Zara grew very fast and currently in 2012 has 1,617 stores worldwide. - Rules of fashion supply chain management system 7 - Design 4 October 22, 2014 This capability allows Zara to achieve their strategy of expedited response to consumer demand. All work is written to order. The present essay deals with the operations management of ZARA, a Spanish chain store. No plagiarism, guaranteed! Case Study of Zara: A Better Fashion Business Model Zara is one of the most well known brands in the world and is also one of the largest international fashion companies. Havard Business School Working Knowledge . In order to survive in today’s challenging business world, every organization has to be confronted with highly competitive pressure to bring out more effectiveness and efficiency when running a business. A greatdeal of focus is on efficiency and effectiveness of such … OPPapers.com. Just as there is no consensus on the definition of ‘strategy’ means, ‘operations strategy’ cannot be explicitly defined. Zara use such system to differ substantially … On the average, 50% of its products are manufactured in Spain, 26% in the rest of Europe and 24% in Asian countries. In J. Fernie, & L. Sparks, LOGISTICS & RETAIL MANAGEMENT: Insights into Current Practice and Trends from Leading Experts (pp. Many competitors rely on a small elite design team that plans both design and production needs well in advance. Zara operation management, A business case! On the average, 50% of its products are manufactured in Spain, 26% in the rest of Europe and 24% in Asian countries. In their book, Operations Strategy, Nigel Slack and Mike Lewis described the four distinct perspectives on operations strategy, that have emerged, as illustrated in Fig. A case study analysis of Zaras Operations Strategy. Its under Inditex group which owns other brands such as Massimo Dutti, Pull & Bear, Oysho, Uterques and many more companies. The business related strategies and management of supply, systems relate to the way Zara runs its business. Introduction Enjoy the videos and music you love, upload original content, and share it all with friends, family, and the world on YouTube. Ferdows, K., Lewis, M. A., & Machuca, J. Spare manufacturing capacity is mirrored in the company’s storage function, where up to 400 extra staff can be drafted in during busty periods. In contrast to Zara, Express, a US traditional retailer owned by Limited Brands outsources all of its production while focusing on distributing and retailing those goods. Business, Zara is the largest division and flagship brand of the Spanish retail group Inditex [1] . A lot of centre is on proficiency and viability of such procedures. A small change in retail orders, for example, can result in wide fluctuations in factory orders after it’s transmitted through wholesalers and distributors. Zara Case Operation Management Harvard Case Study Solution and Analysis of Harvard Business Case Studies Solutions – Assignment HelpIn most courses studied at Harvard Business schools, students are provided with a case study. We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. Our academic experts are ready and waiting to assist with any writing project you may have. These computers process data on orders, sales trends and consumer reactions to products in stores. As a result, the company is able to adjust its resources to match the demands as appropriate. Supply Chain Vs Supply Chain: The Hype and The Reality. Zara brand has been said to be ‘synonymous with the cutting edge of fashion at affordable prices.’ (123helpme.com, 2008). It concludes by providing recommendations for updating the current OS along with its advantages. This is a key driver of competitive advantage through constant innovation to develop new-products that provide customers with new perceived benefits. Therefore, the strategy of “fast fashion” make Zara successful and their operation management and supply chain are their competitive advantages. Registered office: Venture House, Cross Street, Arnold, Nottingham, Nottinghamshire, NG5 7PJ. The case paper’s objective is to discuss whether to update the current DOS/IT infrastructure and evaluate the effects of the upgrade. The company is a true pioneer in providing exceptional MBA case study writing … Published: November 4, 2015 Words: 2714 Zara is the largest division and flagship brand of the Spanish retail group Inditex [1] . It does this as well as, or even more effectively than, it’s internationally acclaimed rivals such as Benetton or Gap, with one of the most effective quick-response systems in its industry.’