GROUP 4: STRATEGY

Đào Thùy Linh

Đồ ng Thị Thùy Linh
Lê Khánh Linh
Trầ n Phương Linh
Bùi Thị Quỳnh Mai

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 TABLE OF CONTENT

STRATEGY ZARA
COMPANY
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 STRATEGY Group 4 Str.

01 INTRODUCTION 04 PROPECTOR

ANALYZER WITHOUT
02 REACTOR 05 INNOVATION

ANALYZER WITH
03 DEFENDER 06 INNOVATION
 01 INTRODUCTION

Strategy is the end; structure is the

means.

A firm's strategy help determine its

organizational design, divided into 5
types: reactor, defender, prospector,
analyzer with innovation and analyzer
without innovation.

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A. EXPLORATION

Exploration includes search, variation,

risk-taking, and innovation

Exploitation includes refinement,

efficiency, selection, and
implementation

B. EXPLOITATION
02 REACTOR
The reactor strategy is characterized by a passive and adaptive approach.

The reactor strategy is the least aggressive, and organizations typically do not have any
forward looking or predictive strategy. They are not proactive and react to events as and
when they occur.

BLOCKBUSTER KODAK NOKIA

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03 DEFENDER

A defender strategy focuses on exploiting

resources and situations, with executives focusing
on maintaining a competitive position in the
market.

A defender strategy requires detailed

information to refine current products
and production methods, rather than
innovation.

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04 PROPECTOR

Seeking new market opportunities

& experimenting with new ideas,
technology, processes.

The creator of change.

Prioritizing innovation and novelty

over quality and price.

Facing risks in launching new

products.

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 05 05 ANALYZER WITHOUT
INNOVATION

DELL The analyzer without innovation is very similar to

the defender except that it does have a passive
innovation strategy or a copy strategy.

The analyzer without innovation maintains its

position by being efficient in the utilization of
resources and following others; this maintains a GATEWAY
degree of invulnerability to the moves of
competitors.

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 ANALYZER WITH
06 INNOVATION

An analyzer with innovation is a

strategy that focuses on both
exploration and exploitation.

The analyzer with innovation is a

dual strategy combining aspects
of both a defender and a
prospector.

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 ZARA
COMPANY

1.Overview

2. Strategic plan

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 Zara is one of the biggest international fashion companies, and it
OVERVIEW belongs to Inditex, one of the world’s largest distribution groups.

The customer is at the heart of our unique business model, which

includes design, production, distribution, and sales, through our
extensive retail network.

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 MISSION AND VISION

To give customers what they want, and get it to them faster than anyone else.

To contribute to the sustainable development of society and that of the environment with which Zara interact.

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A. EXPLORATION
a. How innovative are the
organization's products?
Need a lot of ideas from a
lot of design/collections
Re-design

=> Rate point 2.

b. What is the price compared to the

value of the product?
The price of Zara products can vary
depending on the specific item.
Product value is the sum of personal
value product; Service value; Human
resource value and Image value.
=> Rate point 3.

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 Zara's quality is inconsistent and depends
on the type of fabric, stitching, and finishing.

Zara's style is influenced by high-end

designers and celebrities, but also adapted
to the local market and customer
preferences.

Zara's sustainability is questionable and

controversial.

=> Rate point 3.

E. HOW DIFFICULT IS IT FOR
C. HOW FREQUENTLY DOES OTHER FIRMS TO DEVELOP
THE FIRM DEVELOP NEW RELATED PRODUCTS?
PRODUCTS?

Introduce new collections in ZARA dominates in terms of

just four weeks, as opposed to speed and the loyal customers.
the industry average of four to Therefore, the opportunity for
six months. other businesses to enter this
market is still wide, if they have
=> Rate point 5. their own creative designs, it will
D. WHAT IS THE PRICE LEVEL be easier to capture market
COMPARED TO THE QUALITY LEVEL? share.
=> Rate point 3.
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 B. EXPLOITITATION
DESIGN
DEPARTMENT
Examine fashion magazines, visit clubs,
colleges and walk around streets to
see what people are wearing and
identify potential new trends.
Zara uses digital design software to
reduce design time and allow them to
create new clothing models faster.
QUESTION A: WHAT IS THE ORGANIZATION'S
DEGREE OF PROCESS INNOVATION
COMMERCIAL SUPPLIERS
DEPARTMENT
The commercial managers analyse Negotiate with the suppliers,
the commercial viability of the items decide the purchase prices,
proposed, and if they agree with analyse costs and fix a price
them, the items are going to be
for the garment.
produced.
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B. EXPLOITITATION QUESTION A: WHAT IS THE ORGANIZATION'S
DEGREE OF PROCESS INNOVATION
=> Rate point 4.

MANUFACTURING
RETAIL
AND DISTRIBUTION

Zara integrated clothing manufacturing with Mainly through retail stores

distribution to be able to respond to changes in (>over 7,000 stores)
customer demand and preferences.
Innovation
Innovation Buil an online sales form.
-Mass production system
->Just in Time (JIT) production system

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H&M often has lower price
points compared to Zara,
appealing to a more price-
sensitive demographic. Zara
has a slightly higher price point

-> The majority of H&M’s

assortment sits between $20-35
while Zara is more elevated,
advertised at $35 onwards.
QUESTION B: WHAT ARE ITS PRICES
COMPARED TO THE COMPETITION
=> Rate point 2.
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QUESTION C: WHAT IS ITS QUALITY IN
TERMS OF ITS STANDARDIZATION AND
RELIABILITY

Standardization: Zara
warehouses have standardized
product information with common
definitions, allowing quick and
accurate preparation of designs
with clear manufacturing
instructions.

The reliability: many customers

complain about the quality of the
product.

=> Rate point 3.

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QUESTION D: WHAT THE NUMBER OF PRODUCTS OF THE
ORGANIZATION HAS COMPARED TO ITS COMPETITOR? Group 4 Str.

Zara not only has a variety of product

models but also has many different product

Besides, it has another product line under the Zara

brand name, belonging to Zara's company, Zara
Home - providing home furniture.

=> Rate point 5.

Zara men Zara women Zara Kid Zara mini

 QUESTION E: WHAT ARE THE BARRIERS
TO ENTRY IN ITS INDUSTRY?
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=> Rate point 3.

Competition Industry
(High)

Bargaining Power
Substitute threat of Customers
(Low) (Medium)

Supplier Bargaining
Power
(Low)
EXPLORATION: 3.2
EXPLOITATION: 3.4

ANALYZER
WITHOUT
INNOVATION
STRATEGY
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EFFICIENCY OR EFFECTIVENESS
 SUMMARY
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A. EXPLORATION
a. How innovative are the organization’s products? - 2 points
b. What is the price compared to the value of the product? - 3
points
c. What is the price level compared to the quality level? - 5
points
d. How frequently does the firm develop new products? - 3
points
e. How difficult is it for other firms to develop related products?
- 3 points
=> Average point: 3.2

B. EXPLOITATION
a. What is the organization’s degree of process innovation? - 4
points
b. What are its prices compared to the competition? - 2 points
c. What is its quality in terms of its standardization and
reliability? - 3 points
d. What is the number of products the organization has
compared to its competitors? - 5 points
e. What are the barriers to entry in its industry? - 3 points
=> Average point: 3.4
THANK YOU