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Global Business Design Championship 2013 -H&M- GIE 6083 -13

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Transcript of Global Business Design Championship 2013 -H&M- GIE 6083 -13

Offer
Creation
Business > $ 1 B

Our team
An academic submission to Professor Benoit Montreuil
GIE-6083 Global Business Design
FSA, Université Laval, Québec, Canada
Francis
Langlois
Marie-Michèle Godin
Catherine
Taillon-Desrochers
2013
Stakeholders
We applied the Tetrahedral business design framework to H&M
How global and
holistic is H&M
Business Design Framework
Character
World Scale
Social Utility
?

Holistic approach
The first store was opened on the high street of Västerås, Sweden in 1947
By Erling Persson
Strategy Evolution
- 1947 First store in Sweden
- 1970s First store outside Scandinavia (London, UK)
- 1980s New stores in Europe
- 1990s Development of more European markets
- 2000 First store in the US (5th Avenue, NYC) and in Spain
- 2004 Designer collaborations starting
Lagerfeld, McCartney, Madonna, Cavalli, Beckham, etc.)
- 2006-2010 Major expansion of online sales, new stores worldwide (Asia, Eastern Europe, Latin America)

PAST STRATEGIES
Who was the business? (1/2)
- Originally produced Camping and hunting Equipment (1872)
- Sporting goods and equipment (1900’s)
« Greatest Sporting Goods Store in the World » (1939)

- Refuse to export
- Exclusive image (create passion, enthusiasm)
Brand's values
But..
Owners and important managers
Around 104.000 employees worldwide

Conception Teams : designers, buyers, assistants, pattern makers, section managers, controllers.

Chosen for their capacity to innovate, create and identify new trends





Key Staff
TALENT
TALENT
Clients
Stakeholders Map
Suppliers Workers
Offer
High fashion at a low price
In more than 3.000 own brand stores and 53 markets
Constant renewal in the clothing offer
Latest trends available to a mass market
Refund within 30 days of the purchase without the receipt

Customers
Staff
Offer
Collections openly inspired by designers artwork
High
Fashion at
a low
price
H&M can offer collections at low prices using efficient logistics

Research on demographics before investment decision

All stores are company owned (to ensure the uniformity ot the retail concept)
Tetrahedral
'' To us, design, quality and sustainability are not a question of price: we should always offer inspiring fashion with unbeatable value for money. ''
Overall Themes
Concepts
Today's Culture
TALENT
ENABLER
CLIENT
H&M website
Mission
& Vision
'' We believe in people
We are one team
Straightforward and open-minded
Keep it simple
Entrepreneurial spirit
Constant improvement
Cost-consciousness ''
Online shipping available in many countries
Online size guide and garment care guide
Communities
15.5M fans on Facbook
2.7M followers on Twitter
Pinterest, G+, TumblR, Youtube...
Fully mobile adapted shop online
Mobile Apps
CLIENT
Online
for your attention!
By the way, here is our video:
Thank you
An entry to the
What's their business model?
NOTE: This Prezi presentation has been designed
to be watched full screen, please do so !
Adapted from:
S. Caisse (2008)
Adapted from:
Benko & McFarlan (2003)
Global Business Design
Championship

Headquarters : Stockholm, Sweden

Activity : Apparel retailer

CEO : Karl-Johan Persson



''H&M’s business operations aim to be run in
a way that is economically, socially and environmentally sustainable. By sustainable,
we mean that the needs of both present and
future generations must be fulfilled.''
''We have a responsibility towards everyone who contributes to our success, including those
who are not employees of H&M. That is why
we work closely with our suppliers to develop sustainable social and environmental
standards in the factories that manufacture
H&M’s products.''
H&M website
''H&M’s business concept is to offer
fashion and quality at the best price.''

''We must continuously review the company’s goals and strategies to reduce the company’s climate impact.''
H&M website
- Be spot-on. In everything.
- Choose the best place for a store
- Self-finance
- Control growth and maintain profitability

STAKEHOLDERS
H&M Website
- Planned up to 1 year in advance

Latest Trends
- Picked up at short notice
- Different set of suppliers
High Fashion
Current Fashion
Modern Basics
Sold exclusively in big cities' stores
Influenced by what was sold last season combined with the coming season's big trends, colours and models, the location and the size of the stores
Large volumes distributed to most stores
Role of Concept Teams
- Find the right merchandise for each concept
- Each team contains designers, buyers, assistants, pattern makers, section
managers and controllers
Distributors from many countries
Stores in 48 countries (at the end of 2012)
Expending to new countries in 2013
''Conscious'' - A sustainable collection
Creates a lot of jobs
More than 104 000 employees work for H&M and more than a million for its suppliers worldwide
Makes fashion more accessible
In both developed and developing countries
Excellent quality and price ratio
Sustainability
Advocates for higher wages in Bangladesh
Improves plants and working conditions of their distributors' employees in collaboration with the UN Convention on the Rights of the Child and the International Labor Organization
Is the world's largest organic cotton buyer and a member of the Better Cotton Initiative
Is the 1st fashion company to organize a clothing collection in order to recycle the textiles
Helped suppliers saving 450 millions liters of water in 2012
Engaged to eliminate the use of harmful chemicals waste in the manufacturing of their products
Contributes to several projects with NGOs and charities
WaterAid's work - WWF - UNICEF - Transparency International Sweden - AIDS
Headquarter : Stockholm
CEO : Karl-Johan Persson
Industry : retail
Products : clothing and accessories
Brands : H&M, COS, Weekday, Cheap Monday, Monki, & Other Stories, H&M Home

