Card No. Seminar paper from the year 2015 in the subject Business economics - Miscellaneous, grade: 80.00/100.00, University of S. Using customised PDAs, store managers constantly communicate customer feedback, either hard data such as orders and sales trends or soft data like customer reactions to a new style or the buzz around a new design, to Zaras HQ where the feedback is used by designers to quickly develop new garments based on customers wishes (Ferdows et al., 2004). They use an impressive number of automated factories located in Spain, as well as a vast network of over 300 small finishing shops throughout Spain, North Africa and Turkey. Handling service calls. Books related to Development of a Draft Balanced Scorecard for Zara Affiliate Marketing A to Z Thrivelearning Institute Library $0.99 Startup Weekend Marc Nager $15.00 Managing Outsourcing Deirdre Garvey $6.99 Human Resources Management: An Overview Cultural Human Resources Council $8.00 Supply Chain Management. VAT The corresponding process is presented in figure 1. Broadly there are four main components / features of Balance Scorecard. What is required to improve the brand equity or market performance in terms of marketing, sales, distribution, and pricing strategy. Lack of review structure often Balance Scorecards are made by consultant and lacks a clear organization wide review structure. Since their introduction, BSCs have been adapted for a variety of industries, including to healthcare settings. 2015 Online Fashion Retailing, Retail Banking, and . Revenue and/or value added per employee Free Online Balanced Scorecard Maker: Design a Custom Balanced - Canva A balanced scorecard focuses on both high-level strategy and low-level measures. Some users, including executives, really wanted a tabular, scorecard style of KPIs. Appendix F-BSC Scorecard H&M strategy map includes the 4 factors of the balanced scorecard and is depicted as it follows. V rmci sv praxe ve firmch pochopily omezenou schopnost pouhch finannch ukazatel pro stanoven, men a kontrolu spnosti realizace . New sales as a percentage of total sales Focuses on Inditex, an apparel retailer from Spain, which has set up an extremely quick response system for its ZARA chain. Return policy By fostering cross-functional teamwork, Zara ensures the quick exchange of information and thus decreases the time it takes to turn sketches into products ready for shipment (Ferdows et al., 2004). Balanced Scorecard: The Comprehensive Guide - ClearPoint Strategy AbeBooks.com: Development of a Draft Balanced Scorecard for Zara (9783668002135) by Mertens, Marvin and a great selection of similar New, Used and Collectible Books available now at great prices. 1. Simon Irvin of Credit Suisse, criticising Inditex''s recently lacklustre financial performance, noted that business models were not likely to remain brilliant forever, and that Zara''s parent company were no exception to the rule (Buck, 2014). Home [www.inditex.com] Placed at number #41 in the Forbes ranking of The Worlds Most Valuable Brands, there is no doubt that Zara came a long way from when it was founded in 1974, becoming one of the worlds best known fashion brands and the flagship brand of the 2.5 billion holding group Inditex. - What is important for Zara Inditex shareholders? How to Implement the Balanced Scorecard Framework + Examples A Balanced Scorecard is a Strategy Tool that helps to track the performance of a Company by analyzing a set of Factors. The Balanced ScorecardMeasures that Drive Performance Typically, each perspective will have multiple strategic goals (at least two or three) to focus on. Zaras most important competitors are other retailers associated with the fast fashion industry including Benetton, Mango, Gap, and, most notably, H&M (Caro & Martnez-de-Albniz, 2014). Information availability relative to need. Balanced Scorecard approach focuses on comprehensive metrics rather than only local optimization in various spheres such as financials, operations, internal processes, and customers needs. Information availability relative to need. - Are we innovative and ready for the future? Other major followers and imitators include Uniqlo and H&M (Girotra & Netessine, 2012). Despite these limitations, however, Zara's parent company, Inditex, has built an extraordinarily well-performing value chain that is by far the most responsive in the industry. For instance, C&A purposefully hired away Inditex managers (The Economist, 2012), while Mango even managed to outpace Zara in terms of sales in Spain, Zaras home market, by copying Zaras approach to manufacture the majority of its garments in nearby countries, as well as the firms product offering (Baigorri, 2013). Kumar and Linguri (2006: 84) describe them as trendy city youngsters. Balanced scorecard digunakan untuk mencapai tujuan, pengukuran, inisiatif, dan sasaran yang dihasilkan dari empat fungsi utama bisnis ini. Pankaj Ghemawat, Jose Luis Nueno (2018), "ZARA: Fast Fashion Harvard Business Review Case Study. Development of a Draft Balanced Scorecard for Zara - Alibris Overcome obstacles to implementing a Balanced Scorecard in practice. This balanced scorecard template offers a professional, easy-to-read layout in Microsoft Excel (you can hover over each cell for instructions). Balanced Scorecard is a resource focused strategic analysis