Raymart E.

Merabedes

9-14. 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.

9-15. 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.

9-16. What competitive advantage do you think Zara is pursuing? How does it exploit that

competitive advantage?

The competitive advantage Zara is pursuing is lower prices than his competitors with better

speed and flexibility in getting the product to market. This is an advantage over gained over

competitors by offering consumers greater value, by means of lower prices and cutting age fashion.

9-17. Do you think Zara’s success is due to external or internal factors or both?

The success of Zara is due to the both, internal and external factors. The important external

factors which have helped Zara to grow are a strong external brand image that Zara has among the

cons. And in the internal factors the staff’s ability to be so efficient that they can go from design

to storefront in only two weeks is huge. Zara’s employees are able to scrutinize sales and get almost

instant feedback regarding which items are and aren’t selling, and adjust accordingly.

9-18. What strategic implications does Zara’s move into online retailing have? (Hint: think in terms

of resources and capabilities).

A company with customer-focused strategic objectives will have a corporate strategy that

impacts its marketing. When a corporation can envision and project the long-term profit

implications of a customer, it can modify its strategy to capture as much of that customer's lifetime

value as possible. Projections are growth quadrupling in very large part to the addition of the online

marketplace.