retail. Bar-coding and POS devices improved speed, and nine retailers
discussed convenience for customers. Retailer I revealed that self-checkouts made it fast and con-
venient for customers. Retailers C and I articulated that individual item (unique) bar-coding on pri-
cing perishable products (i.e. meat, deli products) improved the speed and convenience of POS
check-outs for customers. Five retailers mentioned that item-level RFID would help reduce check-
out time, as ‘customers don’t like waiting’. Retailer J described their piloted self-checkout phone
app: ‘
you take your stuff, scan them and put them in the basket and walk out’.

Product availability due to real-time data, thus lost sale minimisation, and customer retention was a
theme discussed by six retailers. Retailer F revealed that ‘when customers don’t get to open up their
shiny new phone straight away, they get disappointed. It is called ‘unbox therapy’. We cannot have
products unavailable in our stores’.
How digital payment methods have reduced hard currency circulation was the next important
theme discussed by seven retailers. Retailers spoke of EFTPOS (Electronic funds transfer at point
of sale) machines encouraging digital currency (rather than carrying cash), and now the wireless ver-
sions making EFTPOS even more convenient. Retailer G asserted that ‘EFTPOS machines are pro-
gressively providing a seamless service’. Some spoke of evolving EFTPOS technologies from
magnetic strips in bank-cards to pay-wave via an electronic chip (tap and go options via NFC),
while some cited payment via smart-phones (such as Apple Pay) and smartwatches. Retailer J
described a recently introduced app by a competitor that enables customers to pay for the fuel at
the pump rather than going inside the store. Retailer C and I explained an IoT-based image recog-
nition used in their car parks to combat vehicles exceeding the parking limit.
Seven retailers discussed understanding customer needs via the in-depth data captured by IoT
devices. Combining POS data with reward cards to analyse the demographics of their customers
was addressed by four informants. Retailer G analyses data from ‘people counters’ (who comes in
and out) and ‘sale-through information’ (products they buy) with demographics (age group) facial
recognition. Retailer K corroborated that many retailers have purchased such systems from them to
analyse customer buying behaviour.
Eight retailers spoke of smart-phones as a medium to reach customers by helping customers
find retailers and retailers to promote products. Retailer L pointed out that ‘IoT definitely
helps us reach customers, given everyone has smart-phones now and having access to Internet
24/7’. Another key theme discussed by six retailers is IoT location awareness, specifically on
smart-phones, helping them find the nearest (or specific) store locations and providing GPS direc-
tions to get there. Retailer J mentioned the promotion of a different kind, which is an app that
enables price matching by checking the fuel prices around the area. Retailer D’s customers can
use an app to track their loyalty points and discover store promotions. Retailer G revealed that
their centrally managed IoT-based facial recognition system demographically (age group, gender)
customise in-store product advertisements. Retailer K explained the scenario as ‘if a kid walks in,
the nearest advertising screen will display a kids meal’ and confirmed that they (as IoT product
616 T. DE VASS ET AL.

