HomeResearch & Knowledgeback to HomeOperationsback to Research & KnowledgeZalando: A digital foundation for fashion supply chain successback to Operations

Case Study

Zalando: A digital foundation for fashion supply chain success

By Richard Markoff, David Schröder, Arnd Huchzermeier and Ralf W. Seifert

20 pages

November 2022

Order this case study

Reference: IMD-7-2401

By 2021 Zalando had become Europe’s largest pure player in online fashion. But the road to success had not always been smooth. Back in 2014, six years after it was founded, the Germany-based company was at a crossroads. With an impending initial public offering (IPO) and investors looking for results, the company was nowhere near being profitable. Zalando realized that to achieve profitability and market leadership, it would have to leverage advanced technology and develop a data-driven supply chain. So, with the innovative spirit of a start-up, it embraced the challenge of building internal digital tools and competencies to drive supply chain efficiencies. The online fashion supply chain had to wrestle with the same challenges of tight margins and high customer expectations familiar to all online retailers. However, the fashion industry faced other unique challenges – high SKU counts, high seasonality, relentless product turnover and frighteningly elevated return rates. By developing proprietary systems and machine learning tools, Zalando developed a responsive, flexible distribution network, trustworthy order promises and a sophisticated, holistic approach to returns management. Through a data-driven journey born out of a crisis, Zalando discovered that these capabilities not only delivered supply chain excellence and pioneering new innovative techniques but also helped to fulfill the company’s vision of providing endless choice, seamless convenience and a tailored digital experience to millions of customers across Europe.

Learning Objective

How a digital and data program can integrate with a company’s vision and objectives, and how this vision creates structural supply chain requirements.

The importance of key structural decisions such as which supply chain competencies are considered core to the company’s mission.

How to foster a data-driven mindset across a supply chain organization.

The complexity of online fashion supply chains and how data can be leveraged to tackle this.

The emerging importance of sustainability in fast fashion.

Keywords

Operations, Digital Transformation, eCommerce, Supply Chain, Fast Fashion, Digital Technology, Big Data, Distribution, Digital

Settings

Europe, Germany
Zalando, Information Technology, eCommerce, Consumer Goods, Apparel and Fashion
2012-2021

Type

Field Research

Available Languages

English

Related material

Teaching note, Video

IMD case studies are distributed through case clearing houses. In order to browse the collection and purchase copies please visit the links below.

The Case Centre

Cranfield University

Wharley End Beds MK43 0JR, UK
Tel +44 (0)1234 750903
Email [email protected]

Harvard Business School Publishing

60 Harvard Way, Boston MA 02163, USA
Tel (800) 545-7685 Tel (617)-783-7600
Fax (617) 783-7666
Email [email protected]

Asia Pacific Case Center

NUCB Business School

1-3-1 Nishiki Naka
Nagoya Aichi, Japan 460-0003
Tel +81 52 20 38 111
Email [email protected]

IMD retains all proprietary interests in its case studies and notes. Without prior written permission, IMD cases and notes may not be reproduced, used, translated, included in books or other publications, distributed in any form or by any means, stored in a database or in other retrieval systems. For additional copyright information related to case studies, please contact Case Services.

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Best-selling Case Study

Keep reading

Case Study

NTT at a crossroads (A): Quest for growth

Strategy General Management Digital Disruption

By Patrick Reinmoeller

Case Study

NTT at a crossroads (B): Mapping growth options

Strategy General Management Digital Disruption

By Patrick Reinmoeller

Article

Unlocking value in manufacturing by taking continuous improvement to the next level

Manufacturers must adopt a unified strategy across different divisions if they are to extract the full value of Industry 4.0. 

Supply Chain Value Creation

By Ralf W. Seifert and Vasilis Karamalegos

in I by IMD

9 December 2024

Case Study

DBS (A): “Damn bloody slow” to best digital bank in the world

Customer Centricity Digital Organizational Change Organizational Design

By Seán Meehan, Goutam Challagalla and Pallivathukkal Cherian Abraham

Case Study

DBS (B): Managing through customer journeys

Customer Centricity Digital Organizational Change Organizational Design

By Seán Meehan, Goutam Challagalla and Pallivathukkal Cherian Abraham

Article

How the UAE is moving towards an AI-driven, knowledge-based economy

The UAE has been making waves recently in the technology world. A $1.5 billion deal between American tech giant Microsoft and Abu Dhabi’s AI champion, G42, is a bold move to boost the UAE’s technology clout, especially in artificial intelligence. ...

