Operations and Supply Chain Management Assignment Sample

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Introduction Of Operations and Supply Chain Management Assignment

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One of the main objectives behind conducting this study is to shed light on the topic of operation and supply chain management. Operation and supply chain management comprises of a wide space which takes into account altogether producing as well as service based sectors comprising the role of sourcing, material administration, function designing, allocation, supply along with demand fulfillment. In general, the term operation can be defined as exercises utilized by associations or organizations to change unrefined components or input assets into completed labor and products. However supply chain can be defined as a gathering of autonomous associations associated together via the items and amenities which they independently as well as together add esteem on all together to supply them to the end customer. So, it can be said that both plays a major role in delivering final goods to the end user.

Now, in order to complete the study a company is selected namely ZARA with the help of which the usage of the operation and supply chain notion will be explained. Based on the analysis the problems within the operation and supply chain of ZARA will also be discussed based on which recommendation will also be provided so as to deal with te issues using proper tools and techniques.

Brief about the company

Zara SA adapted as ZARA, is a Spanish attire retailer situated in Arteixo, A Coruña, Galicia, Spain. The organization expertise in quick style, as well as the items incorporates dress, adornments, shoes, swimsuits, makeup products, and perfumes. It is the biggest organization in the Inditex set with Bershka, the world's biggest clothing retailer. Zara till the year 2017 succeeds up to 20 apparel assortments a year. ZARA has in excess of 2,000 shops internationally and its stores are situated in prime retail regions where the movement of the customers is in maximum. Considering the sourcing and production of its products it has been seen that 80 to 90% of the manufacturing happens in Europe, out of which near about half is manufactured at A Coruña, the base camp of ZARA (ZARA, 2022). The textures are fundamentally obtained from Italy, France, and Spain. The supply of the product done by the clothes received at the stockroom is coordinated with the prerequisites set by the shops encoded separately. Pleated cloths are pressed through carousel: a transport line machine is extraordinarily intended for ZARA; while the hanging garments are stuffed by coordinating the cluster codes with the piece of clothing codes. Overall it can be said that the operation and supply chain of ZARA works with step by step process including the technology also (ZARA, 2022).

Literature on Operations and Supply Chain Management topics

As already discussed in the introduction part the meaning of operation in short it can be termed as change or alteration. Considering the term operation management which is the main topic of discussion this is usually focused on in what manner the input asserts are modified. This in general comprises of four most important works which are:

  • Planning the operation
  • Designing
  • Commanding
  • Developing (Lewis, 2019)

Overall the definition of operation management can be eluded as the expansion, incorporation as well as conservation of effectual techniques which are connected to the works completed with an intention to attain explicit objectives of the company. Operation management also takes into account administrations as well as various kinds of ventures which the team of individual accepts altogether. Operation management guarantees that associations limit squander in addition to, enhance result and asset utilization to serve clients as well as every other person with dog in the fight, or the partners (Carter, 2005).
However, supply chain management can be defined as the administration of the connections and streams among the 'series' of activities and cycles that produce esteem as items and administrations to a definitive client. It is a comprehensive way to deal with overseeing across the limits of organizations and of cycles. Supply chain management shares one mutual, and focal, objective - to fulfill the end client. The entire of the phases in the different chains that structure the stock organization should ultimately incorporate the thought of the end user, regardless of how far a singular activity is from the final client. Just like operation management supply chain management has also got four important elements which are:

  • Designing
  • Commanding
  • Checking
  • Synchronizing (Parkhi, 2015)

Considering the two definitions it can be said that operation and supply chain management has got different functions to do with some common elements. A basic approach to look the contrast among operations and supply chain management is that the concept of operation predominantly alludes to exercises that occur inside an association while supply chain management alludes to exercises exterior to the association. There are different notions related to both operation and supply chain management which will be discussed below.

Notion related to Operation management

Notion

Explanation

Service Operations Management

Service operations management is the term that is utilized to entail the exercises, choices as well as, obligations of tasks administrators in assistance associations.

The 4Vs Typology

The initial V, volume. This alludes to the actual number of items created inside an activity.

The 2nd V, Variety. This V alludes to the adaptability of the change or the activity's

Techniques in answering the clients' tweaked orders.

The 3rd V is the Variation. This V alludes to the progressions in the pattern of need.

