Zara & IPremier: Strategic Information Systems
1 (a): Zara, at the time of the case had a low-cost, robust and reliable POS system. If the system broke down, the solution was simply to reboot it or reinstall the software. It is evident that Zara when considering Nolan & McFarlan's (2005) ‘IT Impact Grid’, is in support mode and is not highly dependable on IT. Also, Zara is not concerned with innovation in terms of technology, the key element of it’s strategy is to grow and increase the number of it’s stores. This puts into question the need for a new POS system, as it’s existing system is strategically aligned to low-cost and easy to implement replication across new stores. The implementation of a new POS system at Zara would create a number of risks, three of which are discussed below: operational risks due to IT dependency, overspending and disruption to business processes and knowledge.
As Carr (2003) discusses, implementing a new POS system would introduce a number of operational risks such as technical glitches, obsolescence, service outages, unreliable vendors or partners, security breaches etc. With a new system, disruption or outages could paralyse Zara’s operating systems and processes such as: the ordering and delivery process; the flow of information sharing with headquarters (and possibly other stores); the POS transactional process; the customer experience; and in turn the customer satisfaction. Also, with the existing system, each store is hard wired back to Zara’s headquarters, thus, the security risk may be comparably higher with a new system, as all of Zara’s information would sit on an IT infrastructure integrated across their company and network of stores. This infrastructure would provide a means of access for hackers etc. The above points come to the conclusion that the more integral a new POS system is to Zara’s business model, the