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Presented by:Anurag Iyengar

Kamal Syal

Rahul Verma

Vishwesh Samant

IT STRATEGY

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Contents

Need for IT strategy

Strategy Grid - ZARA

Strategy Alignment - ZARA

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Need for IT Strategy

IT helps to design business model for operational effectiveness

IT helps accelerate value chain process

IT Strategy in Zara With the help of IT, it becomes possible to venture into new

business areas like online retailing

To support the core business strategy Rapid response tomarket demands, decentralized decision-making, having betterinventory and better connection between stores.

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What technological changes occur

with time in Zara Till 2006, Zara hardly changed their IT infrastructure,

No major IT/IS implementation were done .

In 2006,they upgrade their DOS based Point-of-Sale(POS) system which resulted in better check andcount inventory, better information retrieving abilityand better connection between stores.

In Fall 2010, they introduced Online retailing,especially for US customers .In 2011, they introducedonline retailing at a global level. Now, they areproviding online retailing in 22 countries.

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IT strategy for Dell and Amazon Amazon or Dell has a common revenue

generating IT strategyto support their corebusiness of selling directly to Customer via

online mode, which helps rule out distributor andretailer cost in supply chain.

IT strategy of Dell and Amazon turned out to beextremely successful for them.

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Impact

onBusinessoperations

Factory

Support

Strategic

Turnaround

Change

Basis ofCompetition

LowLow High

High

-To develop online retailing

-To explore business in newemerging markets like Asia, US

- Diversification

Preference for reliable IT systems

Aversion to risk arising out of movingto a newer applications

Low cost of advertising and ITpersonnel

Critical day to day operation like

order by store support, logisticsupport, administration support,

POS & PDA

Developing internal relationship

within Zara for smooth function

of supply chain at large

Strategy Grid - ZARA

Lower

Barrier of

Entry

Decreased

SwitchingCost

Increased

Supplier

Power

Impact on strategy

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Barrier of Entry IT helped ZARA to enter into online fashion market whereother brands were already established

Supplier Power

Buyer Power

ZARA is able to manage the inventory and productionforecast through software's likePOD,POC etc.

Zara provided online design availability which furtherenhance Buyers power.

Switching costs ZARA IT strategy has maintained minimum switching coston changing fashion patters in production

Existing Product/Services

Store managers regularly update product manager &commercial team about latest trend in market which helpsthem bringing new product in short time.

Basis ofCompetition

ZARA is ahead of competitors by producing latest trend sat affordable rate, whereas other competitors push new

design in market at higher rate.

Strategy Grid ZARA ( Five forces)

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Business

S

trategy

IT

Capabilities

-To run the store system with

minimum down time-To develop in-house IT system as

per business requirement

- Self designing of

applications(Customization)

- Outdated systems and applications

- Supply chain Network

- Decentralized decision-making

- Creating a Scarcity value- Low advertising cost(Almost Nil)

-Vertical integration

- Fast and continuous communication

- Meticulous store design, layout and

location.

-PDAs and POS Systems based on

DOS. Should it be changed to

Windows?-Should investment in IT be

encourage in Zara.

Strategy Alignment - ZARA

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