Applied Corporate Strategy Assignment : Zara
Added on 2021-02-19
13 Pages4362 Words68 Views
Applied CorporateStrategy
Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1PESTLE Analysis and Porter's Five Forces Model................................................................1VRIO Analysis and SWOT Analysis.....................................................................................4SAFe Criteria, Porter Generic Model and Strategic Clock....................................................7CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONCorporate Strategy can be defined as the overall scope and direction of a corporation andthe way in which its business operations work together in order to achieve the goals andobjectives of an organisation. The company chosen for the completion of this assignment isZARA which was founded in the year 1975 and is headquartered in Arteixo. The company isserving worldwide and provides various products to their customers such as clothing. ZARA haschosen the online strategy to make the promotion of their brands and products and theorganisation is dealing in the fashion retail industry. The organisation went online in 2010. Theassignment will start with covering PESTLE Analysis, Porter's Analysis, VRIO Analysis, PorterGeneric Model, SWOT Analysis, TOWS Analysis and SAFe Criteria.MAIN BODYPESTLE Analysis and Porter's Five Forces ModelPESTLE Analysis:The following analysis is used in order to know about the impacts of externalenvironment on the working of an organisation. The application of this analysis on ZARA hasbeen provided as under:Political Factors: These are those factors that impacts due to change in governmental policies,rules and regulations and many other. Looking on the political factor that is both an opportunityand threat to ZARA is the political stability (Chatterji and et. al., 2016).Opportunity: Political Stability creates an opportunity for ZARA as it helps in long termpolicies formulation and implement long term plans in the working of ZARA. As with the helpof formation good policies and strategies, it will be possible for the organisation to have goocontrol over the market and maintain the profitability and productivity level of the company. Sothis factors is considered as an opportunity for the organisation. Economical Factors: These are those factors that impacts upon the working due to change in theinterest rates, inflation, deflation, disposable incomes of customers and many more. The worldhas recently passes through the web of low economic activity and ZARA has its strategy ofaffordable pricing.1
Opportunity: This strategy could help the business in increasing the market base as it isproviding good quality products at low prices.With the help of this opportunity, it will bepossible for the company to retain their current customers and also to attract new and potentialcustomers of the market with the relatively lower prices as compared to competitors and goodfrom the quality perspective. So this factor is also considered as an opportunity for the company. Social Factors: These are those factors that impacts upon the working of an organisation due tochange in perception, taste and preferences of people. Continuous change in the needs anddemands of customers is an issues faced by the company that impacts upon it in two ways.Threat: The taste and preferences of people changes very rapidly so it is possible thatinappropriate analysing the market could impact negatively on ZARA. Proper time for knowingthe needs of people will reduce threat.So due to the rapid changes in the needs and demands ofcustomers, it will impact negatively on the working of the company as due to this change willimpact negatively on the working and profit of the organisation. In this way, the following factorhas been considered as threat for the company. Technological Factors: These are those factors that impacts upon the working of an organisationdue to improvement in the ways of working, ways of operations, ways of producing goods andservices and many more. The issue is related to the ongoing technological advancements thatcould impact on ZARA. Opportunity: Customer satisfaction could ensure the success of an organisation as forincreasing customer satisfaction, the use of Radio Frequency Identification Technology (RFID)has been done and this creates opportunity for ZARA to focus more on innovative technology tosustain in the market (Doda and et. al., 2016).With the help of this technology, it will bepossible for the company to make new innovations in their products and services with the help ofwhich it will be possible to increase their sales and profit. This is an opportunity for the companyto have positive impact of this factor on the working of an organisation.Legal Factors: These are those factors that impacts due to some special rules and laws made bythe government. The issue is related to the copying of the products of ZARA that are donemainly in the local markets. Threat: It is related to the local markets to which the reach of company is not much and theycopy the products and sales and profit of ZARA are impacted. Increased focus of the companycould prevent from loss. There are many issues related to the bad impact to ZARA from the local2
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