Unleashing the Power of Big Data in Retail Supply Chains: The Partnership of Analytics and Managers

Analytics and artificial intelligence (AI) are fundamentally changing retail supply chains. Whereas analytics is heralded for its automation of decision processes, technological changes are ultimately impacting managerial roles. Our research addresses four primary issues. First, using grounded theory, we conduct in-depth interviews of 21 executives spanning the retail supply chain ecosystem to glean the current real-world application of analytics and AI. Our findings demonstrate that analytics is typically used to process large datasets and that managers regularly provide interpretation and context. Human judgment plays an increasingly greater role moving up the retail supply chain, away from the customer. Second, we identify elements of successful integration of analytics and human judgment when managers have knowledge not available to the model. Third, we use these elements to develop a framework for a successful integration process of technology and people. Fourth, we identify barriers to effective implementation of analytics systems due to managerial lack of trust in algorithms and shared data. Our paper offers guidance for effective value creation of analytics and AI via simultaneous attention to technology, people, and processes.