Significance of E-business in Zara

Discuss about the Report for Information System of Service Design Space.

Over the past few decades, the explosive growth in the information and communication technologies has brought effective changes in the business management. It has transformed the way of business communication and management procedure. The cost of the communication and distribution channels has been reduced by implementing such information and communication technologies (Pantano 2014). Similarly, Zara, the international fashion retail company has been trying to expand the business to enhance the number of retail stores in America and Asia (Core.ac.uk 2016). The business expansion through the e-business implementation has set the higher standards of management operations. The research is based on such implementation procedure and the significance of e-business. The application of the diversified techniques will be discussed accordingly.

The internet e-commerce is currently considered as the basis of the globalised businesses. The establishment of the electronic digital interference has been contributing the efficiency to the operational activities. The electronic signals in the virtual spaces are the most convenient way of communication with the internal and external world of business. The managers of the company can interact with the board members easily before undertaking any relevant decision. Brogi et al. (2013) opined that it is necessary to provide the employees proper training regarding the use of such information and communication technologies. It is beneficial enough in extending the knowledge of the managers as well as the employees. It is to be stated that the internet e-commerce system has been redefining the value chains of the industries and creating the dynamic competitive environment. Cagliano et al. (2014) pointed out that the internet e-commerce has replaced the intermediaries. Therefore, the managers can easily communicate with the business stakeholders and ensure their needs. However, the senior executives face several potential challenges in structuring the global economies. It has been seen that, the economic infrastructure could face the changes due to the development of the digital marketing (Soto-Acosta, Popa and Palacios-Marqués 2015). Therefore, it is necessary for the management of the business to cope with such changes by adopting different strategies.

E-commerce has been providing a number of opportunities to the business management in this current era.  Simultaneously, the management executives are also exploiting such opportunities to bring the improvisation in the operational management process. E-business is introducing the cost-effective marketing procedure. García-Álvarez (2015) indicated that e-business allows the management to utilize more than one marketing tactics. It includes social media networking, e-mail marketing, e-newsletter, ad article marketing procedure. It even provides the flexible business hours to the associated employees. The management has found that e-business is eliminating barriers related to the business locations. The availability of the 24*7 hours internet facilities are generating the business profits in a significant manner. The online business is even reducing the cost per transaction. In fact, it does not require the manpower to complete the business activities (Crandall, Crandall and Chen 2014).

Design, Development, and Implementation of E-business

Apart from these facilities, the management has explored many other opportunities. Zara has been concentrating on expanding the business in America and Asian countries. Sometimes, the geographical barriers become the challenge for selling the products. The implementation of the e-business has eliminated such obstacles. If the internet connection is available, the business can sell the products anytime anywhere. In fact, there are the opportunities to reduce the costs of many segments.  The e-business facilities cut down the charges of the physical locations (Vu 2013). The customers can place their orders through online sources. Hence, the company would not require any particular sales person. The fast online transaction is even reducing the barriers related to the payment. Another most recognisable opportunity of establishing e-business is the customers can share their experiences through the online pages. In such cases, the management does not require to arrange the promotional events to receive the feedbacks. The management can even interact with the internal executives through the digital communication system.

The implementation of the e-commerce business is not an easier process. The design needs to maintain the proper structure at the initial stage. The senior management has to take the responsibility while structuring the design of the system (Ross 2016). Zara has the strong reputation in all over UK. However, the company requires expanding the business in America and Asia. In analysing the managerial perspectives, it is required to structure the e-commerce sites in a specific way.

While designing the e-business sites, the senior management needs to take the responsibility. It is required to have a particular vision, which is important for informing others about the requirement. In considering the first step for designing the e-commerce, the management needs to build the design team. It is to be noted that the development of the e-business involves the issues, which are needed to be addressed systematically. Various aspects are associated with the design and development process of e-business. For instance, leadership, deconstruction, cross functional integration, reconstruction, resources, and partnership are needed to be considered (Weske 2012).

Architecture: The products associated with back office and the ordering systems are needed to be provided in a secure way. This information should be on demand to authorised phones.

Platforms: The ERP products and existing modules are communicated with the help of GPRS system.

Infrastructure: The internet is the backbone of such e-business. The micro computer hosting SAP and public mobile networks are also useful for formulating the infrastructure.

Responsibilities of Managers

In considering the implementation process of the e-business, it is important to focus on the first two columns of the architecture field. The recognition of the infrastructure and the platforms is necessary before evaluating any implementation decision. However, it is seen that the elements associated with the infrastructure and platform are evolved with several recognisable risks (Alter 2013). The association of the technologies is always challenging during the implementation process. The mismanagement of any of these technologies can hamper the entire system. In such cases, the manager needs to integrate different organisational functions for undertaking the e-business initiatives. The e-business plan includes the internal and external resources. These resources are skills, finance, knowledge, leadership, capabilities, technology, management, and time (Crandall, Crandall and Chen 2014). However, the implementation process includes some set of choices. These are as follows:

1) Customer Blueprint: This blueprint specifies the major needs and requirements of the customers. Accordingly, the associated risks and the issues can also be identified.