. Free resources to assist you with your university studies! Due to Zara’s ownership and control of production, they ensure timely delivery and service. MANUFACTURING & SERVICE OPERATIONS MANAGEMENT JOURNAL , 9, 457-479. As a fashion imitator, Zara ‘s priority was to focus its attention on understanding the dynamic fashion trends, aligning these changes to meet its customers’ wants rather than on promoting predicted season’s trends via fashion shows and similar channels of influence, which the fashion industry traditionally used. And with shorter lead times, Zara can ship fewer pieces, in a greater variety of styles, more often and they can more easily cancel lines that don’t sell as well, avoiding inventory backlogs. This is due to the fact that the global apparel industry is highly labour-intensive” rather than capital-intensive and most competitors seek to cut costs in production as a profit boosting measure than explore other strategies as Zara has done. Slack, N., Chambers, S., Betts, A., & Johnson, R. (2006). 1- Executive Summary Operations management is in regard to all operations within the organization related activitiesincluding managing purchases, inventory control, quality control, storage and logistics. Another bottom-up strategy was that its store managers could report directly to the Zara headquarters, the feedback on preferences from their customers. Inditex’s operations use a vertical supply chain which is considered a very different and unique strategy in the fashion industry. Founded in 24 May ,1975 by Amancio Ortega and Rosalía Mera. ... Operations Management: Fashion Retailer Zara - Case Study Example. Zara did not only depend on the fashion trends in the industry but leveraged word-of-mouth information to create clothing that will appeal to its customers. Question. The advantage is mainly because of Zara company’s designing models that are related with business and they are compared with benefits and disadvantages with other companies which have seen success and also highlight on companies that are not successful. (Zara’s Secret for Fast Fashion, 2005). Abstract 3 Also a world leading fashion retailer brand of … Different companies apply different principles in their supply chain, and their logistic management strategies are different. Procurement and production planners make preliminary, but crucial, estimates of manufacturing costs and available capacity. This agility is defined by Martin Christopher as, ‘a business-wide capability that embraces organizational structures, information systems, logistics processes, and, in particular, mindsets.’ (The Agile Supply Chain: Competing in Volatile Markets, 2000). Retrieved April 6, 2010, from OPPapers.com: http://www.oppapers.com/essays/Zara-Case-Analysis/200153. Other production activities are completed via a network of about 500 subcontractors in close proximity to Zara’s operations at La Coruna. (Dik & Lewinski, 2002), (Ferdows, Lewis, & Machuca, 2005). *You can also browse our support articles here >. The case “Zara: IT for fast fashion” which from Harvard Business Review analyzed ore details about the basic model of Zara business, the operation process, and IT development. Financial Times/ Prentice Hall. For example, in Zara stores, Salgado should evaluate the new system so as to determine whether the commercials and the management … While it takes a cycle of six months for other fashion brands to penetrate new designs into the … (Craig, Jones, & Nieto, 2004, p. 4). (Slack, Chambers, Betts, & Johnson, 2006). However, the innovativeness of the company matters in its success level. It should not be too complicated for the employees to operate. Zara is the clothing retailer the best known as a brand of Spanish holding group Inditex (Industrias de Diseno Textil). Slack, N., & Lewis, M. (2008). The Agile Supply Chain: Competing in Volatile Markets. Excellent management team and operations; Where can I find Zara case study answers? According to Kasra Ferdows, Michael A. Lewis and Jose A.D. Machuca’s article in the Havard Business Review, (Ferdows, Lewis, & Machuca, 2005) Zara’s designers create approximately 40,000 new designs annually, from which 10,000 are selected for production. By having operations in close- proximity to its headquarters allowed for better and faster communication between functional areas for faster decision making. Rice, J. From the above illustration in Figure 2, we can deduce that operation’s strategy is concerned with the reconciliation of market requirements and operations resources. Craig, A., Jones, C., & Nieto, M. (2004, April). The added flexibility helped Zara on two fronts: shorter lead times and fewer inventories. Also, it will be shown how the ideas of operations management are put into action at ZARA. Using theoretical concepts from Supply Chain Management Review . In Search of the Bullwhip Effect. Accenture. The management of Zara provides a perfect example of successful operations management. 