for retailers) had installed facial recognition to influence customer behaviour in many retail
environments.
The way customers find products and place orders, is another essential sphere influenced by IoT
application, as reported by six informants. Retailer E articulated the view that the restaurant industry
is intensely disrupted by IoT, primarily owing to self-ordering. In-store, they provide iPads for cus-
tomers, improving sales due to customers being able to make multiple orders at any point. The res-
taurant also has its smart-phone application for customers to make orders remotely. Four retailers
highlighted the prevalence of third-party apps (i.e. UberEats) that connected retailers, customers,
and deliverers, providing purchasing options, taking orders, charging, and organising the delivery
(4PL model).
When an online order is received, how IoT ensures accurate and timely picking to enable speedy
dispatch is a theme cited by four informants who conduct online sales. Retailer A expressed the view
that the customer’s primary objective is to receive their delivery in full and on-time (DIFOT); thus,
the technology to support this is necessary. Retailer H described how IoT hand-held devices enable
timely, accurate dispatch, while autonomously notifying the progress to the customers. Retailer D
stated that their biggest challenge was their dispatch not being efficient enough, thus negatively
affecting their online sales. However, with the current system that incorporates various IoT technol-
ogies, they have been able to improve their processes, so that when the customer places an order, the
system goes around in a dynamic process to find the closest store, where the order is best available,
closest to the delivery route and the cheapest freight rate, then their held-held devices assist store staff
pick the order quickly and notify deliverers to pick-up.
Eight retailers affirmed that IoT improve their customer-order delivery process. All had their
downstream delivery process outsourced. Retailer D explained their delivery tracking process as
‘the couriers track the delivery from our doorstep, right to the customers, so the customer and us
both can track it via a portal. There will be a progressive real-time notification to the customers
and us’. When it comes to delivery, six retailers discussed visibility as a key IoT benefit. Retailer
K explained that, ‘overall, I would think that it improves customer service levels, as we can see
what is happening with their package in real-time’. Retailer E asserted that with app-based (4PL)
food delivery services, customers could track their delivery at all times, and ‘customers love it’ as
the process is much more convenient. Six retailers cited ‘automated alerts’ at critical points during
the delivery process. Retailer H claimed, ‘back in the day, it was hard to track an item ordered from
overseas or even from within Australia. However, now, one can track and be alerted from the source
to customer’. Providing good route options for deliverers was another critical feature discussed by
four retailers. Shorter/optimised/best-route, retrieving optimised destination sequence, avoiding
traffic, order consolidation, and efficient movement were some rewards identified within this
theme. 3PL-X also corroborated that such technology was in use in delivery optimisation. Retailer
F asserted that delivery is an area they could improve with IoT; they had no such integration and
visibility until the supplier manually entered into the system.
Five retailers raised the theme of IoT as a platform to receive (or improve) customer ratings.
Retailer H claimed that ‘the best thing of this pervasive computing is ratings and reviews. It has pro-
vided a convenient platform for people to rate and review us’. Retailer E described that the restaurant
industry is very much review-based. When a customer visits a restaurant (or any other establish-
ment), search engines identify them through their smartphone’s location awareness and request
that customers rate the place. Further, when a (4PL) food delivery service makes a delivery, the res-
taurant, the products, and the driver can be evaluated via the app. All retailers agreed that smart-
phone presence increases the extent of ratings.
Despite the heterogeneous nature of the downstream operation in various businesses, one theme
that unanimously emerged was customer satisfaction. The four fundamental aspects the retailers
mostly relied on the IoT for were understanding customer needs, promotions, suggestions on
what customers should purchase (to influence customers), improving customer satisfaction, and
finally encouraging reviews and the improvement of ratings.
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 617

4.5. Additional capabilities of IoT in supply chains

The capabilities advanced by IoT can be themed under visibility, auto-capture, intelligence, and
improved information sharing and collaboration. The critical value addition identified by ten retai-
lers included enhanced visibility in supply chains owing to its pervasiveness. Retailer G stated that ‘it
is visibility at every point of the supply chain … it will tell you exactly where our product is’. More
importantly, six managers emphasised its real-time visibility aspect. For example, Retailer H high-
lighted that ‘everyone is looking at getting real-time information into the system. That’s why IoT
is so important for us’. Seven retailers highlighted how IoT devices auto-capture data, therefore redu-
cing labour requirements. As Retailer H explained, ‘now, you take it, scan it and pass it on. This is a
seamless process. Earlier, they had to fill a form, and someone else did the data entry’. Ten managers
highlighted higher intelligence for decision-making due to analysing in-depth data captured by IoT
devices. Specifically, five managers spoke encouragingly of real-time streaming analytics of IoT data
for immediate action/reaction. Moreover, six retailers established that having IoT devices linking
their supply chain entities and having extra data available has improved information sharing and
communication between the firm and its suppliers for greater collaboration. Retailer C reinforced,
‘IoT is enabling us to communicate better with 3PLs, customers or supplies’.

