Zara
Key Issues
Stakeholders
Solve
Timeline
Solution
To update the POS or not to update the POS
No optimal production plan creation in factories
Employees can not see store inventory
Employees can not see other stores' inventory
Employees have to manually count garments to make orders to distribution
POS does not assist store managers with decision making
Microsoft no longer supports DOS
Updating could cause problems with the POS
Those who help maintain the POS would have to relearn the update POS system to supply help when issues arise
Makes production to stores slower
Zara focuses on speed of production based on new trends
Takes more time to get an inventory count
Errors in the count could throw off the theoretical store inventory
Causes making orders to take longer
Assisting customers with finding clothes is harder because employees don't know if they have something in stock
Store-to-Store transferring becomes very difficult
Employees have to call other stores and ask them if they have items in stock
Wastes items and money because stores could be low on an item and order more, but another store is struggling selling that item and could transfer it to them
Obsolete operating system (DOS)
POS system does not offer tools for store managers
Store managers have the freedom to decide what clothes to sell
Without tools to assist them, they can not make educated decisions
Xan Salgado Badas
Bruno Sanchez Ocamp
Zara (Company focused in case study)
Inditex (Holding company for Zara)
Store managers
Store Employees
Distribution centers
Commercial groups (designers and product managers)
La Coruna (Fulfillment center)
Update POS OS system to an OS currently supported
POS hardware vendor currently supports the POS with a DOS, but could change this in the future
Claims they have no plans to make support changes, but this is not in writing
If they choose not to support DOS systems, the POS system at Zara could become unusable. This would be devastating for the company,
Design this POS inhouse
Provide tools to help store managers make decisions
Ensure that the POS keeps track of inventory levels
Provide automation tools that automatically orders from La Coruna when supply is low
Update distribution factory system to create optimized production plans
Speed is the primary focus of Zara, so optimizing production plans are a must if they are to keep up with changing trend demands
Began selling online
Since a website is already establish, change this website so that it is capable of selling products
Use new POS and integrate it into the website
Since Zara focuses on trends and not classic clothes, it would be easier for customers to check for new clothes online than to make frequent trips to the store
New POS system can help with distributions problems associated with online sales
Design POS to support online sales
Update the PDAs (employee's handheld devices) with larger screens, keyboards, and mouses.
Employees claim that the PDAs are hard to use with small screens and styluses
Ensure the POS system interconnects with all other stores so that store managers can see inventory levels at other stores
Jose Maria Castellano Rios (Zara CEO)
What could have been done differently?
What needs to change?
Zara could have listened to their store managers requests and provided them with the tools they need to make their decisions
Zara could have updated their POS to a new OS as soon as DOS became unsupported by Microsoft and they opened more stores.
The POS system needs to be updated
The Distribution centers should change their systems to create optimal production plans
The PDAs should be updated to supports a larger screen, a keyboard, and a mouse
Zara should have not decided to strictly sell in-store and not online. They are missing a large opportunity by not doing so.
First Zara store: 1975
Inditex forms as a holding company for Zara: 1985
Jose Maria Castellano Rios joins the company: 1985
PDAs (Apple Newton) are introduced to store employees: 1995
Jose Maria Castellano Rios becomes CEO: 1997
Zara switches PDA manufacture: 1998
DOS is no longer supported by Microsoft: 2003