Zara Fashion Company Analysis - Desklib

Running Head: ZARA FASHION COMPANY 1
Zara Fashion Company
Name
Institution Affiliation
Date

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Zara Fashion Company
Introduction
Zara is one of the largest world fashion retailer companies that was established in the year 1975
by Amancio Ortega as a small store outlet and later developed in to one of the current fashion
giants in the industry. Being the main brand of Inditex group, Zara has proved to be a success in
the industry as Inditex is the largest apparel retailer in the world with its headquarters in La
Coruna, Spain. Dealing with both men and women wear as well as kids in the fashion industry,
the company has made it possible to ensure customers satisfaction in all basis. That is, the
company has both clothing wears as well as ornaments required by both men and women, supply
of all its products are also done relating to the current trends in the fashion market where it
produces over 450 million items in every year. With a very convenient online platform where the
customers can seek clarification about Zara products and order them online (Trehan & Mehta,
2014).
Success registered by Zara Company in all the years has been driven by effective and efficient
management processes as influenced by the board of directors, following the set strategies to
enhance achievement of the set organizational goals. Operating in more than 88 countries today,
the company has over 15 billion employees whom through the various human resource
departments are motivated to ensure they carry out their duties as required. Managers are the
heads of the various stores in different locations, they control and coordinate all activities and
enhance employees relationships through effective and efficient communication processes to
ensure they remain productive and focused towards achieving the set organizational goals (Vu &
Medina, 2014). Zara fashions ensures that the customers heart is at the center of all
organizational activities from designing, process of production, distribution activities and sales

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through all the strategic retail networks. To enhance development of the company’s
organizational business, management approaches, models, frameworks and theories have been
enhanced in its various organizational processes as discussed below.
Discussion
Approaches to organization and management
Zara as one of the largest international developed fashion companies with Inditex as the major
parent company has proven to be a success by use of its unique management approach, putting
her ahead of her competitors in the fashion industry. With the idea of growing with the
developing trends in the sector, the company has ensured that its management and organizational
processes are enhanced by the needs and requirements of its customers. Designing process,
production and distribution of the company’s products through its various retail networks has
ensured that the customer’s needs are put at the center thus positioning it at a very unique
category in the industry. Contingency management approach as enhanced by Zara Company
ensures that, management activities put in place should be in line with the current situation or
circumstance relating to the set organizational goals (Anderson, et al, 2015). The level of
management success according to contingency theory depends on the manager’s ability to
control and coordinate all activities towards improving organizations business.
Board of management of the company has various roles that are meant to enhance order while
carrying out all organizational activities. With nine board of directors in place, they act as the
highest decision makers to give various supervisory directions to the junior managers with an
aim of enhancing effective management. With a mission to enhance sustainable development and
a vision to satisfy their customers, the level of organizational management has ensured that the
progress is positive and satisfying in all the 88 countries that the company is represented. Zara

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has an active online shopping platform that has been effective in coordinating their diaspora
customers by making sure their needs and requirements are taken care of. This is important to
ensuring that the organizations business is developed and maintained at the level which its
competitors cannot get them. To ensure that their customers are fully satisfied to remaining loyal,
the company’s management has enhanced a favorable purchasing cost analysis that ensures both
the company and the customer benefit fairly from the product. Labels on the products are clearly
attached to prevent any form of confusion that may arise during distribution and sales process.
Example, in the year 2007, Zara had to withdraw a certain type of handbag model from their
shelves as one of the customers noticed a swastika on the handbags design. In any case such
confusion is realized, the managing team has a role to explain its reasons and take an action if
need be to ensure that the customers are comfortable with services and products they receive.
These approaches and models of organizational management enhanced by Zara has ensured a
positive relationship with its customers making it more easier for the company to implement
developmental strategies to becoming dominant in the world of fashion.
Work motivation and satisfaction
Zara has over 15billion employees as indicated by research findings in the year 2016. To ensure
work motivation of employees and their satisfaction, the company has put in place various
factors to ensure that the employee’s needs and requirements are taken care of. All employees
understand their various duties as they are well trained making it easier for them to deal with the
customers. Human resource departments within Zara Company outlets ensure that all employees’
level of productivity is enhanced and their rights respected following given ideas by theory
proponents and other elites on employee’s motivation (Arun, 2014).

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According to Maslow’s Hierarchy of needs theory, any individual’s basic needs must be met to
enhance their productivity. Zara has enhanced this theory by ensuring that their employees’ basic
needs are catered for as well as additional incentives for their motivation. Examples of these
incentives include; favorable gross salary that ensures every employee is able to cater for her or
his financial needs. Unlike in other company’s both at local and international market, Zara’s
employees make an average of $37000 yearly which is far much better than other companies.
Another incentive is discounts while buying Zara products, all employees of the company have a
privilege of getting 25% discount while buying their employers product. This shows that the
employees have a good relationship with their employer and they are willing to be part of the
company’s growth through serving and being served as well. Holiday packages is another form
of incentives that Zara employees enjoy important in motivating them to be more productive in
their line of work among others. Employee’s motivation in every company is very important as it
ensures they are motivated towards achieving the set organizational objectives, ensuring
organizations business development as well as customer’s satisfaction (Lainema, 2014).
Customers are at the heart of every activity that is enhanced in Zara Company, from designing to
production. The company ensures that customers’ tastes and preferences are put in place to make
products that only fit the customers’ requirements without fail as they are the main stakeholders.
Customers Relationship Management (CRM) is positively enhanced to ensure that they are
satisfied by the service delivery system put in place. The company has an online platform that is
controlled and managed by a well skilled employee to ensure that the customers are served in the
right manner and to their satisfaction. Zara marketing mix activities are mainly enhanced by the
company’s vision to deliver and satisfy their customer’s needs. With over 30 brands in the
fashion market, the company has ensured that all their customers receive high quality products

