Effectiveness ofZara’s Current Supply Chain Case Solution & Answer

Effectiveness of Zara’s Current Supply Chain Case Solution

In addition to this, there is better utility of the factory as the newly arm tags for new merchandise are now attached at the factory instead of in stores, as a result leaving more time for store employees.

A recent shift towards automatic replacement of basic products, which make up 10% to 15% of the product line suggests that Zara’s supply chain offers flexibility to introduce an ERP system for inventory management.

Zara’s supply chain management empowers the section managers and store employees to take decisions independently and this show show job enlargement has been introduced for increasing motivational levels of employees. This system cannot entirely be labeled as an ineffective supply chain management system as it has contributed to differentiation in their stock management system.

Evaluation of Zara’s current stores

The current in-store logistics and management for Zara’s stores have been critically analyzed below.

Inconsistency in merchandising: Although the stores are in prime locations and a lot of emphasis is given to attractive interiors and presentation in stores, however there is still a certain degree of inconsistency in shop layouts and displays. Firstly, the shops vary in size and layout which in any case would lead to a certain degree of difference in merchandising. Additionally, the ineffectiveness of the current stock management system leads to different products available in stores, which further leads to differences in window display. The headquarters allow section managers a slight level of empowerment in deciding on window displays yet they have to follow a circulated picture and match items to it. Although the aim is brand consistency however, with differences in merchandise it is not entirely achieved. This centralized system of managing window displays can be seen as a wastage of time and energyas there is an exchange of pictures for acceptable displays.

Overloaded section managers: The current store management has put extensive workload on the section managers who do not even have an office or chair and have to spend their entire time on the shop floor. While some are specialized in management or HR, their job includes managing different areas on the floor including marketing through displays, placing orders, customer services and employee management.

Too much focus on sales: There seems to be a great focus on sales rather than on customer services or complaint management. Zara does not even have a system for tracking measures of customer service. The focus is on quick service delivery which means that the emphasis on product management rather than on customer services.

Inconsistency in personnel management: While this approach has not prevented Zara from having experienced and committed store employees, the current system also shows inconsistency in employee management.

Although Zara has a low employee turnover, however there is inconsistency in the employee turnover across different countries with the larger cities experiencing greater employee turnover. This suggests that HR practices being followed across regions may not be feasible for all.

Although promotions are done internally and it is not uncommon for the part-time employees to become full timers, however thereis still a degree of wage differentials given the fact that in mature areas the part-time employees do not get opportunities for this kind of promotion.Inconsistency can also be seen across labor laws in different regions and Zara has to abide by these differences as well since itoperates in different regions.

Labor-intensive store operations: The current in-store operations are rather labor intensive where the in-store employees even have to deal with the sorting of selves since the merchandise is not separated beforehand in the factory. On the other hand,this makes the process more labor intensive, however there is another drawback to this as it leads to the workload of the employees leaving them with no time to check what comes into the store…………..

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