4.6. How IoT-enabled supply chain integration affects supply chain performance
All twelve retailers (and 3PL-X) were positive about the outcomes of IoT deployment, as well as its
potential to improve supply chain performance. The critical performance outcomes can be grouped
under operational performance dynamics of cost, quality, delivery, and flexibility. Cost reduction is a
crucial performance dynamic, addressed by all except Retailer I, who thought that the cost of the
technology investment offset the savings. Retailer E said, ‘IoT use definitely reduced overall supply
chain cost … … .it can reduce the cost of the suppliers, their delivery cost and also our operational
cost’. Under cost savings, efficiency (ten retailers), productivity (nine), optimisation (eight), time-
saving (seven), energy-saving (six), inventory reduction (five), and reduced wastage (three) emerged
as key sub-themes. All retailers cited quality improvement but under various aspects. Service quality
(ten retailers), accuracy (eight), customer service (eight), convenience (six), safety (five), and product
quality (five) were the key sub-themes. Nine retailers cited the delivery standard as a key dimension.
Retailer A felt that ‘location-based technology not only improves the efficiency of the delivery but
also delivers to the precise location, improving delivery quality and accuracy’. Retailers articulated
delivery speed (five retailers), accuracy (four), timely deliveries (four), and responsiveness (three)
as sub-themes. Nine retailers reported that the IoT provided them with more operational flexibility.
Retailer H explained that ‘it improves flexibility because you get everything live, so you have time to
do different things’.
The findings from the retailers’ perspective of these select cases suggest that integration of IoT
devices to logistics processes improves the cost, quality, delivery, and flexibility dynamics of their
supply chain. While 3PL-X explained how their IoT deployment had affected the performance
dimensions and emphasised on those benefits that were passed on to their clients (retailers) to
win and retain contracts.

4.7. How IoT-enabled SCI impacts firm sustainability

All retailers reported a positive effect of IoT-enabled SCI on the triple bottom line of firm sustain-
ability. They (including the 3PL-X) agreed that IoT deployment in logistics processes affects their
economic outcomes positively. Retailer E was fully confident that ‘there is a financial gain in
using these technologies’. Many informants reported that the IoT helped directly or indirectly in
company growth (eleven retailers), cost reduction (nine), sales growth (eight), customer satisfaction
(six), lost sales reduction (six), consumer trust (five), customer retention (four), brand reputation
618 T. DE VASS ET AL.

(four), the return of investments (four) and competitive edge (four). Retailer H stated, ‘we assume
that we are finding information faster than anyone else and obviously gives us the edge over com-
petitors. It is all about who takes the next move first’. Retailer I articulated that the integration of
technologies such as IoT and Blockchain could improve brand integrity, credibility, and brand
trust through improved communication and transparency. Also, seven retailers agreed that various
forms of IoT applications helped their 3PL providers minimised their charges of logistics services.
Retailer C supported with ‘a reason that 3PLs can give us such low prices as they use these technol-
ogies for efficiency’.
Environmental sustainability was an outcome reported by all retailers and 3PL-X. Retailer G
highlighted that ‘[IoT] is a big part of us being an environmentally sustainable company’. The
impact of IoT on environmental sustainability was diverse, with reduced use of paper as the
most frequent (nine retailers) theme, followed by reduction of carbon-footprint (six), electri-
city-saving (six), and waste minimisation (three). The 3PL-X commented that ‘putting these tech-
nologies [into use] is a way we can reduce our emissions and reduce our negative impact, which is
very important in transport and warehousing. As per the chain of responsibility, it finally impacts
our clients (retailers)’.
Eleven retailers (and 3PL-X) revealed the social impact of IoT deployment. Retailer F stated,
‘IoT has done lots, and the potential is more in terms of social aspects’. Safety (seven retailers)
emerged as the principal theme followed by job satisfaction (five) and ease of use (four). Creating
communities, specifically using smart-phone apps, was a theme discussed by four retailers. Retai-
lers H and I indicated that having such advanced technologies (as IoT) in place created a pride
among staff members.
Figure 1 below summarises the overall findings of how IoT deployment integrates the supply
chain processes and ultimately improves the sustainability of retail firms.

Figure 1. Findings of how IoT enable firm sustainability in Australian retail.