The 4th V is Visibility. This V alludes to the amount of the change cycle does the

client experience

Kinds of Operation process layout

The four types of layout are:

1. Fixed site layout

2. Operational Layout

3. Cell Layout

4. Line layout (Carter, 2005)

Notion related to Supply chain management

Notion

Explanation

Flows within the Supply Chain

Material Flow: All assembling supply chains have material streams from the unrefined components toward the start of the inventory network to the completed items toward the finish of the inventory network.

Data Flow: All supply chains have and utilize data streams.

Finance Flow: All inventory networks have a monetary stream. It is essentially the cash stream or the blood stream of an inventory network.

Business stream: All inventory networks address a value-based business stream.

Outsourcing, Vertical Integration and Offshoring

Subcontracting is the process of arranging within which an organization offers administration for other firm which might be offered in-house

Vertical incorporation is the context which in general functional to entire of the functioning of a company.

Offshoring implies acquiring items and administrations from activities

which are based external one's own nation (Parkhi, 2015)

Application of operations and supply chain concepts to the case organization of Zara

Zara was formed in the 1970s; it is a clothing company spread all over the world. This company is a Spanish fashion clothing company that deals with both manufacturing and retailing. Zara has a very successful collaborative relationship with suppliers and the customers. Zara focuses mainly on the client's needs of different countries, the fashion sense of the people there, and the store sales. Zara mainly targets female customers in urban areas with affordable prices. Though Zara has a huge number of products with them the display they do is very minimal, which shows the exclusiveness of the company. While other competitor companies change their clothing design every two to three months but Zara does it every two weeks. Also in the sphere of variety of items, Zara always puts itself at the front, as compared to other competitors Zara produces about 11,000 distinct items every year in thousands of stores whereas the other companies produce 2,00 to 4,000 every year. Zara has a huge supply chain that mainly focuses on the satisfaction of the customer and customer’s preference(Chang et al., 2019). Zara applies another operational strategy that is they only display the clothes in the store that has maximum size variety so that they can meet the customer's need and they do not want to upset the customer. Zara always keeps a different marketing strategy than other competitors like as they do not provide any discounts or VIP services to show their limited stock on that particular product, meanwhile they provide limited offer notes and keep the shelves unfilled, which attract the customers to run to the stores. Zara has a parent company named Inditex; Zara's production center is attached to this company. Zara analyses and produces its store where there is a large number of females residing with an age group of 24 – 35 years old. Zara produces a less number of commodities with different varieties which grabs the customers' attention and attracts the shop to buy products at a huge amount and enables Zara to offer the customers more stylish products. Spain is known as the rout country of Zara, here the customers visit the Zara stores 17 times per year on average whereas for the competitors it is for 3 times in average per year. This happens because Zara changes the design of the clothes and the variety is hard to find through the internet.

Identifying an issue in the operations or supply chain of Zara

The supply chain consists of all the direct and indirect elements like transportation activities, customer for identifying customer's demand and requests, manufacturer and suppliers, and retailing. Zara has a positive side that it can react immediately to the need of the customers and their fashion trends. Zara also never produces the same designed product in a large amount, therefore they do not face loss in case of production because if the product is not liked by the customers and as a result, it does not get sold out, they do not face an immense loss. Zara produced a variety of products 3 times more than the other competitor companies. But there are several issues in the operation or supply chain like they use an unusual strategy to attract customers to buy their products, they do not provide any advertisement to spread their name as a marketing strategy, as providing advertisement is a good source for attracting customers. This is good for the time being but as the other merchandise companies provide advertisements of their company to reach the customers, Zara may face a bit of trouble to sell their product, this is the main weakness or issue that the Zara Company has. Zara is also facing issues regarding the customer switching their market from Zara to other competitor merchandise companies; this is causing a major threat to the Zara Company. The cost of the Zara product is way too high than other normal company's products, but Zara also maintains the standard price with relevant to other costly companies, and in terms of quality Zara shows up much forward than other companies. An economic downturn like the Covid-19 pandemic can be a threat to the target segment that Zara keeps, the word 'Economic Downturn' means a slowdown in economic activity all over the world or in a particular region. Generally, Zara targets people with higher economic stability in developing countries, therefore an economic downturn can be a major threat to the company. The overall performance of Zara was also affected during the Covid-19 pandemic like all other companies. There was a lack of research on sustainable retailing in the case of Zara (Munerati et al., 2018).