3.Production feedback. Since the company chooses to hand the process of design, production, and distribution all in-house its retail stores are then able to react much faster to the changing trends in fashion in comparison to their competitors. Imagine you are in charge of Zara’s supply chain operations. it is effective solution to connect all of Zara’s operations worldwide network and automating processes. Introduction. Figure 2: Improvement, Design, Planning and Control. The case study outlines how Zara transforms from a local clothing … Zara … Case Study Analysis- Zara ABSTRACT This paper is based on case study on operation management and positioning strategy of Zara, one of the world’s fastest growing manufacturers of fashion clothing. Registered Data Controller No: Z1821391. Nowadays buyers want to see a new trends quickly. Retrieved August 15, 2010, from Global research and Insights: http://www.accenture.com/Global/Research_and_Insights/Outlook/By_Alphabet/WhyMore.htm. Operations management is in regard to all operations within the organization responsible for creating goods and services that organizations pass to their customers. Study for free with our range of university lectures! Declaration: 1 What types of systems are the most essential for this company in its current environment? This paper uses the models and frameworks of the Operations Strategy module to describe & analyze how Zara’s operations strategy led to a sustainable competitive advantage in the global apparel industry. The updated real time data exchange between the stores and manufacturing units helps Zara mitigate the risk of the bullwhip effect. If you need assistance with writing your essay, our professional essay writing service is here to help! Looking for a flexible role? In today’s highly competitive and global marketplace, the pressure on organizations to find new ways to create and deliver value to the customers grows even stronger. (2009, June 04). Philadelphia, USA. Operations management challenges for wools worth: Challenges faced by human resource managers because of technical challenges: As human resource department is responsible as they manages the organization and the persons those who are working there.As the technology advances, it creates technical changes … Zara owned many of the fabric dying, processing and cutting equipment that provided Zara added control and flexibility to adopt new trends on demand. In this exercise your mental model of Zara’s supply chain will expand and your understanding of how this supply chain works will deepen. The company has operations in approximately 50 countries. - Introduction 4 Ratchanobon Kamdecha Introduction 3 Also a world leading fashion retailer brand of Inditex. Using the framework in fig 3, Zara’s operations along its value chain is analysed as follows: Zara employs a chase demand capacity management [5] in its operations. The fashion market is a fast changing one characterized by quick shifts in consumer demands. Key drivers of this reconciliation are the importance of setting appropriate performance objectives and understanding the decision areas that determine resource deployment. London & Sterling: Kogan Page. Professor Moses Niwe It their flagship range of chain stores and are headquartered in Spain. Industrial Marketing Management , 29 (1), 37-44. It supplies products to its 650 retail stores twice per week (Rice & Hoppe, 2001) in strictly limited quantities of stock. In an industry that traditionally allows retailers to change a maximum of 20 percent of their orders once the season has started, Zara lets them adjust 40 percent to 50 percent. The supply chain of Zara 6 … 1.Excecutive summary. Due to the supply chain management strategy customers are suggeste… View Zara Case Study - Operations Management.docx from MBA BSAD at Valley View University. The smooth integration between Zara business strategy and it is operation strategy as illustrated in the strategic matrix above brought about a promotion of innovativeness through a blending of its performance objectives and decision areas. This in itself provides additional value to stakeholders, customers, and stores in producing quality clothing at affordable prices. (2008). We need to give consumers what they want, and if I go to South America or Asia to make clothes, I simply can’t move fast enough.” [4] (123helpme.com, 2008). Zara’s Secret for Fast Fashion. Case Study Analysis- Zara ABSTRACT This paper is based on case study on operation management and positioning strategy of Zara, one of the world’s fastest growing manufacturers of fashion clothing. Zara continues to beat the competitors by introducing new designs into the stores within a week or two. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! Store managers to market specialists to production and design teams; this information passing loop is quick and agile that helps in delivering responses of the market at a faster rate. Retrieved September 10, 2010, from Scribd: http://www.scribd.com/doc/37281774/Zara. zara case solution The most serious issue with maintaining the current IT framework is that Zara will not grow rapidly as most vendors are changing their machines and even though, one seller guaranteed that he will keep furnishing Zara with DOS framework,however the risk connected with the customer is high in light of the fact that Zara … It sells up-to-the-minute ‘fashionability’ at low prices, in stores that are clearly focused on one particular market. Do you have a 2:1 degree or higher? Ease of operation: When upgrading the system, it should be ensured that the new system is easy to operate. The management has taken some daring entrepreneurial decisions that lead to the success and wide acceptance of the brand. In N. Slack, S. Chambers, & A. Operations management is a vital part of an organization to achieve success because . Comments (0) Add to wishlist Delete from wishlist. VAT Registration No: 842417633. This function is at the heart of all organizations, giving the means of achieving their aims and reason for their existence. Info: 3298 words (13 pages) Essay Seek our Zara operations management case study to look into how our experts add perfection to your work. Dik, R. W., & Lewinski, H. V. (2002, July). Case Study: Operations management at Zara. Retrieved April 05, 2010, from Zara’s Business Model, Information and Communication Technologies, and Competitive Analysis. Zara is a company that defines what the fashion industry has termed “fast fashion.” The flagship specialty chain of Spain-based clothing conglomerate, Inditex, Zara has built an information and distribution system that allows it to put the latest runway fashions in its stores in a matter of … (Grant, Lambert, Stock, & Ellram, 2006) This aligned Zara operations with its business strategy, ensuring comprehensiveness, correspondence and coherence to achieve its mark in the garment industry as a world leader today. The design and distribution cycle of the company takes just 10-15days in the whole process. Zara case operation management 3739 Words | 15 Pages. Zara’s Business Model is one of the finest the fashion retail industry has ever seen. When majority of the large retailers like GAP and all are struggling in many operational countries, business model of zara is giving them handsome returns in the form of a 20% yoy growth in majority of the segments (Store vs Store, QoQ etc). Zara produces most of its products in Europe. On the average, 50% of its products are manufactured in Spain, 26% in the rest of Europe and 24% in Asian countries. ... Zara employs a chase demand capacity management [5] in its operations. Kellogg's® Special K® Target Market Report, The Implementation Of The Management Functions In A Workplace. In this way, Zara avoids costly overproduction and the subsequent sales and discounting prevalent in the industry. No one delivers better case studies to help services in Australia other than MyAssignmenthelp.com. Many companies are successful in the market, for instance, Zara, IKEA, Dell, and Zipcare among many. Virginia International University Managing global supply chain 12 (OPPapers.com, 2009). This adaptive model rather than traditional merchandising is very different from its competitors. With about 5 to 6 colours in most garments of five to seven sizes, Zara’s system has to deal with something in the realm of 300,000 new stock-keeping units (SKUs), on average, every year. - History 4 purchased (ie. - Distribution and Procurement 5 It takes less than two weeks for a skirt to get from Zara’s design team in Spain to a Zara stores in any part of the globe, as much as 12 times faster than the competition. Advanced concepts and Future trends of SCM 6 : http://www.123helpme.com/view.asp?id=97642. Operations Strategy. In addition explain the external benefits of these five objectives. Zara needs just two weeks to develop a new product and get it to stores, compared to the six-month industry average, and launches around 10,000 new designs each year. - Production 4 These activities include: managing purchases, inventory control, quality control, storage and logistics. Zara outsources products of high labour intensive processes but maintains in-house capital intensive processes, protecting knowledge and know-how. An illustration of effective operations management in the selling market is clear in Zara plan of action which is expounded and examined (Samson & Singh, 2008). 232-234). Project Management-Zara POS system Case Study. This detailed case study will provide the complete knowledge of Operation management and its criteria’s. This leads to the need of more effectiveness and ef… FT/Prentice Hall. Zara’s strategy qualifies its operations as a ‘Type A’ Product-Process Mix, with high flexibility, low inventory volumes and high variety as in Figure 4 below: As further described by Ferdows et al in their article, Zara’s Secret for Fast Fashion, Zara’s development and organization facilitated an easy flow of information from customers to store managers, from store managers to market specialists and designers, from designers to production staff, from buyers to subcontractors, from warehouse managers to distributors, and so on. Zara has demonstrated this characteristic of by its flexibility. Contents Though there is a cost advantage in their approach in regards to labour, the lack of