 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 619

5. Discussion and implications

This exploratory study reveals how the IoT can strengthen supply chain ICT infrastructure to impact
SCI and subsequently improve the performance of Australian retail supply chains and firms. Confi-
rming its popularity, all study informants were mindful of the IoT’s disruptive effect on SCM. Nota-
bly, the study reveals the coexistence of a vast array of primary IoT forms facilitating Australian retail
supply chains. The finding corroborates with de Vass et al. (2018)’s empirical study in the same con-
text and Hopkins and Hawking (2018)’s single case study on an Australian transporter. In contrast to
the findings of Tu (2018), the widespread diffusion of primary forms of IoT was evident in the Aus-
tralian retail supply chain context. Popular forms of IoT are location-based telemetry (use of GPS
and sensor data together), smart-phones, palm-held devices, sensors, scanners, IP-cameras, security
and surveillance devices, and bar-coding systems. While all informants reported the benefits from
IoT to integrate their supply chains further, the best value addition was evident when multiple
IoT forms are deployed collectively.
Although the scholars suggest for an item-level tagging (Ben-Daya, Hassini, and Bahroun 2017;
Hofmann and Rüsch 2017), the RFID is mostly utilised so far at the unit level (i.e. box, pallets, and
container). However, digital communication via smart-phones is progressively more exploited.
Given that individuals inevitably carry smart-phones, there seems to be a drive to piggy-back on
its resources as the central device for customer integration.
This exploratory study further unearths how each SCI dimension is affected by IoT deployment.
For instance, IoT data at the retail point, when shared with suppliers, improve their processes to fulfil
retailers’ inventory needs. Furthermore, the information exchange with suppliers helps in inventory
forecasting, timely delivery, receiving, and traceability processes. Similarly, IoT deployment benefits
in-house logistics functions such as inventory management, transportation schedule, and customer
order fulfilment. Importantly, this study reveals that IoT improves communication among func-
tional silos within the retail firm helping each key person to access the data. Also, IoT, as in-store
technology, enhances the customer’s shopping experience. For example, the IoT facilitates multiple
interactions between customers and products/services. For the online presence of retailers, the IoT
can anticipate customer requirements and help to pick and offer delivery schedules all tailored to
their specific needs. Retailers further capitalise on data that are captured through IoT technologies
to demographically identify customer needs that trigger promotions and shopping suggestions to
improve sales. Reliance on the IoT not only helps improve retailers’ customer ratings, it also facili-
tates customers capacity to rate/review retailers’ services for improvement. Interviewees suggest that
IoT potentially has a more significant role to play in a rating-based economy for retailers to compete
in the market.
The findings validate IoT related conceptual discussion, theory, and anecdotal evidence of the
plausible benefits of partner integration in literature. Prior studies, for example, includes the pro-
posed distributed architecture of supply chain over the IoT (Ping et al. 2011); proposal for IoT infra-
structure for collaborative warehouse management (Reaidy, Gunasekaran, and Spalanzani 2015); a
conjoined prototype of IoT and cloud to integrate supply chain processes (Yan et al. 2014) and the
empirical study on the impact of IoT on SCI (de Vass et al. 2018). This exploration, however, extends
the scope of prior studies to reveal proof-of-concept of IoT use in retail supply chains has improved
SCI to have a positive effect on supply chain and firm sustainability.
The findings of this study further reveal that IoT-enabled SCI improves supply chain perform-
ance. More specifically, supplier-, internal-, and customer-related processes are integrated and
made visible by using IoT-generated data. This enhances the supply chain performance dimensions
on cost, quality, delivery, and flexibility. For example, retailers consistently stated that cost was
reduced through improved efficiency that IoT offer; quality improvement (e.g. DIFOT) occurs by
enhanced services. However, this depends on the retailer-specific initiative, the forms of the IoT
in action, and the extent it is integrated into operational processes. These exploratory findings sup-
port the argument that IoT deployment enhances supply chain operations (Ben-Daya, Hassini, and
620 T. DE VASS ET AL.

