Strategic Analysis of ZARA Essay Example | Topics and Well Written Essays - 3000 words

Strategic Analysis of ZARA - Essay Example Per se, Zara has many risks imposed by such factors as rival promotional competence, the ability of consumers to dictate pricing among retailers, and even responsiveness (or lack thereof) of suppliers that are critical to meeting the two week lead time from design to delivery. The report identified that Zara requires acknowledgement of market forces that can potentially impede brand sustainment and growth in sales. These forces include ongoing negative publicity for allegations of unethical business practices, the competence of competitive rivalry especially related to marketing philosophies of rivals, and even macro-economic issues related to foreign currency exchanges. All of these factors influence Zara’s strategic position and direction. Findings indicate recommendations that include more proactive efforts at promoting corporate social responsibility, changing trading currency from the Euro to the American dollar, conducting more market research studies on consumer target groups, and working to build an internal culture focused on ethical behaviour. These recommendations will assist Zara in sustaining a positive brand reputation and building equity that can translate into future revenue gains through diversification efforts. CONTENTS 1.0 Introduction......................................................................................... 2.0 Competitive forces and industry audit............................................. 2.1 PESTLE Analysis..................................................................... 3.0 An internal strategic audit.................................................................. 4.0 Public relations crises at Zara........................................................... 5.0 Recommendations for improving future business position........... 6.0 Conclusion........................................................................................... References 1.0 Introduction Zara is a leader in providing what is referred to a s fast fashion products in the retail environment. Fast fashion is defined as the ability of the company to rapidly replenish inventories in the sales environment in a lead time of two weeks or less. Accomplishment of this strategy entails aligning all elements of the value chain that are necessary to achieve competitive advantage. This report highlights Zara’s industry environment, the competitive pressures and threats of the firm’s operating environment, and proposes recommendations for future business improvement. 2.0 Competitive forces and industry audit The retail industry in most developed countries is very saturated, meaning that international markets are inundated with a variety of retail competitors. Zara is currently most impacted by competitive forces from H&M, The Gap and Benetton, which are competitors that offer similar fashion products at reasonably similar pricing structures. Because of this saturation and presence of like rivals, Zara must be ever-awar e of the changing market forces that have the ability to improve business position or severely hinder its performance and profitability. Porter (2011) describes five forces that impact whether or not a business can adapt or find positive market position in its operating markets. These include threat of substitutes, buyer power, supplier power, rivalry between competitors, and the risk of new market entrants by competing retail organisations. All of these forces influence business strategy development as well as responsiveness of Zara in attempting to outperform competitors. Zara faces very little in its sales markets in relation to substitutes. Substitutes are defined as replacement products that can serve as surrogate products for consumers. In the fashion industry, except for like products

What Makes a Good Team Essay Example | Topics and Well Written Essays - 750 words

What Makes a Good Team - Essay Example Mergers and acquisitions of organizations pose significant restructuring and leadership challenges. As the Head of Department of recently merged organizational groups, I would expect repercussions that seriously impact team cohesiveness. In fact, mergers often become the breeding ground, where shared vision, beliefs and values, can undergo dramatic upheavals. This can trap the newly formed teams in a storming phase. The team members may begin questioning the way the combined firm would look, act and feel; it may not resemble the firm they've cherished, the one they helped build (Taylor, 2002). This can hurt the team morale. It's also true, that virtually in all cases of organizational mergers described in literature, there has been conflict that affect one, or a few associates in a significant way, to the point that it may be in their interest to leave the organization. Facing the Challenge As the Head of Department, I need to realize that the team must coalesce seamlessly for a common vision and purpose. I also need to appreciate that the team cohesion is a function of task, and social cohesion. Establishing a shared commitment and organizational goals; along with a positive bond amongst team members, requires clear and honest communication. The stages for team development described by Blanchard, and adapted effectively in the Toyota (Licker, 2004), provides a simple framework that could be useful in the current situation:- 1. Orientation: Provide the group a strong direction, clarity in mission, rules of engagement, and tools that team members may use. 2. Dissatisfaction: The team members continue to need direction (structure) and also social support to overcome social dynamics that may result into dissatisfaction. 3. Integration: The group obtains clarity of roles amongst team members and begins to exert control over the team processes. The challenge is for the group to learn about roles, goals, norms and team structure. 4. Production: The group performs effectively with little task or social support. The alternative team development model is that of, Forming, Storming, Norming, and Performing as proposed by Bruce Tuckman in 1965. The Plan I would address this situation with a three phase focused plan viz., initiation, development, and production. 1. Initiation: Breaking the ice with a weekend workshop in formal and informal settings. The workshop would provide opportunities for the group to mix with each other; work in small groups to discuss, deliberate and recognize the strengths of the group; interact amongst the groups to understand and deliberate on goals and mission; highlight the weak spots of apprehension and brainstorm to find ways of overcoming them; share the best practices of their respective parent units; and above all, have fun with