Zara: It for Fast Fashion
- Submitted by: shruti15
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- Date Submitted: 02/22/2011 12:54 AM
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Points of Discussion in the Case
Zara’s super responsive supply chain is highly dependent on its IT infrastructure. This infrastructure helps Zara support its key functions of production, ordering and maintenance of inventories. The key decision that the management has to take is to decide whether to upgrade their existing IT infrastructure. This decision requires them to make a call on the following issues:
• Upgrade to a modern operating system—the current operating system runs on DOS which is now not supported by Microsoft.
• Enhance the POS application- Add new features like checking inventory balances
• Building Networks within and between stores
• Wireless networks
Challenges, Risks associated with going forward with the up gradation
• Risk of a using a new Technology - DOS operating system and the POS application had worked very well for them over the years. There was a high amount of risk involved in moving from this stable, effective combination to a new OS which could in effect complicate the existing system.
• Complicate the Existing System -There was no need for a separate IT maintenance team due to the simplicity of the technologies used. The store managers could easily install these applications on their own. Moving to a high technology system would also need the store managers and the other existing technology users to be trained on the new system.
Risks -- if they don’t go ahead with the up gradation
• Dependence on an obsolete technology (DOS) -They are the only users of DOS in the market. The vendor can withdraw supporting the system any time and leave them in a difficult situation totally unprepared.
• Lost opportunity -Not upgrading the infrastructure would also mean let going off the opportunity to improve them. The newer available upgrades will allow them to improve their operations by linking together various Zara’s stores so that inventory can be transferred from one store to another, Connecting POS terminals within the stores...
Zara’s super responsive supply chain is highly dependent on its IT infrastructure. This infrastructure helps Zara support its key functions of production, ordering and maintenance of inventories. The key decision that the management has to take is to decide whether to upgrade their existing IT infrastructure. This decision requires them to make a call on the following issues:
• Upgrade to a modern operating system—the current operating system runs on DOS which is now not supported by Microsoft.
• Enhance the POS application- Add new features like checking inventory balances
• Building Networks within and between stores
• Wireless networks
Challenges, Risks associated with going forward with the up gradation
• Risk of a using a new Technology - DOS operating system and the POS application had worked very well for them over the years. There was a high amount of risk involved in moving from this stable, effective combination to a new OS which could in effect complicate the existing system.
• Complicate the Existing System -There was no need for a separate IT maintenance team due to the simplicity of the technologies used. The store managers could easily install these applications on their own. Moving to a high technology system would also need the store managers and the other existing technology users to be trained on the new system.
Risks -- if they don’t go ahead with the up gradation
• Dependence on an obsolete technology (DOS) -They are the only users of DOS in the market. The vendor can withdraw supporting the system any time and leave them in a difficult situation totally unprepared.
• Lost opportunity -Not upgrading the infrastructure would also mean let going off the opportunity to improve them. The newer available upgrades will allow them to improve their operations by linking together various Zara’s stores so that inventory can be transferred from one store to another, Connecting POS terminals within the stores...