Bahroun 2017; Haddud et al. 2017). It also corroborates the importance of engaging with ‘on the
ground’ narratives from managers, as proposed in the study by de Vass et al. (2018).
This study also qualitatively assessed the IoT deployment for its ability to enhance the retailers’
operational capabilities. The findings suggest that the IoT-enabled SCI offers additional capabilities
such as data auto-capture (automation), visibility (real-time), intelligence (real-time insights), and
improved communications internally and externally with business partners. The findings are signifi-
cant in the sense that no earlier studies so far have attempted to find what additional capabilities that
various forms of the IoT provide. As we embark on the Industry 4.0 era, the IoT is considered one of
its founding technologies (Ben-Daya, Hassini, and Bahroun 2017; Hofmann and Rüsch 2017), which
offer data auto-capture ability within cyber-physical systems. As retailers are increasingly moving
towards the digitalisation of logistics activities, IoT functionalities need to be factored in for more
pervasive, reliable, and real-time visibility in the supply chains. As cloud technologies are hosting
more and more storage and processing power, big-data analytics, artificial intelligence/machine
learning (AI/ML), and Blockchain are making further inroads, where IoT may provide higher intel-
ligence on the flow of goods helping in key decision-making. Also, many novel technologies are being
added to the expanding list of IoT forms in the proposed Industry 4.0. Therefore, the findings of this
study can provide a basis to understand the capabilities that IoT can offer in future smart supply
chains connecting machines over the Internet.
This study furthermore found that IoT-enabled SCI has improved the retailers’ sustainable per-
formance measured on economic, environmental, and social outcomes. The findings substantiate the
conceptual discussions of IoT adoption that are likely to improve the supply chain sustainability
(Borgia 2014; Manavalan and Jayakrishna 2018). For example, IoT-enabled SCM was have improved
the retail firms’ financial performance by fostering growth, reducing costs, and representing a posi-
tive return on investment. Environmental sustainability impact is evidenced primarily due to paper-
less operations, reduced carbon footprints, reduced energy consumption, waste minimisation, and
recycling. Further, the social performance was realised by improved safety and job satisfaction, creat-
ing communities, and new job opportunities, which may transform into longstanding value. More-
over, IoT applications free up retailers’ time that is allocated more on productive and innovative
tasks, and planning activities. While the discussion on circular economy and sustainable supply
chain intensifies, these findings on how IoT fits into the Industry 4.0 framework are beneficial
(Dev, Shankar, and Qaiser 2020).

5.1. Theoretical implications

This study contributes theoretically to the SCM literature, where the IoT related studies are still
emerging. It fills a methodological gap in the literature (Linton 2017) by undertaking an inter-
view-based qualitative investigation of IoT technology applications in the retail context (Abdel-Bas-
set et al. 2019a; 2019b). The literature thus far has focused on conceptualising the impact of IoT
technologies in supply chain processes (i.e. source, make, delivery, return), while providing a limited
empirical account of its practical application (Ben-Daya, Hassini, and Bahroun 2017). The one
exception is the case of a 3PL provider investigated by Hopkins and Hawking (2018), which
found that the IoT is being used in the sector to enhance driver safety, lower operating costs, and
reduce the environmental impact of vehicle movement. Nevertheless, such findings remain within
the in-cabin deployment and have not been interpreted for their potential to improve the logistics
processes of customers. Tu (2018), using mixed methods, found perceived benefits, costs, and exter-
nal pressures to determine the IoT adoption in the supply chain. As supply chain technology adop-
tion is more evident in retail operations across the sectors (Balaji and Roy 2017), the potential
benefits of the IoT in managing the retail logistics process remain primarily theoretical, for the retai-
lers those who are increasingly looking for evidence before they move on to adopt advanced forms of
IoT (e.g. smartphone, palm-held devices, more sensors at every touchpoint, GPS and surveillance
cameras) to track and trace the movement of goods along the retail chain. This study is the first
 INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 621

of its kind to reveal the practical application of IoT technologies. This is unique in the sense that this
study has established the prospective retailers’ confidence in implementing the latest form of IoT
technologies based on the experience of the sample respondents discussed in the findings.
From an OC perspective, this study argues that IoT implementation improves the existing ICT
infrastructure that offers retailers an ability to integrate their internal and external logistics processes.
Thus, the IoT enhances the organisational (retailers) capabilities by improving their ability to collect
the data and store and analyse it for better business intelligence (e.g. supplier and customer-related
decision). This takes the knowledge a step forward where the IoT brings in additional capability over
the legacy ICT ecosystems for real-time data capture allowing the suppliers and customers to make
better operational decisions through data integration (Balaji and Roy 2017).

