Zara – Sustainable competitive advantage using the ‘RBV’ approach
Vadybos kursinis darbas.
Zara – Sustainable competitive advantage using the ‘ RBV’ approach. Resources Based View. Vertical Integration in manufacturing. Distribution Network. Operations and human resource knowledge.
Zara a high-fashion industry, which has a successful business model contributed profitable growth for its distributor ‘Inditex’. This states net income of 340 million on revenues in 2001. ‘Inditex’ is one of the fastest growing manufacturers of affordable fashion clothing (Z1). Since, Zara is a one of the chain in the ‘Inditex’ operations, it was successfully managed by raw materials, manufacturing plants and logistics that influenced Zara’s success for its’ product design, manufacturing, distribution and retailing image (Z8). In order to create a sustainable competitive advantage, Zara is most concentrated on the flexibility and quick response. This generated to achieve quick delivery, diversification and value to provide the newest fashions. Still, the rapid consolidation and flexibility can be difficult to accomplish as it requires high investment and proper choice of methods among competitors (Chen, 2004). In this essay will be evaluated Zara’s performance to achieve a sustainable advantage by using it’s ‘RBV’ and dynamic capabilities analysis.
‘RBV’ is an approach to effectively achieve a sustainable competitive advantage. According to Barney (1991), this uses a more specific regards as all resources (assets, capabilities, organizational processes, attributes or knowledge) controlled by a firm that enable implement strategies to improve its efficiency. Resources are designed into tangible and intangible ones that should be effectively managed. It states that the resources control becomes strategically relevant when it concentrates on Value; Rareness; Imitability; and Substitutability (Patricia, 2014). This effectively ensures the competitive advantage sustainability.
Zara makes a major investment in its’ manufacturing, logistics and IT systems in order to ensure its quick fashion response and economic advantage. The vertical integration into manufacturing effectively allows to gain a sustainable competitive advantage for Zara (Z, 9). The companies which are focused to deliver the speed and flexibility, the traditional logistics practices and technologies becomes necessary but not sufficient for competitive success.