Artificial Intelligence Economics Digital Business Transformation

By Arturo Bris

in The National

23 November 2024

Article

Navigating crisis through digitalisation and its impact on firm formality: The case of microenterprises in India

Purpose Using an institutional lens and drawing on the arguments of the external enabler perspective, this study aims to examine the role of digital technology adoption on the performance of microenterprises, with a focus on their level of formal...

Digital Technology Management

By Muhammad Shehryar Shahid, Esther Salvi and Mehak Sajjad

in International Journal of Sociology and Social Policy

19 November 2024, ePub before print, https://doi.org/10.1108/IJSSP-08-2024-0390

Article

EXPRESS: Balancing resilience and efficiency: A literature review on overcoming supply chain disruptions

The supply chain risk management literature differentiates between disruption risk that arises from supply disruptions to normal activities and recurrent risk that arises from problems in coordinating supply and demand in the absence of disruption...

Supply Chain Resilience

By Florian Lücker, Anna Timonina-Farkas and Ralf W. Seifert

in Production and Operations Management

16 November 2024, ePub before print, https://doi.org/10.1177/10591478241302735

Report

IMD World Digital Competitiveness Ranking 2024: The digital divide: Risks and opportunities

Now in its eighth year, the 2024 IMD World Digital Competitiveness Ranking measures the capacity and readiness of 67 economies to adopt and explore digital technologies as a key driver for economic transformation in business, government, and wider...

Digital Technology Management Competitiveness

By Arturo Bris, José Caballero, Christos Cabolis, Francesca De Nicola and William Milner

IMD World Competitiveness Center Report, 14 November 2024, 8th edition

Case Study

Mastercard 2023: Rewired for infinite optionality

In the 2010s, card processing – Mastercard’s flagship service – started showing signs of commodification as new, nimble players (typically, fintech startups thriving on digital) entered the payment processing space, and customer preferences evolve...

Disruption Digital Strategy

By Howard H. Yu, Mark J. Greeven and Martin Králik

NTT at a crossroads (A): Quest for growth

By Patrick Reinmoeller
Case reference: IMD-7-2351 ©2024

Summary

NTT Corporation, Japan’s information and communication technologies (ICT) leader since 1953, was the first to commercialize internet usage on mobile phones in the 1990s, which resulted in NTT achieving much success in Japan. However, by the end of the 2000s, Japan faced challenges with an aging population and a stagnant economy. Recognizing disruption in the ICT sector, CEO Satoshi Miura understood the need for the dominant players in the ICT industry to integrate emerging business domains beyond their existing frameworks. To secure leading global positions in ICT and the new paradigm of cloud computing, Miura needed to make strategic choices to revive growth. Case A provides information on NTT, its rivals, the global market and cloud computing disruptions. The case ends with NTT’s CEO exploring strategic growth options to prepare NTT for the future.

Reference IMD-7-2351

Organization Nippon Telegraph and Telephone

Industry Services, Telecommunications;Information Technology

Available Languages English

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Strategy

General Management

Digital

Disruption

Browse all topics

Related content

Case Study

NTT at a crossroads (B): Mapping growth options

Strategy General Management Digital Disruption

By Patrick Reinmoeller

NTT at a crossroads (B): Mapping growth options

By Patrick Reinmoeller
Case reference: IMD-7-2352 ©2024

Summary

Building on NTT (A), the case starts with NTT’s CEO having narrowed down strategic growth options with the board to prepare NTT for the future. Past international investments in AT&T Wireless and KPN to tap into foreign markets had resulted in billion $ write offs and stopped international acquisitions. However, after reviewing the disruptive changes facing the ICT industry and considering the shareholders’ views, CEO Miura committed to internationalization. The B case details NTT’s growth strategy focused on internationalization, while considering the need for new capabilities and technologies. It provides more insights into NTT, its opportunities and the Japanese experience with M&As and ends with Miura’s determination to quickly grow through international expansion to prepare NTT for the future.

Reference IMD-7-2352

Organization Nippon Telegraph and Telephone

Industry Services, Telecommunications;Information Technology

Available Languages English

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Strategy

General Management

Digital

Disruption

Browse all topics

Related content

Case Study

NTT at a crossroads (A): Quest for growth

Strategy General Management Digital Disruption

By Patrick Reinmoeller

DBS (A): “Damn bloody slow” to best digital bank in the world

By Seán Meehan Goutam Challagalla and Pallivathukkal Cherian Abraham
Case reference: IMD-7-2633 ©2024

