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Transcript of Zara Case
What is Control?
Two successful factors
Does control matter in a company such as Zara? Why?
History of Zara
Foundation of ZARA
ZARA opened 6 stores in Spain
The first international store is opened in Porto, Portugal
ZARA opened a store in New York and Paris
ZARA has stores all over Europe, Asia and America
At this time, ZARA has over 1,900 stores, cities across 87 countries
is the process of monitoring activities to ensure that results are in line with plan, and acting to correct significant deviations.
Stages of control:
Setting objectives and activities;
Comparing with standards;
Acting to correct deviations and change objectives;
Choosing control measures reflects the manager’s theory
The most important model in this domain is
Zara is committed to satisfying the desires of our customers.
"We promise to provide new designs made from quality materials that are affordable”.
“Through Zara’s business model, we aim to contribute to the sustainable development of society and that of the environment with which we interacts”
Kaplan and Norton (1992) noted that while traditional financial performance measures worked well for industrial era, they are out of step with the skills and competencies companies are trying to master today.
This has a set of measures that gives managers a fast but a comprehensive view of the business.
Zara claims to move with society, dressing the ideas, trends and tastes that society itself creates.
- They can provide new products only in 2 weeks
- Flexible and fast in adapting to the market
Its model is characterized by continuous product renovation.
a) Zara's creative team is made up of over 200 professionals.
b) Designers and customers are inextricably linked to feedback on the decisions
c) The firm encourages a collegial atmosphere
d) The vertical integration of activities;
[ As management systems ]
[As manufacturing processes]
a) Making decisions faster with getter information
b) Running design and production processes concurrently
c) Holding stocks of fabric that can be used in several lines
d) Distributing products more efficiently
e) Zara designs all its products in-house
ex. Customs, languages, punctuality, etc...
One of the largest international fashion companies
Cláudia pereira, Susumu hatakeyama, Yeongsil kim, Giacomo mancinelli
Balanced Scorecard fits for Zara because it focuses on its key strategic factor.
Learning & Growth perspective:
according to a strategy based on a continuous product renovation and on a continuous adapting to the market, it's necessary for workers to be constantly in a learning mode.
Find ispiration from many sources (discotheques, catwalks, magazines...).
Improve its in-store customer experience through employee trainings and direct communication with the consumers.
Indicators could be: revenue per employee, % of staff multi-skilled.
What do you consider most important
control issues in a multinational?
l. The creative ability
2. The operational capability
vision & mission
exceed customer's expectations
focus on the customer, listen to what the customers have to say, obtain their comments and feedbacks, and then use those information to evaluate the next production. Consequently, the results will be gratifying for the consumers.
Measure: customer loyalty, customer satisfaction and customer retention
Internal process perspective:
Increase efficiency and productivity in order to offer a good quality product at a low price.
Internal production should focus on products with the highest "trend risk".
Standardization of the offer mixed with relevant integrations of the offer.
Measure could be new products sales, cycle time.
Maximize shareholder's value.
Measure: sales volume, ROE, ROI, cash flow.