Zara Technoligy can Change Everything Term Paper

Zara Technoligy cigarette Change Everything - Term Paper ExampleSo he integrated forward, opening the first Zara shop in La Coruna in 1975(Mcafee et al., 2007, p.3). The ingathering of Zara was phenomenal since its establishment in 1975. The success of first Zara gillyflower encouraged Ortega to open more wearing stores across Spain. It is often said that the innovation and ability to expose new products and services are decisive factors in boosting the growth of an organization. Zara did succeed in introducing new clothing products and tr leftovers in the market quite cursorily. Moreover, Ortega gave more emphasize to the production of new designs establish on the rapidly changing industry trends, which helped him to compete effectively in the market. 1985 was a year which has huge importance in the history of Zara. Two major events occurred in this year that changed the entire face of the company. First, Inditex (Industria de Diseno Textil) was formed as a holding company ato p Zara, other retail chains and a network of intern tout ensembley own suppliers. Second, Jose Maria Castellano Rios joined the company (Mcafee et al., 2007, p.3). Being an expert in IT, Castellano did everything possible to incorporate computer link technologies at every corners of the company. He had realized that without computers and internet, no industry advise look forward and he changed the face of the company from a low end clothing company to a high end technology based clothing company. It should be noted that the net margin of Inditex increased from 7.21% to 11.2% during the period of 1996 to 2002 (Mcafee et al., 2007, p.16). The supra statistics clearly suggest that the company is growing in the right direction since the introduction as a result of the innovative business strategies and the judicious use of technology in all the functional departments. At the beginning of 2003, Inditex operated 1,558 stores in 45 countries, of which nearly 550 were part of the Zara ch ain. For its fiscal-year 2002, Inditex had posted a net income of A438 million (Mcafee et al., 2007, p.5). The growth of Zara can be better understood with the help of Michael Porters five forces model. Zara and Porters five forces model Michael Porters famous five forces model is used extensively at present in business sectors to analyze the competitive agency of an organization in the market. It helps business wad to realize their strengths and weaknesses. Since market is changing rapidly because of the rapid technological growth, no organization can promise their top spot in the market, if they are reluctant in making periodical changes in their business strategies. For example, the rivalry between Apple and Microsoft is famous. Even though Microsoft concentrated only in the operating arranging market, Apple diversified its portfolios to many other fields and they became the most valuable technology company in the world at present, pushing Microsoft far behind. In other words , organizations should make changes in their business strategies based on the changes in the market in order to keep their competitive power intact all the time. Porters five force model helps organizations to measure their competitive power at a given time period. Porter model can be used to foresee the future threats and opportunities and the organizations can plan well accordingly. According to Michael Porter, five competitive forces that may affect an organization are little terror of substitute products, Threat of new entrants, Intense rivalry among existing players, Bargaining power of suppliers and Bargaining power of Buyers (Porters Five Forces Model, 2009). The following illustration makes these points clearer. (Porter