Caso Zara It Fast Fashion

HULT INTERNATIONAL BUSINESS SCHOOL

Zara: IT for Fast Fashion
Analysis of Zara’s approach of IT Management
Paola Cristina Mora 3/26/2012

Contents
1. 2. 3. 4. 5. 6. Zara: IT for Fast Fashion – The context................................................................................... 3 The decision................................................................................................................................ 5 The learning applied ................................................................................................................... 7 Conclusions ................................................................................................................................. 9Bibliography.............................................................................................................................. 10 Appendixes ................................................................................................................................ 11

Executive summary This document is an analysis of the “Zara: IT for Fast Fashion” Harvard Business School case. The analysis focuses on its approach to IT management and theapplicability of its approach to other companies. The first part, the “Context”, includes a brief explanation of the case focusing on its IT management and also gives references to the general current situation of the Zara today (2012). The second section, “The decision”, gives an explanation and a deeper analysis to the decision Zara´s managers face when they have to choose whether or not invest in a moremodern and better IT system. This part provides a theoretical background to the considerations the managers have to make. It provides with a deeper analysis Zara at the time of the case and also a Value Chain analysis that later one works as a base for the theory application. In the third section, “the learning applied”, the analysis is done taking into account the theory learned from IT – Module Bclass and the IT management theory presented in Laudon’s book “Management information systems: Managing the digital firm”. The examination focuses on the idea of the possibility of Zara acquiring an ERP and CRM, integrated system. It explores the advantages of such a possibility and it presents comparisons and contrasts with cases examples from the mentioned book and study cases revised in class.The conclusion focuses entirely on the realistic feasibility of the option explored in the previous section and the applicability of such option not only in Zara but in other companies.

1.

Zara: IT for Fast Fashion – The context

Inditex is one of the world's largest fashion retailers. Its consortium is made up of over 100 companies in producing textiles and manufacturing anddistributing in the fashion industry. It has almost 6000 stores in over 80 countries in Asia, Africa and the Americas. The group prides itself of having a unique business model that is based in innovation and flexibility to adjust to the changing market demands of the fashion industry. (Inditex, 2012) The business model is focused in lowering costs and in differentiation, which is still today the base of avery hard to imitate strategic advantage in the industry. (Strategy Class, 2012) Inditex’s first shop was opened in 1975 in La Coruña, Spain. From there it has expanded internationally with brands like: -Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home and Uterqüe. (Inditex, 2012) Zara is the biggest brand in the company with 73% of the group sales. Zara sells stylishclothes for women, men and children but 60% of the revenue comes from women’s clothing. (Zara: IT for Fast Fashion, 2007) The Harvard Business School “Zara: IT for fast fashion” case is placed in time in 2003. Zara’s vertical integration let it maintain short lead times, low inventories of high turnover (almost 75% of merchandise was replaced in 3 to 4 weeks) and fast speed. Zara produced 11000 new...