Sales : $ 18.13 billions
Profit : $ 2.53 billions

# 42 World's Most Powerful Brands (Forbes)

Incentive Program (the proceeds of H&M's Foundation)
Collective bargaining agreements
Discounts worldwide in H&M stores
Global diversity policy and an anti-discrimination policy
e-learning and classroom sessions
Internal job rotation and international opportunities
Annual evaluation and salary review
Code of Conduct
No forced child labor
Decent working conditions
Building Safety
Suppliers must avoid accidents and provide first aid
All employees must be treated with respect
Freedom of association
No discrimination
Just and Favourable remuneration
Working hours must not exceed 48 hours a week
The housing provided to the employees must be clean and safe
Karl Johan Persson, Managing Director and CEO
Strong personal commitment to developing the sustainability in H&M's business processes (social-environmental and economic)
Stefan Persson, Chairman, Karl Johan's father and ex-CEO
Strong commitment towards sustainability
Customers
Women below 50
Two-persons households
Young educated families
Economic
Value
Sustainability
Shared Value
Optimized
value chain
SWOT ANALYSIS
Strenghts
Widespread geographic presence
Sustainability initiatives
Strong brand image
Improved market position in the clothing segment
Keep prices low by using efficient logistics
Wide range of clothes offered renewed on a regular basis
Very responsive to the changes in fashion
Low delivery time
Guests designers

Weaknesses
Excessive dependence on third party vendors for supply merchandise
Risk of overstocking
Low control on the production processes
Low quality clothing
No innovative design; copy of what has been done

Opportunities
Growing preference to shop online
Expanding Presence in key growth markets of Asia
Growth in global apparel, accessories and luxury goods market
Well positioned to tap the niche apparel market
Emerging markets

Threats
Rising labor costs around the globe, including China
Risk of foreign exchange fluctuation
Customers spend more and more on luxury goods
Unemployment due to the finacial crisis is pressurizing their target segment to discretionary spending

Generally, the items with very short lead times are manufactured in Europe, with longer-lead items manufactured in Asia. Like Zara, this allows H&M to be more responsive to trends
Auteur inconnu. « Zara et H&M: Deux modèles qui tentent de rapprocher le luxe de la grande consommation », [En ligne], année inconnue, http://www.cogefilog.com/pdf/ZARA&HM.pdf (Page consultée le 8 octobre 2013).

BERNSTEIN RESEARCH. « Supply Chain, Inventory Management, Cash - Alternative Business Model », Business Source Complete- 2013, Inditex and H&M: Very different and very similar. p. 91-126.

CRUZ, Julie. « H&M, a Master of Cheap Fashion, Moves Upscale », Business Source Complete -2013, no 88364625. Bloomberg Businessweek, no 4327, 29 avril 2013, p.22-23.

EDELSON, Sharon. « H&M Goes Sustainable With Garden Collection. », Business Source Complete -2013, no 48388004. Women’s Wear Daily, vol. 199, no 43, 26 février 2010, p.4.

GIERTZ-MARTENSON, Ingrid. « H&M – documenting the story of one of the world's largest fashion retailers. », Business Source Complete -2013, no 72338805. Business History, vol. 54 no 1, février 2012, p.108-115.

GÖRANSSON, Susanne, JÖNSON, Angelica, PERSSON, Michaela. « Extreme Business-Models in the Clothing Industry - A Case Study of H&M and Zara », [En ligne], décembre 2007, http://hkr.diva-portal.org/smash/get/diva2:230949/FULLTEXT01.pdf (Page consultée le 8 octobre 2013).

H&M. « H&M ANNUAL REPORT 2012 », [En ligne], 2012, http://about.hm.com/content/dam/hm/about/documents/en/Annual%20Report/Annual-Report-2012_en.pdf (Page consultée le 8 octobre 2013).

H&M. « A Message From Our CEO - An Interview With Karl-Johan Persson, CEO », [En ligne], 2012, http://about.hm.com/AboutSection/en/About/Sustainability/HMConscious/CEO-Message.html (Page consultée le 13 octobre 2013).

H&M. «Code of Conduct », [En ligne], http://about.hm.com/content/dam/hm/about/documents/en/CSR/codeofconduct/Code%20of%20Conduct_en.pdf (Page consultée le 13 octobre 2013).

H&M. « Conscious Actions - Sustainability Report 2012 », [En Ligne], http://about.hm.com/content/dam/hm/about/documents/masterlanguage/CSR/reports/Conscious%20Actions%20Sustainability%20Report%202012.pdf (Page consult.e le 15 octobre 2013).

H&M. « Customer Service », [En ligne], https://www.hm.com/ca/customer-service (Page consultée le 14 octobre 2013).

H&M. « Échanges et remboursements », [En ligne], https://www.hm.com/ca/fr/customer-service/payments-and-returns (Page consultée le 14 octobre 2013).

H&M. « Supply Chain Data 2011 », [En ligne], http://about.hm.com/content/dam/hm/about/documents/en/CSR/reports/Supply%20Chain%20Data%202011_en.pdf (page consultée le 15 octobre 2013).

H&M. « Yout Benefits - Of course there are benefits! », [En ligne], http://career.hm.com/content/hmcareer/en_ca/workingathm/get-to-know-us/benefits.html (Page consultée le 14 octobre 2013).

HELFFERICH, Evert, HINFELAAR, Marjolein. « Hennes&Mauritz: Swedish Fast Fashion », Business Source Complete -2013, no 5878126. European Retail Digest, no 24, décembre 1999, p.35-37.

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