Strategic Operation Management

Zara has three major product lines, for men, women and children. It has a creative team consisting of sourcing specialist, designers and personnel for product development. The creative team of the company work on products for the current season and they are also engaged in selecting product mix and fabric for the products. Two basic collections are prepared by Zara every year that are the winter/fall collection and the summer/spring collection. The designers of Zara showcase their designs in renowned fashion programs and shows too (Zhelyazkov, n. d.). There is enormous workload of 1000 new design and fashion every month, which is managed by development and design team of 200 employees in Zara. All these employees work from their headquarters that is Spain. This signifies that every individual produces 60 different styles per year, which means approximately 2 styles in every week. This speed is maintained at every stage of product development, which catalyses the retail sales by 200,000 – 300,000 in a year. Though this process followed by the company is certainly not cost-efficient, but it is compensated through the high margin on the product (Dutta, 2003). The unique selling proposition (USP) of Zara is that it can take its designs from drawing board to the retail stores around the world in a span of just two weeks. The designs are initially sketched and dedicated through the Computer-aided (CAD) system, with the help of which samples are made by the skilled workers who are working within the design facility (Ferdows, 2003). All the sewing operations take place in the factories owned by the company. The product development structure stated in Figure 1 below is helpful in understanding the product designing and development or production process (Zhelyazkov, n. d.). Figure 1: Product Development Source: (Slack and Lewis, 2002, p. 247) Product development process involves input of operations resource, which includes developing capabilities and rapid change in technology. Moreover, considering the market requirements also play significant role in this process, this is what Zara actively does (Slack and Lewis, 2002). The product development phase beings with market research. This is combined with visiting universities campus and other venues such as discos for observing the fashion trend of the young leaders, sales reports and daily feedbacks (Dutta, 2002). Apart from this, significant investment in information technology and different communication infrastructure has been availed by the company for gathering information on customer demand. The sales managers and associates have customised handheld computers for informing the headquarters regarding daily sales report on real-time basis. The garment styling starts as soon as the designing team receive calls from stores regarding the needs and the team forecast the future demands with the help of these calls. The commercial manager sits with the designers to forecast design demand, fabric, cost and selling price (Dutta, 2002). Resource and Process implications In this section the sources and the processes would be discussed. The fabrics required in the company and other inputs are purchased from external suppliers. There are purchasing offices of Zara in Hong Kong and Barcelona. Apart from this, there are also sourcing personals in Spain, but Europe has been always the top

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