2) Development Blueprint: The development blueprint helps in designing the relevant framework for the projects of the enterprise. It helps in understanding the proper sequential process of the projects (Hamar, et al. 2015). This blueprint suggests the application of the proper methods and the interaction with the senior management.

3) Integration Blueprint: This is the process of reviewing portfolio that is structured for the active projects.

It is to be indicated that the structured designing f the e-business has brought success to Zara in the business expansion project. Breaâ€ÂSolís, Casadesusâ€ÂMasanell and Grifellâ€ÂTatjé (2015) mentioned that the structural design and implementation of the strategic e-business is the key to improvise and reform the competitive advantage. However, the design and the implementation process sometimes create the hazardous situations for the managers. The managers need to address several considerations before implementing the e-business strategies.

1) Before implementing the plan, the managers need to ensure that the plans include the flexible blueprints. In terms of accommodating the changes to the business environment and technological development, the rigid processes are needed to be eliminated (Landaeta Olivo et al. 2016).

2) The managers need to concentrate on controlling and managing risks. These risks are usually associated with the technology based features, financial development, operational performance, and the security issues.

3) It is much important to select a leader who can help in extending the wider network to derive more resources in time of need.

4) The managers need to ensure the sufficient resources are available during the right time of need.

5) It is required to build interoperability across the functional areas, which usually create the significant value for the business purposes (Serra and Kunc 2015). Apart from this, creating the new values is also essential.

6) The employment should be based on the proper job role, which is determined as per the satisfaction level of the business objectives.

7) Each of the business processes including the technicalities and other segments are needed to be updated properly (Tahir, Waggett and Hoffman 2013).

8) The professional outsourcing management practices are required to develop the projects that are conducted by the third party.

This set of responsibilities of the managers sometimes can be too much challenging for the associated managers. However, the implementation of such development process can surely bring success to the company, especially, in terms of expanding business.

The e-business helps the company to grow in the competitive market and strengthen the organisational reputation. E-Procurement is one of the significant processes to identify the changing demands of the customers. Soto-Acosta, Popa and Palacios-Marqués (2015) stated that e-procurement helps the company to utilize the internet network for procuring both the indirect and direct materials. Apart from these materials, it ensures the involvement of the value added services, such as documentations, quality validation, warehousing, and customer clearing.

E-marketing is an extensive area of the e-business. With the help of e-marketing procedure, the company connects with the customers worldwide. Zara is expanding the business in America and Asia. Including the UK customers, the company can get connected to the Asian and American customers with the help of the e-marketing process (Ccsenet.org 2016). Moreover, in this current world, people are much fond of the online shopping and communication though online mediums (Leih, Linden and Teece 2014). In such cases, e-marketing is the significant procedure of benefitting the company’s profitability.

In this current world, the supply change management is also improvised by the skilful process of e-business. According to Meggs, Greer and Collins (2012), SCM is the skilful process, which determines that integration unit of the organisation along with the coordinating materials for supply chain. It helps in understanding the customers’ demands and calculates the financial flows for the expenditures. The aim of creating the proper e-SCM is to improvise the competitiveness of the supply chain management.

E-CRM is the process of building the skilful relationship with the customers through the online sites. It has been found that majority of the customers search for the informative sources online before purchasing any product. Hence, it is important to understand the basic needs and the demands of the customers (Malić, Makitan and Petrov 2016). If the executives of the company can fulfil the queries of the customers, it would be effective enough in building the skilful relationship. Moreover, it brings the reliability and trust for the future dealings.

With the advancement of information technology and development of numerous web pages, electronic business has become one of the convenient, effective and fastest strategies for both consumers and organizations. It has a significant impact on the business operations with respect to promotion of products, trading of products having considerations for processes, government and people (Hamar et al. 2015).

 In this view, management of Zara has also planned and implemented e- business strategy for expanding its business, spreading awareness to people and building strong customer relationship. As the company is focusing to expand its business mainly in Asian and American countries because the society of these countries is educated and tech savvy. Additionally, the economic condition and financial position of Asian and American countries are strong so the company will be able to maximize its profits through the expansion of its business through online process.