tool. Balanced Scorecard also provides a base to build a metrics framework that is aligned and consistent. Having said that, numerous attempts have been made by competitors to copy Zara''s successful business model and thereby eliminate the firm''s competitive advantage. The Basic Balanced Scorecard Template - PowerPoint Power KPI Matrix supports an unlimited number of KPIs in a single visual, along with . It links a vision to strategic objectives, measures, targets, and initiatives. Academy of Management Executive, Vol. REVIEW OUR APPROACH. Having started as a small fashion store in A Kaplan together with the US consultancy Nolan Norton. The balanced scorecard allows managers to look at the business from four different perspectives. The Balanced Scorecard is a very mature methodology; it's been around since the early 1990s. Identify your strategic objectives. Tesla Motors Balanced Scorecard.docx - Course Hero Feel free to connect with us if you need business research. Balanced Scorecard Analysis & Solution, Mercadona Balanced Scorecard Analysis & Solution, AmazonFresh: Rekindling the Online Grocery Market Balanced Scorecard Analysis & Solution, Store24 (A): Managing Employee Retention Balanced Scorecard Analysis & Solution, iPremier (A): Denial of Service Attack (Graphic Novel Version) Balanced Scorecard Analysis & Solution, IKEA's Global Sourcing Challenge: Indian Rugs and Child Labor (A) Balanced Scorecard Analysis & Solution, Alexander Bandelli (A) Balanced Scorecard Analysis & Solution, Grosvenor Park Balanced Scorecard Analysis & Solution, A Student's Dilemma: Rent or Buy? We have new and used copies available, in 1 editions - starting at $18.43. Balanced Scorecard - Vlastn cesta Other external business partners include, for example, the local subcontractors whose services Zara employs for simple, but labour-intensive steps of the production process such as sewing. The Fast Fashion system that Zara uses is heavily dependent on a constant exchange of information throughout every part of the supply chain. At the end of FY2013, the only shareholders with a relatively huge stake in Inditexs share capital, other than Inditex itself, were Partner 2006, S.L. 1.62%. The concept of BSCs was first introduced in 1992 by. Customer profitability and customer life time value Kaplan and Norton approach to organization performance is What you measure is what you get. - How do customers perceive Zara Inditex? According to by Robert S. Kaplan and David P. Norton , 85 percent of executive teams spent less than one hour per month discussing strategy, with 50 percent reporting that they spent virtually no time on strategy discussions. Business, government, and nonprofit organizations worldwide use the balanced scorecard system to: Break down intangible strategic vision into specific, actionable steps Get everyone focused on strategy Employees working in stores, i.e. 9, Issue 4, pp. But in 2002, it faces important questions concerning its future growth. Having started as a small fashion store in A Corua, Zara is now the flagship brand of Inditex, the biggest fashion retailer in the world. It balances financial measures with performance measures and objectives related to all other parts of the organisation. 8. Lack of review structure often Balance Scorecards are made by consultant and lacks a clear organization wide review structure. Balanced Scorecard also provides a base to build a metrics framework that is aligned and consistent. However, the factories in which the firm produces its most important garments are highly automated and thus only to a certain extent dependent on human labour. The case describes this value chain, concentrating on its operations and IT infrastructure. Caso Zara. Only basic items with minimal fashion content, such as T-shirts and lingerie, for which competition is likely to be on price are outsourced to third parties in low-cost countries, while more complicated items that depend on the latest fashion are produced in nearby company-owned factories (Kumar & Linguri, 2006). M. E. Porter, Competitive Strategy(New York: Free Press, 1980) The Balance Scorecard of each company varies based on the nature, size of the firm and industry it operates in. ***It is a broad analysis and not all factors are relevant to the company specific. At the time of the case, the company relies on an out-of-date operating system for its store terminals and has no full-time network in place across stores. Balanced Scorecard Basics - Balanced Scorecard Institute Moreover, Spain is still by far the most important market for Inditex and Zara, accounting for 19% of the groups total sales in FY2014 (Inditex, 2015). Balanced Scorecard Template 49-61. Tags: Organizational Performance, Supply Chain Performance, Supply chain performance in the apparel industry ZARA. The study aimed at fitting existing systems of key figures of organizations to the increasing complexity of the business world. PDF View metadata, citation and similar papers at core.ac.uk CORE Setelah Anda menyiapkan template blanaced scorecard, Anda dapat mulai mengisi bagian yang kosong. The Balanced ScorecardMeasures that Drive Performance Balanced scorecard Magazine Article Robert S. Kaplan David P. Norton What you measure is what you get. At EMBA PRO, we believe that Balanced Scorecard approach is highly efficient strategic tool to formulate a cohesive strategy. Further, this stakeholder group comprises franchise partners who ran 10.87% of Zara stores worldwide in FY2014 (Inditex, 2015). Andrew McAfee, Anders Sjoman, Vincent Dessain (2018), "Zara: IT for Fast Fashion Harvard Business Review Case Study. 