SWOT and PESTEL Analysis of Zara: Leadership Style and CSR Process

This report provides a detailed analysis of Zara's SWOT and PESTEL factors, along with recommendations for suitable leadership styles and evaluation of their corporate social responsibility process. The report also includes a reflection on the skills and knowledge gained from the analysis.

Context of business

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
SWOT AND PESTEL................................................................................................................3
Change in PESTEL factor that influenced the opportunities and threats....................................5
Recommendation of Leadership style in organization................................................................5
Corporate Social Responsibilities process in Zara......................................................................6
Reflection....................................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business which is defined as an organization or enterprising the entity engaged in
industrial, commercial, or some professional activities. Business that can be having non-profit
and profits entities organization. While this report explain about the SWOT and PESTEL
analysis for the selected business along with this evaluate about how the changes in PESTEL
factor must be influenced with opportunities and threats business. As well as how the business is
being addressing their strengths to negate the threats and weakness which are affecting their
opportunities. Moreover, recommendation of suitable leadership style which help the
organization for achieving the business objective. Also, evaluate the corporate social
responsibilities of the selected organization. At last, discuss the project reflection, that help for
gaining knowledge.
MAIN BODY
SWOT AND PESTEL
SWOT a analytical tool which is used to examine the internal environment of the
business, it generally gives the identification about the company's framework, so that they will
be able to make the improvement for better result.
STRENGTH: It shows in what areas organization excels that makes them different from their
competition. For the Zara organization they are the leading fashion industry, their commitment is
to revamp their fashion collection for every two weeks, which makes them unique. Company has
the strong management strategies to run their effectual supply chain. They have the trained
designer staff who are capable of fulfilling the desire of the customer by transforming their needs
in a specific fashion design.
WEAKNESS: Weakness are those which stops the organization to achieve their goals. For Zara
there weakness is for the fast fashion they have pressure to meet the sustainability through the
fast fashion which is very challenging (Vlados and Chatzinikolaou, 2019). Also, pandemic
covid-19 limits their range of the physical stores.
OPPORTUNITY: These are the supportive external factors which gives the advantage to
businesses to rise their revenues. For Zara they are good in fast delivery cycle, they adapt the
latest things fast which give their customer varieties of option, along with the use of AI

technology which allows the company to easily analyse the data or to give real time problem
solution to the customer.
THREAT: It can majorly seen by the competitive environment of the organisation . As for the
Zara other fashion company like Shein is the biggest threat, for that company also required to
focus on their services along with products.
PESTEL
It is used to analyse the macro environment of the business.
Political: External factors are political policies, foreign trade aspects and the internal element
can be tax policies. For the Zara they are the European company so there is no border restriction
for them, EU's policies are extremely beneficial for them. Therefore there is no political threat
for company.
Economical: It involves the interest, inflation rate or other factors as unemployment,
globalisation aspect. For the Zara they have the cheap labour cost is available in their own
country, therefore they do not outsources their production so no major impact of changing in
interest or inflation rate.
Social: Societal norms, age, gender, cultural aspects are listed in this factor. As cultural reason
always impacts the industry, for Zara they always proceed to launch their product which are
designed according to the local and cultural trend. Social factor impact majorly on company's
business.
Technological: Technologies like Big data, IOT, AI are the trending technology which is
anticipating the whole market (Fosher, 2018). Zara has both money and other resources so that
they can proceed to use new technological trend for good revenues.
Environmental: Sutainablity, Eco-friendly, Carbon footprints, pollutants etc. for Zara It is
challenging for them to meet the sustainability through their products, therefore for that Zara
company is public ally committed to provide their product which meets the environmental
factors.
Legal: It involves the health and safety aspects, promotional standards, consumer rights. As for
the Zara they have laid down various legal policies for the staff and labour earnings, but for the
implementation, critics identifies various contradictions in their commitments. They also had a