Summary

Since becoming DBS Bank’s CEO in 2009, Piyush Gupta led its transformation to become a standard setter globally for digitalization and customer centricity in financial services. This transformation started with fixing the basics (2009-2014), in which DBS implemented consistent systems and processes across the bank and used five-day process improvement events to fix customer journeys. DBS then began benchmarking with tech leaders (2014 onwards), which led it to build a middleware layer on top of its core banking platform to allow it to develop and launch new products rapidly, implement straight-through processing so that most transactions could be completed digitally and instantly, and move data and applications to the cloud. The next phase of the transformation was two-in-a-box (2018 onwards). DBS reorganized its businesses and key functions into 33 platforms to become more agile. Platforms were organized based on key businesses or key shared or support functions. Each platform was co-led by a business lead and a technology lead who were empowered to do what was required to achieve the desired outcomes. As Gupta looked back in early 2021, he was pleased with the progress that DBS had made since 2009. At the same time, he knew there was no room for complacency. This was especially true in Singapore where its two major local competitors had upped their game, and the government had issued digital banking licenses to potentially formidable new competitors. The bank’s executive committee resolved to do whatever was necessary to further enhance the bank’s customer centricity. It considered the three classical avenues for doing so: organizing around customer segments, implementing new ways of working using agile teams and a horizontal organization and focusing on culture and principles. Making the right choice would be crucial to the bank’s continued success.

Reference IMD-7-2633

Organization Development Bank of Singapore

Industry Finance and Insurance, Banking

Available Languages English

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Customer Centricity

Digital

Organizational Change

Organizational Design

Browse all topics

Related content

Case Study

DBS (B): Managing through customer journeys

Customer Centricity Digital Organizational Change Organizational Design

By Seán Meehan, Goutam Challagalla and Pallivathukkal Cherian Abraham

DBS (B): Managing through customer journeys

By Seán Meehan Goutam Challagalla and Pallivathukkal Cherian Abraham
Case reference: IMD-7-2634 ©2024

Summary

To stay ahead of competitors, DBS knew it needed to continue to innovate and improve customer centricity. To do so, it decided to move to a horizontal organizational structure, an approach it named Managing Through Journeys (MtJs). This involved bringing together representatives from all functions that touched the customer journey from the beginning to the end. This would allow DBS to deliver a more seamless and integrated customer experience. The bank introduced a few pilot MtJs in 2021. By 2024, more than 60 MtJs were in operation, accounting for over 60% of the bank’s revenues. The MtJs had nine elements, which collectively led to a new way of working. Three foundational elements provided the initial momentum and specified how to measure impact. These were performance cells, cross-functional teams focused on a specific product or customer segment; performance management architecture, which specified the common set of KPIs for each performance cell; and performance development and compensation, which enabled MtJ members to be evaluated and rewarded for their contributions. Six interconnected elements created a flywheel effect for continuous improvement. These were the value map and control tower, which mapped the relationship between levers, drivers and outcomes; customer obsession, which drove customer research; experimentation using a structured approach; artificial intelligence/machine learning to create faster feedback loops; innovation using a structured approach to accelerate the ideation and production process; and workflow workbench which ensured information flowed seamlessly across all performance cell members. The move to MtJs allowed DBS to stay on top of the customer service rankings in Singapore’s banking sector The operational improvements from the bank’s transformation improved the bank’s business performance significantly. The bank’s leadership knew that keeping the customer front of mind would need to be an ongoing priority.

Reference IMD-7-2634

Organization Development Bank of Singapore

Industry Finance and Insurance, Banking

Available Languages English

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Customer Centricity

Digital

Organizational Change

Organizational Design

Browse all topics

Related content

Case Study

DBS (A): “Damn bloody slow” to best digital bank in the world

Customer Centricity Digital Organizational Change Organizational Design

By Seán Meehan, Goutam Challagalla and Pallivathukkal Cherian Abraham

How the UAE is moving towards an AI-driven, knowledge-based economy

By Arturo Bris
in The National 23 November 2024

Summary

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Artificial Intelligence

Economics

Digital

Business Transformation

Browse all topics

Navigating crisis through digitalisation and its impact on firm formality: The case of microenterprises in India

By Muhammad Shehryar Shahid Esther Salvi and Mehak Sajjad
in International Journal of Sociology and Social Policy 19 November 2024, ePub before print, https://doi.org/10.1108/IJSSP-08-2024-0390

Summary

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Digital

Technology Management

Browse all topics

EXPRESS: Balancing resilience and efficiency: A literature review on overcoming supply chain disruptions

By Florian Lücker Anna Timonina-Farkas and Ralf W. Seifert
in Production and Operations Management 16 November 2024, ePub before print, https://doi.org/10.1177/10591478241302735

Summary

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Supply Chain

Resilience

Browse all topics

IMD World Digital Competitiveness Ranking 2024: The digital divide: Risks and opportunities

By Arturo Bris José Caballero Christos Cabolis Francesca De Nicola and William Milner
IMD World Competitiveness Center Report, 14 November 2024, 8th edition

Summary