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Case Study Management Information Systems
Presented By: Group- 1
January 26, 2010
Analysis & Conclusion
About the Company .
the Americas.ZARA Zara. opened its first store in 1975 in La Coruña. Asia and Africa. Spain operations into 45 countries with 531 stores located in the most important shopping districts of more than 400 cities in Europe. the most profitable brand of Inditex SA the Spanish clothing retail group. Zara has remained focused on its core fashion philosophy that creativity and quality design together with a rapid response to market demands will yield profitable results .
FAST FASHION Business Strategy Operations Strategy • Cutting Edge Fashion at affordable Prices • Builds on Quick Response Time .
.Goals Develop a system the requires short lead times Increase the number of available styles and/or choice Decrease quantities produced to decrease inventory risk These goals helped to formulate a unique value proposition: to combine moderate prices with the ability to offer new clothing styles faster than its competitors.ZARA.
and distribution processes that will enable Zara to respond quickly to shifts in consumer demands. production. 2. Thus.Business Model Zara’s business model can be broken down into three basic components: 1. customer loyalty and brand recognition have provided significant value to Zara. maintaining the flexibility necessary to design and produce over 12000 new items annually. Intangibly. the parent company of Zara. Value drivers : for Zara are both tangible and intangible in the benefits that are returned to all stakeholders. has 11. 3. They have strategic agreements with local manufacturers that ensure timely delivery and service. Concept: To maintain design. Tangibly Inditex.02% net margin on operations. Capabilities: It maintains tight control over their production processes keeping design and manufacturing in-house or with some strategic partnerships located nearby .ZARA. .
and retrieval of data in a database.g MySQL .g Barcode detector . e. management control and operational control. storage. Oracle ERP ERP software applications to improve the performance of organizations' resource planning.Information Technology @Zara DBMS A DBMS is a set of software programs that controls the organization.g Napster RFID Radio-frequency identification (RFID) is a technology that uses communication via radio waves to exchange data between a reader and an electronic tag attached to an object.people soft Centralised server managing and controlling of data and command from single point e.g SAP . E. for the purpose of identification and tracking. E. management.
e.g colour design etc . ZARA uses PDA’s (personal digital assistant) to gather customer input PDA’s are also linked to stores POS system.Information Technology @Zara The blend of technology Strategy enabled Zara to break all the rules in the fashion industry Zara’s store managers leads the intelligence gathering efforts that ultimately determines what ends up on each stores rack. showing how garments ranked by Sales Zara’s Staff regularly take feedback from customers on what they they would like to see more of.
IS practical Implementation. showing its potential for supporting enterprise growth .
ZARA-IS Implementation Design Manufactur ing Distribution Retailing .
understanding differences between markets was highly relied on ‘High frequency Information Systems’. Zara’s capacity to adopt to new trends. . Shortening the product life cycle means greater success in meeting consumer preferences.Design Sources of Information POS data Industry Publication TV Internet University Campuses The company can design a new product and have finished goods in its stores in four to five weeks It can modify existing items in as little as two weeks.
Manufacturing Sources of Information Internal .T system incorporation with Toyota Production Scheduling Reduced Cost – Transportation and production Material Requirement and Planning Fully Automated Order Application .20 owned factories near Spain External – HK and Barcelona Highly Automated and Capital Intensive factories Developed J.I.
Distribution Sources of Information Centralised Distribution System Mobile Tracking Systems PDA Transportation and Logistics – – – – Factories in Arteixo Route and schedule optimization Queue Management Systems for turnaround and waiting period of the ships at the docks Air Travel (Main Costs) – Optimize routes to minimize cost and travel time inventory management Distribution center in La Coruna .
Zara’s inventory model .
Advantages Zara’s Business System through the Value Chain Vertical Integration Forward Vertical Integration – Reduces Bullwhip effect Backward Vertical Integration – Reduces Cost and Improves Quality .
Retailing Sources of Information store manager’s decision influence on the replenishment of garments there is a heavy reliance on historical information from the store manager Promoting Quick response Coordination between retailing and manufacturing Sales and trend forecasting Marketing Strategies for different markets The aggregated demand is ascertained and the supply is allocated according to past performance of the various garments at the stores .
Potential for supporting enterprise growth .
Inventory Control Distribution Constant stream of information Leads to constant input in product development process. Analysis used by designers to introduce new product line and modify existing ones Designers decide with commercial teams on fabric. Feedback from stores Sales report Helps in taking quick decisions Regional managers analyse the collected feedback. mall etc.Enterprise growth Correct prediction of Buying Behaviour and trend analysis Market research on university campuses. discos. price of new garments. cut. . direct and indirect of process and production capabilities. Control early investments in raw material. Communication and IT are essential in maintaining constant interface of various functions of management and production control.
Enterprise growth Cont Competitive Advantage Reduced Cost Reduced time and effort Customer Relations/Satisfaction Feedback – Process Improvements .
CHALLENGES ENCOUNTERED .
People Cultural Issues Language Issues Technical Issues Procedures Solution: Provision of training. Recruitment of local people. Research and analysis of various markets. . Acquisition of new workforce.
. Acquire reliable storage devices which is a critical for the company.Database Maintain huge amount of data/ data loss Organize and interpret from available data Security measures against spy Compatibility Solution: Technological Up gradation Hire skilled employees.
License issues Cost of equipment and technology Geographic and natural constraints Solution: Sharing information where there is sophisticated technology. . Working under legal boundaries.Hardware/Software 18 months technology upgrade Compatibility between hardware and software.
Formation of Local Teams to analyze the market for forecasting. Data collection procedure in different markets.Procedures Inventory management Procedure Change with technology. Sales & Trends forecasting in new markets Solution: Applying large number of POS in the supply chain. .
unlike most of the competitors weekly schedule. despite flexibility Technology and Infrastructure .Key Success Factors for Zara Business is built on quick response Production responds to trends. and proximity Technology Cost Control. KSFs: Market Research Ready raw material base Multi-functional quick decision making Vertical integration to ensure control over supply chain. Deliveries are twice weekly.
pdf www.pdf Harvard Business Review http://en.3isite.zara.3isite.org/wiki/Fast_fashion .References http://www.wikipedia.com/ www.com/articles/ImagesFashion_Zara_Part_II.com/articles/ImagesFashion_Zara_Part_I.
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