The introduction of Industry 4.0, which includes a suite of advanced technologies such as the Internet of Things (IoT), big data analytics, artificial intelligence, and cyber-physical systems, has substantially altered supply chain dynamics in recent years. Digital Transformation and Industry 4.0 have emerged as pivotal paradigms reshaping the landscape of supply chain management (SCM) across industries. This study begins with an overview of classic SCM concepts and progresses to the contemporary digital era. We investigate the fundamental principles of digital transformation in SCM, emphasizing its drivers and accompanying benefits. Following that, this study delves into small and medium-sized enterprises (SMEs) and discusses their integration inside SCM systems. Through a systematic analysis of literature and case studies, this review synthesizes key methodologies, challenges, and opportunities. It highlights the importance of tailored approaches encompassing technology adoption roadmaps, pilot projects, workforce upskilling, and cyber security measures. The review also underscores the critical role of future research in developing standardized frameworks and best practices to empower SMEs in harnessing the transformative potential of the digital age within their supply chains. This study also discusses digital transformation initiatives, their impact on SCM performance, and their role in improving supply chain resilience. Finally, this research article investigates the obstacles and barriers faced during digital transformation programs, as well as future trends and consequences for practitioners and researchers.