The purpose of this report is to discuss the issue of Zara`s operating system that runson DOS . Zara is anxious about its IT infrastructure being obsolete and the possabilitythat hardware vendors will upgrade their machines leaving them unsuited with DOS.Zara`s rapidly growing business can not be continually supported by the existing ITsystem. Zara will need ultimately to change its system to a more modern system. Thenew system will permit Zara to persist its vertical integrated structure by providing astrong and scalable system, eliminating IT obsellence, and improve effeceincy of decentralization.
Zara was founded by Amancio Ortega in La Caruna, spain 1975. Zara garments storessell fashionable clothes for young, fashion concious city dwellers. Zara`s businessmodel is designed to respond quickly to rapidly changing fashion trends . The original business idea was very simple, link customer demand to manufacturing, and link manufacturing to distribution. Production process of Zara is vertically integrated sothat clothing can be designed, manufactured, and placed in stores within three weeks.Management at Zara is decentralized. Teams known as "commercials" appraiseexisting trends and choose which garments must be designed and produced.Another group of commercials, called store product managers, decide which items will sell bestin their stores and also relate to headquarter what their clients are wearing and whatextra items they think will sell in their region.Zara`smain competitors, which were other multinational clothing retailers are H&M,GAP, and Benetton. Zara is different from its compititors in four ways: 1) Zara doesvrtically no advetisment. 2) Zara only sell trendy clothes and do not try to produceclassic clothes. 3) Zara introduces new design collection throghout the year whilecompititors introduce their collections at the start of the fall\winter and spring summer season. 4) Zara has eefectivaly managed integration of demand chain with supplychain.At the beginning of 2003 Zara`s paret company , Inditex, operated 1,558 stores in 45countries of which nearly 550 were part of Zaras chain. Zara generated 73.3% of thegroup`s sale. Of the three departments inside Zara, women accounted for 60% of sales,with the rest evenly split between men and the fast growing children segment. For itsfiscal year 2002 ,Indiex has posted a net income of 502 million U.S dollars andrevenues of 3,974 million U.S dollarsm continuing a trend of rapid and profitablegrowth. The company`s earning , for instance, had more than tripled between 1996and 2000.