Zara Practices

Q. How can systems concept and the notion of contingency thinking explain the success of some of Zara's distinctive practices? Zara succeeded in matching management practices with different situational demands. They reached success through subsystems such as marketing and sales systems. They also interacted with their environment and transformed resource inputs (suppliers) into output (customers). They also kept complex systems for time production and inventory reporting. One of the biggest reasons for the success of Zara International, is their ability to implement classical management approaches. High specialization of labor is key in regards to Zara's business plan. For example, they have 200 professionals specifically looking out for the latest trends, which helps them provide these trends within 24 hours. They also try to achieve profit maximization which is evident by their low budget on marketing as opposed to other competitive retailers. Three main classical management approaches are seen through Taylor, and Weber's theories. Taylor's emphasis on efficiency is provided by Zara's ability to be up to date on the newest fashion within two days as well as re-stocking stores as soon as possible. Inditex's ability to control the supply chain to maximum efficiency also helps Zara. Weber believed the best way for management to prosper is through a bureaucratic organization. This would develop a well defined hierarchy, division of labor and specialization, rules, competence, interpersonal relationships, and records. Operations management can be seen in practice at Zara. Their ability to be efficient and meet customer's needs as soon as possible is a great sign of operations management. The distribution centers can have the latest items in store within 24-48 hours. Customers are happy because they can have the newest looks in a matter of a few days. Customers can also expect new items on a weekly basis because