3.2 Explanation and justification of strategy map, 4. These measures typically include the following categories of performance: A Quantified Kraljic Matrix The Balanced Scorecard, referred to as the BSC, is a framework to implement and manage strategy. A Balanced Scorecard (BSC) is a deeply integrated performance metric that help organizations identify internal problems and overcome them through effective planning, strategy, and executions. Kotler & Armstrong (2017) "Principles of Marketing Management Management", Published by Pearson Publications. Use it to: Facilitate effective and consistent communication because everyone speaks a shared language of metrics Drive focus around key requirements Facilitate reviews on a regular basis Ensure organizational alignment Your company's mission goes in the center of the strategy map, with all strategies ultimately helping to fulfill that vision. Moreover, when it comes to international brands, they also have to tackle the issue of geographic locations, different spending patterns and different demands that exist in every market. In the context of the draft BSC to be developed, however, the analysis shall focus on relatively aggregated stakeholder groups. The basic idea of the Balanced Scorecard (BSC) is to focus the organisation on performance measures and implementing the current strategy. The Balanced Scorecard is the process of organizations creating a set of internal metrics that will help them to assess their business performance in 4 key areas. The BSC comprises measures from financial, customer, internal processes and learning and growth perspectives. Systm Balanced Scorecard (dle i BSC) je jednm z nejkomplexnjch model strategickho systmu men vkonnosti. The balanced scorecard says that four sets of measurements are needed. Lastly, a superior price-performance ratio (SO 5) has a positive impact on revenue growth. The purpose of this article is to establish a framework with its related measures for the development of a balanced scorecard (BSC) for auditing firms. How to Create a Balanced Scorecard: 15 Steps (with Pictures) - wikiHow Revenue and/or value added per employee Claims and complaints handling More precisely, Zaras sales strategy is not to generate a high purchase volume per customer per visit, but to stimulate frequent purchases and thus realise a high accumulated purchase volume per customer over the course of a year (Kumar & Linguri, 2006). Development of a Draft Balanced Scorecard for Zara - GRIN Homepage > Catalog > Business economics > Miscellaneous Development of a Draft Balanced Scorecard for Zara Seminar Paper, 2015 24 Pages, Grade: 80.00/100.00 M M Marvin Mertens (Author) eBook for only US$ 17.99 Download immediately. Apart from production facilities, Zara operates a giant distribution centre in A Corua that ships approximately 2.5 million items per week and employs 800 people filling orders plus 400 temporary workers during peak seasons to keep lead times low (Ferdows et al., 2004). Some of the questions answered by Balance Scorecard Analysis of ZARA: Fast Fashion are -. BSC : Balanced Scorecard Restaurant Balanced Scorecard Template. The balanced scorecard is anchored on four perspectives, which include financial, business process, customer, and organizational capacity. Some of the Human Resources metrics that can be used in Balanced Scorecard approach are - Artinya, balanced scorecard memiliki peran penting dalam mengembangkan usaha atau bisnis ke depannya. New sales as a percentage of total sales The major fashion brands have taken in the fact that in order to keep their competitive advantage, in an environment where there are new competitors at every corner, the importance of recognizing what a consumer wants and responding quickly, is crucial. Our heritage and performance set the foundation for infinite possibilities, collaborations and positive impact to come. Zara has managed to implement a cross-functional operations strategy, along with its vertically-integrated supply chain that enables mass production under push control, leading to lower markdowns, higher profitability and value creation for shareholders in the short and long term. This is all about making good decisions and executing them well. Identifikasi tujuan strategis Anda. 2.3 Assessment of stakeholders power/interest levels and implications for draft BSC, 3. This group consists of a variety of different stakeholders. As a result of Zaras rather uncommon approach to managing its supply chain, the firms cost in some areas of its business are substantially higher than those of competitors. The Balanced Scorecard approach was first proposed by Robert S. Kaplan and David P. Norton in their January February 1992, Harvard Business Review article titled The Balanced ScorecardMeasures that Drive Performance. Development of a Draft Balanced Scorecard for Zara. These four perspectives / components of Balance Scorecard are . Accounting for their key role, Zara pays store managers an above-average salary and up to 100% of their salary in bonuses if they hit sales