5.2. Practical implications

As technologies progressed, retailers have gradually internalised traditional ICT such as telephone,
fax, email, bar codes, RFID, EDI, and ERP to support their logistics functions (Vanpoucke, Vereecke,
and Muylle 2017). However, they must be wondering how the emerging IoT can enhance business
values. Further, they are constrained and cannot decide on the appropriate technologies because of
the limited knowledge and lack of experience in IoT deployment in enterprises (Nabeeh et al. 2019).
This study contributes to bridging this gap by providing real-life insights from IoT users among Aus-
tralian retailers. IoT technology (RFID being the earlier form) is not new in logistics, and the tracking
and tracing of goods using ICT (i.e. GPS) have been around for years. However, what is new today is
the availability of various forms of IoT technologies with better business value-add. The emerging
IoT in the form of sensors, actuators, smart mobile, and near field communicators can facilitate con-
nectivity, security, event monitoring, and advanced analytics for business intelligence. This is ben-
efiting retail logistics operations, suppliers, and customers. Therefore, smart supply chains
powered by IoT technologies offer a practical tool for retailers and helps in further proliferation
of IoT in this space. This proliferation not only improves sustainability but also captures in-depth
information that may help further evaluate the improvement (Abdel-Basset et al. 2019a). With retail
being at the forefront of IoT digitalisation (Balaji and Roy 2017), it may lose the competitive edge if
adoption decisions are delayed. Further, IoT being massive in its potential and disruptive nature, its
functionalities are considered as an extension of the previous ICT. However, the earlier technologies
are overly computer-based (e.g. robotics, computer-integrated manufacturing, and design, actuators,
and sensors), whereas the IoT technologies, in contrast, are characterised by machine-to-machine
communication indicating its presence over Internet-based systems. In this Internet-centric para-
digm shift, the retailers can see object-to-object and object-to-human communication where more
data can be stored, analysed, and communicated for real-time intelligence. For instance, a fully func-
tional IoT based system prototype can be designed using the design science research (Miah, Gam-
mack, and McKay 2019) as a demonstrative solution case for addressing the Industry 4.0 demands.
Therefore, the findings may serve as a piece of concrete evidence and inspire practicing managers,
industry associations, and policymakers to speed up spending in IoT adoption decisions and related
policy. Ultimately, this technology enhancement may better serve the customer at a lower cost while
preserving the environment and up-keeping social aspects.

6. Conclusion
This exploratory study of Australian retail supply chains reveals that IoT implementation improves
logistics processes internally within the retail sector and externally with suppliers and customers.
This demonstrates the on-the-ground benefits of adoption and integration of IoT technologies
and therefore complements and expands on the primarily theoretical benefits identified in the litera-
ture thus far. Thematic analysis of semi-structured interviews with retail practitioners shows that the
IoT comes with additional capabilities, namely visibility, auto-capture, intelligence, and information
622 T. DE VASS ET AL.

sharing. This enables the integration of logistics processes and improves the supply chain perform-
ance dynamics on cost, quality, delivery, and flexibility, which also impact the retail firm’s sustain-
ability (economic, environmental, and social). The findings may inspire managers, industry
associations, and policymakers to understand the importance of IoT-enabled smart supply chains
in this Industry 4.0 era.
There are a few limitations that may guide future studies. The case interviews were intended to
gather the evidence of IoT benefits and the extent of its capability to integrate the logistics processes.
This approach included retailers across sectors, but no single sector had a major representation of
retailers. The limitations in the sample size posed an issue of the generalizability of the findings.
Therefore, future research needs to include more retailers from each specific sector, having a sample
size big enough to carry out intergroup analysis among small, medium, and large retailers. This
analysis will offer insights on the IoT implementation where the process integration may vary
depending on firm size or the specific sector. Moreover, even though IoT is conceptualised to
gain visibility throughout the supply chain (Ben-Daya, Hassini, and Bahroun 2017; Majeed and
Rupasinghe 2017), the study is limited to retailers’ perspective. Involving the first-tier partners
(i.e. supplier, customer) or ideally beyond the first-tier (i.e. grower) vertically, and also 3PL service
providers and other horizontal partners may reveal more objective evaluation of sustainability via
IoT along the supply chain and demonstrate how the benefits are shared. Given the impact of the
IoT in SCM is identified, exploring opportunities and challenges to effective IoT implementation
may offer additional insights for future Industry 4.0 proliferation. While the findings unearth very
little activity of IoT in reverse logistics, exploring the obstacles and enablers of IoT in closed-loop
SCM space is also vital as we pursue a circular economy.

Disclosure statement
No potential conflict of interest was reported by the author(s).

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