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and services at favorable prices to enhance customer’s satisfaction and loyalty to their chosen
brands in the fashion market (Goetsch & Davis, 2014). Developing to be one of the biggest
international fashion brands in the world has been an aim satisfied by Zara, done by opening
stores in different countries to enable them reach their customers.
Perception and communication
Perception in a business organizational setting refers to the ways in which individuals identify,
interpret, relate with and respond to any form of information within their organizational
environment. While communication refers to a process or technique used in passing information
or message to a given target person or group of people. Both perception and communication in
an organization setting work hard in hard to ensure a smooth learning of organizational activities
following a set plan or strategy to enhance achievement of the set organizational goals and
objectives. The management in every organizational business has a role of ensuring effective
communication to other employees to enhance a positive perception. To measure the impact of
the two concepts in management of Zara Company, the following factors are enhanced,
Management communication strategies and brand communication strategies relating to their
perception in the market as discussed below (Chen, 2015).
Management communication strategies in Zara Company refers to the various ways in which the
company operates. This includes the means by which the board of directors as well as the
managers operates its organizational activities towards achieving its set goals. There are two
forms of formal communication strategies used in this case, they include vertical communication
strategy and horizontal communication strategy (Chu, 2016). Horizontal strategy refers to the
means by which the management led by the company’s board of directors pass information
relevant to improving the organizations business environments among themselves, this can be

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inform of writing or discussions. While, vertical strategy refers to means by which the
management passes information to the junior employees of the company, this can be done inform
of writing or orally. This may include information about the set policies, employees’ code of
conduct, strategies or decisions by the management to ensure a smooth learning of the
company’s organizational business activities. The level of implementation of the information
given depends on the perception by the receivers of the message. Zara Company has come up
with a strategy of ensuring that the information passed to the employee is well understood by
creating employees portal where the laid information is later explained to enhance their
understanding. This ensures that managers at their respective outlets are able to offer maximum
control and coordination of all organizational activities (McQuail & Windahl, 2015).
Brand communication strategies on the other hand refers to the means by which the company
reaches both consumers of their products and the suppliers of raw materials used in production
process. It’s good to note that Zara spends nothing or just a few resources when it comes to
advertising, instead it enhances use of word of mouth and an online social media platform to
spread the word about their products (Terblanche, 2017). The first and most important thing that
Zara has effectively ensured its clear identification of its target market and the forms of
communication strategies they mainly dwell on to gather information. With the knowledge that
the company’s target market are the fashionistas’ who mainly rely on social media to know the
current trends in the fashion market, Zara has ensured a well-designed online platform to attract
and serve its customers to also enhance their positive perception on the products being sold.
When it comes to their suppliers, Zara has a well outlined code of conduct on how their suppliers
should behave and a set of expectations on what they should supply. This involves the quality of

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raw materials that they should deliver to the company and consequences of failure on the same
(Fleischmann, et al, 2014).
Nature and Context of the organization
Zara Company has a decentralized form of organizational culture where everyone within the
organization works hard towards the success of the whole organization. During designing and
production of the new products, the ideas relating to the current trends are brought on the table
discussed and critiqued in a very short period to giving out the best product in the fashion market
(Fan, Wong & Zhang, 2013). The company’s employees have a role of ensuring they work
together as they correct and accept corrections from their colleagues, share any form of credit
among themselves as well as developing ideas important in enhancing growth of the company.
This ensures a strong and productive organizational culture to enhance growth of the company’s
organizations business. To enhance employees’ level of productivity and solving any conflicts
that may arise, there are formed groups where employees join one which is convenient and
effective to ensuring they remain focused. The groups’ team members are switched after a
specific period of time to ensure they remain relevant and come up with fresh ideas, with
competition among the different teams to ensure they give feedback to their fellow team
members and remain relevant towards achieving the set objectives by each team and members.
By Zara having this kind of working structure makes it easier for the management to control and
the company to remain relevant as the employees enhance a positive and modest workplace
where they respect each other (Oliveira, 2014).
Zara functions under a structure which is lean and one that ensures high and quality
organizational performance and a reduction of the massive managerial hierarchies with
decentralized form of decision making (Tong, Tak & Wong, 2015). This is important to the

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company to ensuring that the business activities put in place enhance development through
practical management procedures. This is important to help prevent stress that may rise during
designing all the way to delivery processes if redundant procedures are put in place. Customers
need for satisfaction influence all activities during designing to delivery process to ensure that
the customer’s needs are taken care of they help shape all business decisions influenced in Zara
Company. The company enhances use of technology in all of its administrative activities to
ensure that managers of the various outlets report directly to the head office located in Spain for
easier overall control of the company’s organizational activities. Example, all managers in
charge of various stores in the 88 countries use PDAs to check the newest wears produced by the
company to help place their new orders based on the level of demands in their outlets (García-
Álvarez, 2015).
Conclusion
Zara effective management organization structure and activities has enhanced its high level of
success. With employee’s motivation enhanced, the company has registered increased employees
productivity thus beating its competitors in production in the fashion market. Currently, Zara is
facing competitive form of leadership in the fashion industry from its competitors like Amazon,
H&M, and ITV among others in the fashion market (Mo, 2015). The strategies enhanced by Zara
have been significant to ensure its market base remains strong and relevant in the fashion market.
To help deal with the increasing competition levels and the growing market base in the fashion
industry, Zara should consider changing some of its objectives and strategies to fit the current
market structure.

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