Zara Case Essay

Words: 1470
Pages: 6

Q1a. Should the company upgrade the POS terminals to a modern operating system?
It might not be in the retailer’s best interest to perform such upgrade, as the new system will replace three of the existing legacy systems in terms of ordering and fulfillment. The IS department will perceive such upgrade as a radical move and is expected to show high resistance in response to it. Even though Zara has a decentralized decision making process, the retailer’s IS department exercises absolute autonomy on the IT infrastructure and design. The fact that “only one person had left the department” in the past 10 years further confirms that the retailer is suffering from cognitive and action inertia, and thus creating a huge barrier for such
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As the Zara in-house POS system is implemented on an O/S which the vendor has dropped support, no official fix will be prepared once system or software bugs are identified which might lead to unstable system behavior or security leakage.
-Running critical services on out-dated O/S will also limit the compatibility and extensibility with the improving software and hardware. This will prevent Zara from sustaining business growth by further improving scalability of services using enhanced hardware architecture or enhanced networking capabilities with other IT software/inventory systems.
-Moreover, as IT hardware is improving in a rapid pace, legacy hardware components might not be available in the market for Zara's purchase. Zara might face difficulties in purchasing commercial license for O/S that vendor has dropped support.
-Unconnected terminals between headquarters and POSs might implied out-sync or inconsistent information sharing in time-critical information such as inventory. Bottleneck in information sharing or slow responsiveness from customers' query are fatal to real time sales, especially Zara is focusing on Fast Fashion Business and place Inventory Management as their competitive advantage. IT strategy
-Zara fails to identify how IT can further improve and achieve the company's competitive advantage. For example, while Zara's success based heavily on competitive Inventory Management, the company fails to further improve it by enhancing