copyright issues therefore it is important for them to consider all legal laws in order to avoid any
lawsuits.
Change in PESTEL factor that influenced the opportunities and threats
The changes in PESTEL factor that lead for better opportunities with having the
development from the technology and environment factor. While this such kind of factor keep
the organization for taking some better steps and also influenced the business for knowing about
the goals and objective (Abikova and Piotrowicz, 2021). The external factor that could easily
influence about the determining the long term on the performance and activities of the business,
identify more solution to the problem, evaluate the risk associated within the market and work
for having some major activities. Along with this threat from the political and economic factor
which create the fear due to Covid-19. As how the government can change their rules and
regulation for the fashion industry. As well as PESTEL factor that could keep about for working
within the influence factor and make sure for having the proper estimated about the changing
factor in organization. The internal factor analysis that looks about the affected to the business.
Strength can help for maintaining the competitive advantage and growing the business which
involves in finding the various ways for using the strengths (Şimşek and et.al., 2021).
Minimizing weaknesses this put disadvantages for business and identify more about
characteristics which try to improve them before having any problem.
Recommendation of Leadership style in organization.
Leadership in business have the capacity of company management to achieve or set the
challenges goals. According to Daniel Goleman leadership style model, in which the leaders
have ability to deal with changes in environment at workplace. The model for this reason is
being associated with the emotional intelligence for recognize the ability and understand about
the personal emotions for influenced other people. Here are some leadership styles that will help
Zara to meet their business objective:
Affiliative leader-
Affiliative leader means keeping the employee motivates by giving worker freedoms to
express their opinions, creative ideas and feelings. In this leadership styles, the leader tries to
solve the conflicts or issues within the group by attempting in making the collaboration of
teammates. In Zara, this could create team where everyone feels more valued and feels the better
part of the working team. For example, when the desired results for the team which are not

achieved because of having lack of collaboration (Voshchevska, 2021). In this leader can only do
this effectively when they understand and keep the value for emotion of others. In addition, for
working with most appropriate styles and this could keep the Zara for working with team as the
first priority and try to develop the positive relationship which lead for achieving the business
objectvie. According to author, the Zara must be preferred the affiliative leader, while through
which they can easily make their team for working with solution about any problem or conflicts.
Along with this might be more helpful in organization for working with more effective team
members and try to understand other emotion in work.
Democratic leader-
This includes about the contribution of each and every team in organization, including the
participation with every decision-making process. While having such leadership styles this act
about the high employee engagement before these styles which is being useful. In organization,
this leadership styles will helpful when the leader is being more dependent on their team
expertise. For example, an executive manager of Zara that might have the various services for
working with social media maintenance and about for having the fixed contracts that could be
easier for pay rolling (Neupane, 2021). While the organization need to prefer such kind of
leadership styles in which they can have the best proactive decisions and urgent decision that can
easily made by managing the right team work. In comparison with the affiliative leader,
democratic leader play the important role which made the best management because for having
right team which might be aware about all issues or conflicts (Fisher, 2021). Urgent decision can
become more typically which could be best by management because team might be not aware
about any necessary information and lead for influenced the decision. In having the urgent
decision which lead the Zara for achieving the business objective. This could be also seems that
in the case of dependent on team experience with having the social media performance of Zara, it
can found out better previous work with some pons and cons of collaboration with keeping
various suppliers.
Corporate Social Responsibilities process in Zara
Corporate social responsibilities is the basis management concepts whereby the
organization integrates the environment and social concerns for the business interaction and
operation with their stakeholder. Zara which is committed with sustainable development of the
society and environment which have the better interacts. As Zara initiatives which might be

