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Background
Strategic
Management
Process
Strategies
Discussion
Questions
Background
Background
Founder: Amancio Ortega
To tackle the outdated clothing industry which take long time manufac
turing before sale.
Having more style than Gap
Faster growth than Target
Logistical expertise rivaling Walmarts
Background
Background
Step 1
Step1: Identifying the Organizations Current Mission, Goals, and
Strategies.
Mission: Fast Fashion
Goals: Getting designs to customers quickly
Strategies:
- Not creating, but following the trend
- Limited merchandise
- Locations
- Time compressing
- Vertical integration
Step 2
Step2: Doing an External Analysis.
Opportunities
Threats
- Trendy designs
- Worldwide branches
- Many competitors
- Not so cheap
Step 3
Step3: Doing an Internal Analysis.
Strengths
- Many designers, short
duration
- Customers first
- Limited merchandise, stock
controlling
Hunger marketing
- Expert in vertical integration
- Make good use of IT system
Weakness
- Short life cycle of
merchandises
- Cannot satisfy the luxury
consumers
- High repeatability with
other brands
- Tort claims
Marc Jacobs
ZARA
Valentino
Burberry
ZARA
ZARA
Step 4
Step4: Formulating Strategies
- Design to store floor in two weeks
- Stock new designs twice a week
- Each segment works closely and efficiently
Fast turnaround
Step 5
Step5: Implementing Strategies
- Produce most of designs close to home
- Quality check
- Shipping by planes
- Feedback system
Step 6
Step6: Evaluating Results
- More than 5,618 stores in 84 countries
- Pulls more than 60 percent of the companys revenues
- Competitors are working to be faster
Strategies
Strategies
Corporate Strategy
Growth
Stability
Renewal
Strategies
Competitive Strategy
Strategies
Competitive Strategy
Five forces models:
1. Threat of new entrants.
Low
2. Threat of substitutes.
Moderate
3. Bargaining power of buyers. Moderate
4. Bargaining power of suppliers. Low
5. Current rivalry.
High
Strategies
Competitive Strategy
Three generic competitive strategies:
a cost leadership strategy.
differentiation strategy.
focus strategy.
In this case:
Competitive advantages: Fast-Fashion, customer responsiveness, a
nd business operation .
Competitive strategies: Differentiation strategy.
Strategies
Functional Strategies
New methods enable manager to order and display mercha
ndise faster.
New cargo routes for shipping goods.
Jump into online retailing.
Discussion Questions
Discussion Questions
1. How is strategic management illustrated by this case
story?
Discussion Questions
Discussion Questions
2. How might SWOT analysis be helpful to Inditex exec
utives? To Zara store managers?
Discussion Questions
Discussion Questions
3. What competitive advantage do you think Zara is pur
suing? How does it exploit that competitive advantage?
Discussion Questions
Discussion Questions
4. Do you think Zaras success is due to external factors
or both? Explain.
Discussion Questions
Discussion Questions
5. What strategic implications does Zaras move into onl
ine retailing have?
(Hint: Think in terms of resources and capabilities.)