Resilience and Challenges in Operations Management: Zara's Response to the Covid-19 Pandemic

Preparing for Resilience and Challenges Aim of this Coursework

Question: Preparing for Resilience and Challenges Aim of this Coursework During this module we have started to explore issues of resilience and challenges within operations management. Such issues have been in the background for some years, though have been brought into focus because of the Covid-19 pandemic.In this module we have seen how, in normal times, Zara has an excellent model for its operations management and supply chain management. This submission provides an opportunity for you to review the learning about resilience, seen perhaps in the short-term impact from an external event Covid-19, and the ongoing and longer-term challenges that need to be addressed, by looking in detail at how Zara has and could respond. The Submission A 1500-word individual reflection faced by Zara on the resilience and challenges in its operations management. Background The first quarter of 2020 saw the Inditex Group suffer is first loss in its history, Figure 1.   Figure 1 Key financial figures of the Inditex Group worldwide in first quarter 2019 and 2020(in million euros), Source Statista1 One significant reason for this loss was that it was required to close 3500 stores worldwide during the first lockdown at the beginning of the year.2Zara had to respond quickly to the crisis. It is planning to close 1200 stores around the world, and to boost online sales.3 It also responded by manufacturing PPE within its supply chain, and donating items already in stock to those in need.The Inditex Group was able to make up some ground during the rest of 2020, though overall its sales fell back to near 2015 levels, Figure 2.   Figure 2 Net sales of the Inditex Group worldwide from 2013 to 2020, by format (in million euros), Source Statista5 Other aspects of how Zara has performed this last year are shown in the accompanying presentation to the seminar on Zara, available on Moodle. Your submission in detail You are a consultant brought in to review the response of Zara to the Covid-19 pandemic, to evaluate its resilience and also to review the longer-term challenges that Zara faces. Using as a starting point the Zara’s structural and infrastructural capabilities (as described within our seminar, and seen in my listing of these on Moodle) you are required to review Zara’s response using the Profile of a Disruption model as outlined by Sheffi and Rice (2005).6 It is recommended that you provide an evaluation of the Vulnerability7 of Zara, again by Pettit et al. (2010), together with an evaluation of its Failure or Disruption modes for its Operations, again by Pettit et al. (2010). In your answer you are also required to state and review two longer term challenges that Zara faces. In addition, you are welcome to use any of the models or understanding as set out in Lecture 8 on Resilience in Operations Management, and Lecture 9 on Challenges Management. This submission mirrors real life, in requiring you to evaluate a company’s resilience and challenges even when such understanding is limited, setting out reasons for your choices.