including an effort for decreasing the energy consumption by 25% in their all stores and
automated recycling for their system (Zara Corporate Social Responsibility, 2020). This could
sometime lead them for working with some better processed and plastic elements from its store
and the use of ecological fabrics along with some organic cotton of products (Shabir and
AlBishri, 2021). Through having such kind of business models, Zara wants to help for having
more sustainable development of the society and bringing out the better environmental with
some proper interaction. This could also lead the commitment to the environment with Indetix
group corporate social responsibility policy. Zara plans the code of conduct with their suppliers
have to respect in order for maintaining the proper relation with the company.
The investment about the social initiative like the community development program and
ensure the organization for improving the standards of leaving people with no developed
countries. In 2004, Zara have also involved with the suppliers in child labour scandal in
Morocco. Basically, the organization keep working with the CSR through which they can easily
make their working system more effective and also make sure for having the proper estimation at
their store. Inditex sells do not involve risk to the health and safety about creating two different
audits (Jastram and Berberyan, 2021). Zara's process involves the objective and regulate the use
of substances that could be present in the products, could be harmful in the health of the
customer. Safe to wear- a methodology, that could prevent about the inditex from presenting
problem and physical safety of customer. For example, small pieces for child, sharp edges, cords
of shoes and so on.
The company which usually follow up the CSR concepts and try to invest more through
which can easily make their more customer and bringing out more effective growth. In having
the corporate social responsibilities this could lead them for working with some better estimated
and try to make their investment towards more CSR activities in the future (Luz, Wreaves and
Paschoalotto, 2021). While having the business model in Zara, that help sustainable development
in the society and environment that could work to interact and keep organization growth. Along
with this such kind of commitment to environment which is the part of inditex group corporate
social responsibility policy. This seems that the costs which includes to switch the brands with
environment friendly and high quality material disposal process with having the benefits and
staying ahead in health care reform on impacts of legislation due to environment policy.

Reflection
As I have experienced about many things which help for developing the various skills
and knowledge. Along with this also, I have also analysed how the leadership theories help the
business for meet out their objective and goals (vom Brocke and et.al., 2021). In preparing
report, I was frustrated about the time management, collaboration and knowledge about the given
topic. But later on, I have analysed about that the skills and knowledge which must be developed
and help me for taking some better decision. In making this report I have analysed about those
concepts which help me for taking decision and prepare myself for developing goals and
objective. While from this report, I have also come to know about how the employee and
individual working people that can take place. As well as about which leadership styles is being
more effective for the growth in organization and about what concepts basically help the
employee for improving them.
I have also come to know about which type of skills must be required for completion the
business and manage the work about how this can helpful in the future. I have developed more
knowledge about business environment factor how basically, they are being more effective and
make sure for having more huge development. While this could usually help me for taking some
more right action and how the work that could be managed while working in organization
(Dvorsky and et.al., 2021). Along with, this could also help me for learning about various
leadership styles and how this help for meet the business objective. I have also come to know
about CSR which help the business for working with some sustainable' development and what
make the organization for using their process. In having such things this could also lead for
preparing about various concepts and keep estimation about how the CSR play the important role
for the organization.
Moreover, this report keeps more upgrade about the information for the Zara
organization. As how the fashion industry can help the market and various other factor for taking
their right decision. I was also thinking about that how the work that could be complete on given
time and how should I will analyse given things. Later on, after completion of report I was
thinking about that skills and knowledge which must be achieved and make sure for having
development (Brunk and et.al., 2021). In making such report, I have analysed that in working
with organization, leadership styles which play important role and how this will help the
business for taking some right or measure steps. As the recommendation of leadership styles

which seems to be organization growth and I have also come to know about this leadership styles
must be followed by the overall organization.
CONCLUSION
From the above report it had been concluded that, SWOT and PESTEL analysis that help
the organization for knowing about the external and internal factor. Along with this also come to
know about how those factor will help the business for taking some right decision. While, also
examined about the what changes in PESTEL factor is being highly influenced by the threats' ad
opportunities. Moreover, about what business factor that is being addressing with the strengths to
negate the weakness and threats affecting their opportunities. Recommendation of leadership
styles as affliative and democratic leadership styles which play the effective role and how this
will help the business for achieving the objective and goals. Also, evaluated CSR process in
organization and personal experience about for making the report.

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Online
Zara Corporate Social Responsibility, 2020. [Online]. Available Through :
<https://phdessay.com/zara-corporate-social-responsibility/>