targets (Ruddick, 2014). Translating Strategy Into Goals and Metrics. In simple terms, it's a way of understanding how well the department or entire organization is doing - an alternate, or preferred, way to measure successful strategy implementation that . Strategic Planning Using the Balanced Scorecard Training Seminar Despite these impressive facts, Zaras success is by no means cast in stone. In 2001, CNN euphorically described Zara as a Spanish success story, and Daniel Piette, then-fashion director of LVMH1, praised the company as possibly the most innovative and devastating retailer in the world (CNN, 2001). Feel free to connect with us if you need business research. Regarding SO 4, continuously bringing new designs to market encourages customers to visit Zara stores frequently, and to constantly spend money on Zara products, thereby increasing sales. It enables entities to discover their shortcomings and come up with strategies to overcome them. The scorecard likewise incorporates the announcing recurrence, alongside a spending plan for the proposed projects. 2. We then dive into formulating actionable goals based on the strategy, good practices in creating metrics and setting objectives, and learn about . The first perspective in the balanced scorecard framework is the financial perspective. Balanced Scorecard Analysis, case solution, Balanced Scorecard Solution. Customers, who visit Zara stores at least four to five times more often per year than those of competitors (Ferdows et al., 2004; Kumar & Linguri, 2006; Buck, 2014), reportedly wait in front of stores before opening time on delivery days to be among the first to buy new designs (CNN, 2001). (1995) "Looking Inside for Competitive Advantage". ***It is a broad analysis and not all factors are relevant to the company specific. The balanced scorecard framework uses four perspectives: 1. PDF Balanced Scorecard - Chartered Institute of Management Accountants Timely delivery of goods and services Strategic redundancy in job skills (job-coverage ratio) One of the reasons for its longevity is that it has evolved over time. Learning and Growth. According to by Robert S. Kaplan and David P. Norton , 85 percent of executive teams spent less than one hour per month discussing strategy, with 50 percent reporting that they spent virtually no time on strategy discussions. Do the firm require to make either small tweaks or big changes in the internal processes to build of maintain sustainable competitive advantage. Balanced Scorecard Analysis & Solution, Studio Realty Balanced Scorecard Analysis & Solution. Over the past years Zara has perfected their Fast Fashion model, meaning that even though the average fashion retailers take 6 months to produce garments, Zara manages to do it in 3 weeks. At the end of FY2013, the group held approximately 59.37% of its share capital through its Board of Directors, which also includes Inditex founder Amancio Ortega (Inditex, 2014). Balanced scorecard - HBR - Harvard Business Review These subcontractors are usually small workshops for whom Zara is the primary customer (Ferdows et al., 2004). There is also room to add budget information for your projects. Thirteen . Moreover, the implications of this interest on the draft BSC to be developed shall be identified. Broadly there are four main components / features of Balance Scorecard. The name "balanced scorecard" is associated . Balanced Scorecard analysis of Zara Inditex is a comprehensive effort to integrate and align strategy and operations. Theoretically there are no great disadvantages of Balance Scorecard approach but in practices managers face a number of hurdles such as Published by HBR Publications. That is achieved by maintaining a strict control over their supply chain, and manages to fit the entire production process into a 10-to-15-day time frame. Secondly people lower down in the organization are more likely to be measured by the non-financial metrics so Balance Scorecard approach provides a good framework to not only include their efforts in overall strategy but also to communicate to them how their efforts is contributing to the overall strategy and success of Zara Inditex. # using dplyr to add a new variable while preserving existing data library(dplyr) # here we are assuming we found the appropriate rho value for the y attribute using # the same process as mentioned above psc % mutate(x_savf_score = savf_score(x_attribute, 1, 5, .653), y_savf_score = savf_score(y_attribute, 1, 10, .70)) psc ## # a tibble: 200 x 5 The BSC framework is based on the balance between leading and lagging indicators, which can respectively be thought of as the drivers and outcomes of your company goals. As of 2004, Zara purchased 40% of its fabric from Comditel, an Inditex firm, and its entire dyestuff from yet another Inditex firm. Balanced Scorecard - Overview, Four Perspectives Apart from these, the draft BSC should address the concerns of NGOs and other political actors (10), as they may theoretically influence customers both directly (indicated by the black arrow from concept 10 to concept 1) and indirectly through the media (indicated by the dashed black arrows from concept 10 to concept 11 and from concept 11 to concept 1) by expressing their positive or negative attitude towards Zaras performance with respect to CSR-related aspects.