Internet is though imperative for the entire fashion industry that makes the brand more reachable and to more consumers. For Zara, the strategy on electronic business helps it to arrange the internet channels that are authenticated as a source to expand revenues and profits as well as strengthen the customer base. Management of Zara has implemented the strategy to provide latest designs of the outfits images with innovative dynamic technologies to create a benchmark for the standards and excusive designs of the products (Breaâ€ÂSolís, Casadesusâ€ÂMasanell and Grifellâ€ÂTatjé 2015). However, there are certain benefits and limitations that Zara faces on implementing the e-business strategy.

Competitive advantage is one of the significant benefits that the company enjoys on implementation of e- business strategy. Internet is a medium through which one can reach to people anywhere and at anytime (Landaeta Olivo et al. 2016). Therefore, e- business strategy helps Zara to reach maximum people worldwide to make them aware about their latest fashion trends, exclusive designer outfits, sales promotions, offers and information on store locations. The company has also provided the facility for online shopping to maximize its customer base and revenue generation.

Electronic business like any other strategy comes with cost and risk factor. As the company’s purpose is to expand its business Asian and American countries, the cost structure of e- business is low but the risk is higher. Investment cost, inventory cost, cost to acquire several outlets other maintenance cost, duties, and taxes are savings on part of company’s expenses. On implementing the e business strategy the company has managed to save around thirty percent of its total costs (Rita and Krapfel 2015). However, the company is facing certain risks on e-business strategy with respect to business, information and technology risks. Electronic advertisements sometimes lead to defamatory statements, violation of laws of home countries or even copying the designs or any other information not meant to be leaked.

Accuracy is another risk in e- business strategy in context to several issues that affect both customers and company. Technological error may reflect difference in number of stock of products actually available by Zara and the number showing on the web pages to the consumers. Apart from that, the management often faced errors in processing of transactions for online sale of certain outfits to the customers (Molenaar 2013). Even though the Asian and American countries are technologically advanced, internet disturbance, or software issue might occur anywhere at any time. Further, it is also important to keep updating the web pages with the right information and details so that consumers do not get any untrue messages. Therefore, the management of Zara is taking efforts on continuous updates and error free online services to the present and prospect consumers.

E- Business is a critical strategy that has to provide reliable and secured services to the organizations as well as to the consumers. Through e- business, physical interaction between consumers and company management becomes impossible hence, it is very difficult to understand the customers’ choice and reviews. It is also difficult to maintain secured operations through electronic business whether it is promotion of products or processing of transactions (Serra and Kunc 2015). Advancement of technology also created many unauthenticated accounts as a part of hackers. Hence, to identify the authenticity of consumers identity before dealing with them is a significant limitation of electronic business. Along with that, processing of transfer of payments is also under serious limitations company has to face as the payment is made through credit cards, net banking or debit cards. So it is very important for the management of Zara to authenticate the payment mode before accepting any orders from the consumers.   
It is much necessary to eliminate the functional errors. The management of Zara needs to concentrate on the development and optimization process. E-business involves the electronic communicational process, which enhances the diversified aspects of supply chain management (Petrovic, Milanovic and Kalinic 2012). The optimization of the organisation’s value chain is also associated with such e-business process. The e-business change management is focusing on the achievement of the significant performance improvements.  Installing new system is the part of the change management in e-business (Harrigan, Ramsey and Ibbotson 2012). The effective leadership skills are thus required to understand the requirements of change management. The management of Zara needs to interact with the executives and the other people associated with the e-business process about certain changes. The optimization of the process would thus be considering the successive approach for establishing e-business.

Conclusion

The study has been focusing on the e-business management process undertaken by Zara. It is discussed that the emerging business market is much fascinated by the sophisticated trends. It is noted that the e-business has been a compelling enabler of e-CRM, e-SCM, and e-Procurement. The set of responsibilities ensured by the managers can sometimes bring the potential challenges. However, the recognition of the benefits and the demands of the customers is the most helpful way of developing a business. In fact, it can be stated that the continuous achievement of the customer satisfaction can bring the enormous success to Zara while the company has been expanding the business in other countries. The structured process of designing, development, and implementation is essentially required for the further business success. If judged from the managerial perspectives, it can be stated that the managers have to take the full responsibility of managing e-business. The maintenance of the set of responsibilities by the managers would be helpful in preventing the potential hazards. Zara can even improvise their business performance through the implementation of the new technologies. The customers would be connected to the company sites.

It is noted that the evaluation of the e-business has been facilitating the establishment of the e-CRM process. The customers are much connected through social sites and other online sites. In case of the fashion industry like Zara, the customers are more fascinated about the style segments. The e-business of Zara has been providing the opportunities to select among the various ranges of products. However, the managers have to take the major responsibilities to communicate with other associates. The implementation of the information security is not an easier process. Hence, it is required to recognise the potential risks before implementing the technologies required for the e-business process.

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