Recommending a project to remedy for Zara

The fabric of Zara is mainly sourced from the countries like Spain, Italy, and France. Around 80 – 90% of productions occur in Europe, among which 50% of production takes place at A Corua, the headquarters. A major part of stitching is done by subcontractors in their workshops and designing and cutting is done in-house. The final quality check of the stitched garments is done at the headquarters, each lot is checked here. The garments are sent for final packaging after the checking gets completed. The overall packaging process is done with the help of state-of-art machinery, with a small human interference in this process. At the headquarters, Zara has a prototype store, where the placements of the garments are tested, and then the replication is done all around the sphere. Zara provides complimentary goods with the product to help the customers to understand the combination. This is the different strategy that Zara has in the field of retailing. Apart from the large-good part of the Zara Company there is a serious weakness or issue that this company has, providing no advertisement for selling the product is the greatest weakness of all that the Company has, it is a unique strategy of them, but at the same time, this unique strategy may lead to a huge loss for them. The loss may occur because in the present era people around the globe is much more digitalized than before; impressive advertisement can attract more people than now. The Company can provide digital advertisements as well as hoardings, this helps to build a better relationship with the customer than presently doing. It will attract more teenagers and adults that are the target group the Zara Company focuses on because nowadays people are surrounded by digital mediums. Reaching to the customer is much easier nowadays by using advertisements, keeping the shelves empty, and ending stocks notice can be kept aside. Covid-19 affected retailing of Zara in huge amounts.

Planning the project using appropriate tools for Zara

It is not easy to manage the apparel supply chain – there can be real challenges like taxes getting constantly changed, in-store inventory and production, shipping issues, etc. The tool that can be used for the Zara Company to get through its weaknesses or issues. No doubt Zara is a successful clothing manufacturing and retailing company from every field, but there is a loophole in this company strategy too, which is again no doubt a unique strategy that puts the company at a different level than any other renowned clothing company around the world. But at present just relying on keeping the shelves empty in a store or putting a notice of stock getting over cannot be a fruitful way of communicating to the customers and is not a good marketing strategy, as people are getting more acquainted with digital mediums, so the advertisement is much necessary. So Customer Relationship Management Service tool can be used in planning the project for Zara –

Zara has billions of customers around the world, and they have a good marketing strategy to attract customers. But presently without advertisement and keeping connected through social platforms-attracting customers, again and again, is very difficult. The Customer Relationship Management service tools help the company to categorize, track and analyze the customer's habits and meet their needs (Gomez et al., 2020). Many Customer Relationship Management tool such as SalesForce involves phases for other targeted promotions like advertisements, hoardings, and e-mail marketing to attract customers, which will be very helpful for the Company.

Conclusion

So, it can be concluded from the above done study that operation and supply chain management plays a very major role in overall functioning of ZARA. Based on the study it can also be identified that ZARA’s operation and supply chain management is quite distinctive as the company use technology for the supply of their products. But at the same time they are facing few of the issues which can be solved by using the mentioned recommendation. Overall from the entire study it can be said that companies need to provide special focus on operation and supply chain management usually those who supply their products and services across the world.

References

Carter, P.J., 2005. Introduction to Operations Management. Supply Chain Management Review.

Gil-Gomez, H., Guerola-Navarro, V., Oltra-Badenes, R. and Lozano-Quilis, J.A., 2020. Customer relationship management: digital transformation and sustainable business model innovation. Economic research-Ekonomska istraživanja, 33(1), pp.2733-2750.

Lewis, M.A., 2019. Operations Management: A Research Overview. University of Bath.

Parkhi, S., 2015. A Study of Evolution and Future of Supply Chain Management. Symbiosis International University.

ZARA, 2022. The Secret of Zara’s Success: A Culture of Customer Co-creation. [Online] Available at: https://martinroll.com/resources/articles/strategy/the-secret-of-zaras-success-a-culture-of-customer-co-creation/ [Accessed 09 March 2022].

ZARA, 2022. Zara is one of the world's largest international fashion companies. It belongs to Inditex, the world’s biggest fashion group. [Online] Available at: https://www.businessoffashion.com/organisations/zara [Accessed 09 March 2022].

Ramia Munerati, L., 2018. The Zara case in Brazil: juridical effectiveness of soft law measures concerning decent work in global supply chains. Available at SSRN 3411472.

Xuejie, C., Chang, Q. and GuangHao, Z., 2019, August. Research on innovation supply chain management in the fast fashion industry—A comparative analysis of ZARA and H&M. In Proceedings of the 3rd International Conference on Education, Culture and Social Development (ICECSD 2019), Guangxi, China (pp. 29-30).

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