1. How is strategic management illustrated by this case story?
Strategic management involves all basic management functions like planning, organizing, leading, controlling, and all of these areas are illustrated by this case story. Strategic management is illustrated in this case story when Mr. Ortega opened his first Zara clothing store and the business model of the company was to “sell high-fashion look-alikes to price-conscious Europeans. Strategic management is illustrated in this case story when Zara clothing store planned to do “fast fashion” which means getting designs to customers quickly. Strategic management is when Zara’s employees look at the computers to scrutinize sales at every store. In this way they can see what is being sold at every store and they are able to produce more of the popular items.
Strategic management was illustrated by this case when Zara produced most of its clothing close to home where they are being sold
2. How might SWOT analysis be helpful to Inditex executives? To Zara store managers? Zara is owned by the Spanish fashion retail group Inditex SA. They recognizes that success in the fashion world is based on a simple rule which is getting products to market quickly which involves a clear and focused understanding of fashion, the ability to adapt quickly to trends, technology, and their market. SWOT analysis is helpful to all businesses, Inditex executives, and Zara store managers because it is an analysis of the company’s strengths, weaknesses, opportunities and treats. By doing a SWOT analysis the Inditex executives can study the opportunities for the company to grow and expand. They can also study about the threats to the company like negative trends in the external environment. An internal analysis strengths of Zara is that stores are stocked with new designs twice a week which is very quickly because clothes are shipped directly to the stores from the factor approximately two week as they get a new design from drawing board to store floor. The SWOT analysis can be helpful Inditex executives can analysis from an internal analysis the strength of the organization which is the fast turnarounds and weaknesses
3. What competitive advantage do you think Zara is pursuing? How does it exploit that competitive advantage?
A competitive advantage is what sets company apart from all others. For Zara, the competitive advantage is “fast fashion.” They ship directly to the stores from the factory and get the designs to the customer quickly. Zara has exploited its competitive advantage because it use to take clothing industry six months to get their designs out to the public, now it takes approximately two weeks to get a new design from the drawing board to the stores. They also exploit their competitive advantage by stocking their stores with new designs twice weekly. Each aspect of Zara’s business contributes to fast turnarounds.
4. Do you think Zara’s success is due to external or internal factors or both? Explain