Zara Core Competencies

An organization must identify its core competencies and strategically align those competencies with its business objectives to achieve success. In fact, C.K. Prahalad and Gary Hamel explained in the Harvard Business Review that the most powerful way for an organization to prevail is for it to “identify, cultivate, and exploit the core competencies that make growth possible” (2000). Lockheed Martin has thoroughly aligned its competencies, business objectives, and key performance indicators, which has undoubtedly contributed to the corporation’s effectiveness.

In order to achieve and sustain competitive advantage, a business needs both resources and capabilities. Resources are assets that are owned or employed by an organization. The organization utilizes and uses these assets to carry out their business operations. Resources can be grouped either tangible assets or intangible assets. Capabilities are complex skills or ability that a firm develops with time to perform business operations competently and utilize their resource effectively.

After thorough investigation of the Lincoln Electric Company’s (LEC) Harvard Case Study, certain understanding and reflections may be made about the company’s culture from a multi-faceted perspectives such as the visual aspects of culture and its maintenance dynamics as observed in the textbook’s Chapter 8.( Carpenter, Taylor, & Erdogan, 2009)

QP suggested Kayla 's mother write rules on a poster board and decorate it for the kids.

I learned from experience when I was doing community hours at the Kiwanis Thrift Store a few years back. Even though the Kiwanis’s store and staff were small, the staff have to do tremendous daily work. People donate their no longer used items to the store like furniture, clothes, appliances, kitchenware etc. These donations are classified as raw materials considering it’s the only way that it can gain its inventory. Although these donations are the only way that the store gains its inventory, doesn’t mean it’s the only input the store offers. Other examples of inputs are power, labor, teamwork, materials used for the store, and money. These inputs are used to create outputs that helps generate profits for the store as different services, reused items and multiple ideas trying to improve the store. The staff at the Kiwanis is constantly trying to reduce the amount of donations that arrive at the store each day. Employees there must plan how to: either determine if the product is worth to resell, how to organize all non-put out items, where does it belong in the store, etc. Every item must be tested if possible to see its

Not every capability is a core competence, although every core competence is a capability. In order for a capability to be a core competence it must possess the four core competencies. The four core competencies are capabilities that are valuable, rare, costly to intimidate and non-substitutable. When a competitor lacks resources to attempt imitation or when a company cannot duplicate benefits of a firm’s strategy is when a sustainable competitive advantage exists.

What are the two types of core competencies that drive a firm’s competitive advantage? Which firms demonstrate a clear competitive advantage because of (a) major value-creating skills/core capabilities and/or (b) superior assets or resources? Which firms have demonstrated sustainable sources of competitive advantage?

Therefore, the acquisition of Whole Foods Market will allow Amazon to reach a market that Amazon has not fully reached. Whole Foods Market is a grocery store “seeking out the finest natural and organic foods available, maintain the strictest quality standards in the industry and have an unshakeable commitment to sustainable agriculture” (Wholefoods). Whole Foods tangible resources include their brick and mortar stores and their financial capacities. Their intangible resources are the ways they organize Whole Foods, their employee strives for customer service and their brand reputation. Furthermore, Whole Foods core competencies include highly healthy and organic products that Whole Food offers, their brand reputation, the reason why is because

due to the appeal of this type of industry. The core competency for this company can be

Chipotle is a leading company in the growing fast-casual dining market. Established by C.E.O Steve Ells in Denver, Colorado in 1993, Chipotle soon made an impression on its customers by providing food with high-quality raw ingredients and classic cooking methods to create great tasting, reasonably priced dishes that are readily served to customer’s within minutes after being ordered. The food Chipotle offers is simple and includes burritos, burrito bowls, tacos and salads, plus soft drink, fruit drinks, beer, and milk. However, customers can customize their own options including different meats, beans, rice and vegetables. They keep an assembly line setup in all of their restaurants which helps cut down on time/resources when helping customers. They also keep a small amount of choices to ensure fresh and high quality meals.

Motivation could be defined as factors that stimulate people to act well on a certain topic. Moreover, it is crucial to know what motivates whom, because every individual has certain factors that act to motivate them which differ from everyone else. Some employees could be extroverts so working on team projects or in groups could motivate them because they have the team spirit. On the other hand, some other employees would be motivated by the idea of change and making a difference. This case study is presenting Enterprise-rent-a car; while the main concern of the topic is motivation. Enterprise-rent-a car is an enterprise providing service which is renting cars. In 1957, Jack Taylor started the enterprise in ST. Louis U.S. in a car dealership’s basement. Nowadays, the company owns over 750,000 cars in service all over the globe. The international operations of the enterprise main concern are providing a well suited and trustable service at an acceptable price; moreover, customers will use the service over and over again. The enterprise’s competitive advantage is their excellent customer service which requires “highly motivated staff” in order all of tasks required to provide the service with high quality. The enterprise has its own culture which

Zara is vertically integrated and takes care of designing, manufacturing and distributing its products. This gives it an immense hold on the market as most of the operational inefficiencies are eliminated by the company’s on employees who identify with the larger goal and value proposition of the brand (The New York Times, 2012). Zara works along with the consumers to understand them more closely rather than imposing its own predictions on them. Zara creates an environment of artificial scarcity in its stores for every design it manufactures so that consumers get a feel of exclusivity rather than stock pile up (Johnson, 2012). This gives them a sense of pride to buy a limited edition of products which they find at Zara stores only. Zara invests around .3 % of its revenues in advertising as compared to its competitors who invest around 3-5 % of their revenues in advertising. This increases its availability of funds for investments in design and in-house manufacturing rather than cutting the cost on these crucial operations. The lack of advertising is compensated by placing the stores at popular locations with good footfall and thus raising the customer inflow by the virtue of its store locations. Zara has been able to maintain a loyal relationship with its

In terms of differentiation, ZARA’s “fast fashion” philosophy is unique, which create demands and lead the trend in the garment market. They respond very quickly to the demands of target customers and focus on young fashion. In production, they design quickly, production quickly and update quickly. They are always the fastest compared with their competitors. In cost leadership aspect, ZARA conducts little advertising and vertically integrated manufacturing operation and distribution system based on information system. Inside the company, their organization structure is simple and employees work with high participation, so that the whole company runs efficiently. All above allow ZARA to provide products with lower price. ZARA has a flat organization structure, which emphasizes a decentralized decision making approach; The design team are relatively independent; Store managers have more responsibilities. Team structure is important for operating organization

-Physical factors: municipalities growth, population go to the regions are more developed, so we have to considerer what are these areas to create there our business. Climatic diversity, Zara knows this diversity so the clothes that it produces will be linked with the climatic of the region, for example, the North is cold, so the winter´s season arrives before.

Nowadays, with the improvement of living standard, fashion has becoming more and more important to the world. There are lots of different types of fashion companies all over the world. One of the most popular companies called ZARA. ZARA is a fashion clothes company which was founded at 1975 by Amancio Ortega who is a fashion retailer group company’s founder from Spain. That means ZARA is a subsidiary of INDITEX. ZARA’s business scope including clothe, accessory, shoes, hat and perfume. Because of their excellent operating capability, they can become successful each and every year.