flexibility in changing orders based on current trends hinders their operational efficiencies. It provides the basic information of these organizations and how the operation strategy The aim of this case study is to analyze how ZARA has achieved its success through various business strategies. Another Quality advantage is the added sense of quality to the product as the tags would be labelled with “made in Europe” rather than “made in China” due to Zara’s trade-off between Low labour costs in Asia and operational efficiency. A. This case study and supply chain simulation will give you an appreciation of what that job is like. CMP 570 Enterprise Information Systems This case study is about Zara, large international, Operations management are all those operations concerned of the association related exercises that includes overseeing buys, stock control, quality controller, stockpiling and logistics. 1 (Slack & Lewis, Operations Strategy, 2008, p. 2): Zara boosted its innovation in a fast changing market by adapting the bottom up perspective of strategy in its operations. These are based on the dual objectives of working without stocks and responding quickly to market needs. Linking theoritical concepts and real life SCM 9 As new stock delivery schedules are regimented, customers know when new stock is due and traffic in stores is heavier at such times. Through these means, sales forecasts were pragmatic and product launches were swift as Zara was equipped with the information needed to be competitively agile in copying and launching products to align with emerging trends in the fashion industry. The business model, of the clothing retailer ZARA and discuss how the five operations performance objectives support Zara’s corporate strategy. ZARA A BUSINESS CASE STUDY Sharyn Owen ZARA A BUSINESS CASE STUDY SAMPLE. Zara is a clothing company that was founded in 1975 and came from Spain. Majo Inventory costs are higher for competitors because orders are placed for a whole season well in advance and then held in distribution facilities until periodic shipment to stores. Cachon, G. P., Randall, T., & Schmidt, G. M. (2007). Whatever the operations strategy of an organization, it must in some way reflect the requirements of the organization’s market. Case Study: Supplying Fast Fashion. Figure 3: Summary of business and operation strategies. Figure 1: Operations Management, Input-Output. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. ZARA: Fashion Follower, Industry Leader. The presentations for … Although most of their stores run out of stock, signifying that they have low dependability in terms of product availability, another perspective of dependability in terms of keeping to date with fashion is achieved. Zara became most successful brand, supply chain case study Adapting the Slack & Lewis Strategy Matrix (Nigel Slack, 2008) for Zara, The supply networks, capacity and Process technology’s speed is critical to the organization’s performance as shown in Fig 5. Table of Contents: Lower inventory cost is a key sustainable advantage as it enables Zara to manufacture and sell its products at cheaper prices. Information Technology has helped Zara to minimize production volatility that may arise from the bull-whip effect, hence bringing about a highly positive correlation in the demand and supply of products. Also, as fashion is a fast forward industry, designer plays an important part of company. Copyright © 2003 - 2021 - UKEssays is a trading name of All Answers Ltd, a company registered in England and Wales. relate to the way Zara runs its business. Though the cost of production in Spain is 17-20% more expensive than Asia, Zara does have a competitive advantage over its competitors in regards to operations. The first store opened by accident in 1975 due to a large pyjamas order cancellation. (Ferdows Kasra, 2005). Concerning Zara case study, the transformed resourced refers to the raw materials . Fundamentals of logistics management. It shows that operation management is one of major activities for Zara to support its fast fashion system. The associated differences market their differences in the level of being successful in the market. It presents the IS implementation opportunities and evaluating the effectiveness of the implementation. B., & Hoppe, R. M. (2001). SCM tools and techniques 4 Zara’s communication and coordination through high technology information systems is one of Zara’s success factors relative to its competitors. ZARA. Zara's vertically integrated supply chain system enabled the company to place the latest designs in any store across the world … Executive Summary Of course at MyAssignmenthelp.com! ZARA Zara is … - Zara information system, activities, handles the market and how it values or focuses on having a good future. