Zara Fast Fashion

Executive Summary

The decision to upgrade the POS terminals is necessary as the current system is outdated. A proactive approach is beneficial to continue to improve response time, strengthen the competitive advantage, enhance effective communication, and continue the commitment of future growth. Communication and information technology are absolutely vital to managing the constant interface of various and management of the huge variety of product information. The goal to close the information loop between the customers and the upstream operations of design, procurement, production and distribution quickly and directly can be better realized with new technology. Corporate belief is that computers are critically important to enabling the kind of business we want to build. Sticking to a rhythm across the entire chain requires spending money on anything that helps increase and enforce the speed and responsiveness of the supply chain.

Issue Identification

Currently the POS systems run on DOS which is no longer supported by Microsoft. Zara is the only customer of the terminal maker using the outdated operating system. Although the vendor has said that it has no plans to change its machines so that they no longer run on DOS, the terminal maker will not commit to these assurances in Zara’s contract. Because the current POS application works so well on the DOS system, there is concern that changing it could create headaches for the IT department and the stores. At present, opening a new store requires no IT involvement. The store manager unpacks the POS terminal, inserts a couple of disks in each, plugs a modem into a phone line and starts selling clothes. When placing an order, store managers determine replenishment quantities by walking around the store and determining what is selling by counting garments and talking to sales people. Store personnel cannot look up inventory levels on any in-store computer.

Environmental and Root Cause Analysis...