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. A great deal of focus in operations. This typically can be said to be an emergent strategy as the Zara store today was not an intended strategy. This paper analyses and discusses the importance of successful operations management and supply chain on gaining competitive advantage using Zara’s operations as a case study. [2], As described in a case study of Zara’s supply chain, the company is vertically integrated, controlling most of the processes in its supply chain. In this new era of globalization, the using of technology has been very common and can be conclude as part of human’s life. 29-93). Upadhyay, S. (2009, August 21). B. Johnson, Operations and Process Management (pp. As described in a case study of Zara’s supply chain, the company is vertically integrated, controlling most of the processes in its supply chain. What types of systems are the most essential for this company in its current environment? (Upadhyay, 2009), Zara’s quick response capacity is made possible by the fact that it controls the 3 main stages of its operations that define the competitive edge of the company: design, manufacturing and distribution. In particular, we will focus on supply chain management the relation, 1. Published: 1st Jan 2015 in (2004). Zara tend to sending designer to other countries to search of new trends. Designers (of average age 26) draw the design sketches then discuss it with market specials and planning & procurement staff illustrating a flexibility of ideas generation and on the other hand the huge number of designs reflects the ability to meet almost all the fashion requirements by customers of all ages (up to 55). ‘the phenomenon of increasing demand variability in the supply chain from downstream echelons (retail) to upstream echelons (manufacturing)’. We're here to answer any questions you have about our services. With a large name in the fashion industry, besides that, Zara faces tough competition internationally, ZARA’S OPERATIONS STATEGY, A CRITIQUE OF A BUSINESS CASE. - The value chain of Zara 8 The approach to analysis includes looking, logistics management of fashion related Retailer Company named Zara which is expected to boost the value of customers and sustainability concept is considered to be added benefit to the Zara Company. From only a single apparel store in La Coruña, Zara domain has since extended to more, Supply Chain Management (SCM) System 3 INPUT 1- FACILITIES 2- STAFF INPUT TRASNFORMING RESOURCES INPUT TRANSFORMED RESOURCES 1- MATERIALS 2- INFROMATION... 4. 123HelpMe.com. The process of obtaining market information and relaying it to design and production teams expedites product development by shortening the throughput time of their products from design to store. (2005). Assessment brief: Individual students will participate in the development of an on-line discussion forum where they will provide their reflection and evaluation of the content of two (2) of the other groups’ presentations. As part of its vertical integration, Zara maintains a very high control of its supply networks as a strategy in achieving fast response. Company Registration No: 4964706. The concept of sustainability and competitive advantage is considered with other business models and compared with successful and unsuccessful company. Putting an incredible pressure on price, as often is the critical competitive variable. The vertical Integration advantage can be seen in Zara’s centralized logistics and distribution. This strategy is embraced to focus on the operations which can enhance cost efficiency while boosting service delivery and value proposition. 1. Zara’s operational goals to achieve short lead times, lower inventory and increase variety of styles/choice, together with its focus on creativity and quality is a key driver of the sustainable competitive advantage that it enjoys in the industry today. The first idea came up with Zara business is get the information or request from the customer, and then link with the design center and … Stores have little autonomy in deciding which products to display or put on sale because Headquarters plans accordingly and ships quantities as forecasted. Speed and responsiveness to Market, Zara has changed the way clothing industry works where deigning, production and delivery to the retailers requires period of six months. ZARA is a Spanish clothing and accessories retailer based in Arteixo, Galicia. Appendix 1: Mintzberg’s Concept of Emergent Strategy, Appendix 3: Zara’s Capacity utilization (Ferdows, Lewis, & Machuca, 2005), 123helpme.com. ZARA’S CASE STUDY The Strategy of the Fast Fashion Pioneer Ana Mafalda Ricardo Morgado Costa Case study submitted as partial requirement for the conferral of Master in Management Supervisor: Prof. Mónica Ferreira, Invited Professor, ISCTE Business School, Marketing, Operations and General Management Department … This case discusses the unique supply chain management practices of Spanish garments retailer Zara, which enabled it to gain competitive advantage over other fashion retailers in the world.

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