A thoughtful post on the nature of innovation, relative to globalisation, making the point that while the world appears global, the reality is quite local for effective innovation. The innovation levers technology and communication for the global aspects.
One example is Zara. Based on NW Spain, they have developed a global strategy of successful stores, but the innovation is centred in Galicia.
Irving Wladawsky-Berger
On average, it takes nine months to develop a new fashion product and get it into stores. Zara is able to shrink that number to a remarkable four to five weeks. Consequently, it can assess in real time how well its products are doing in its stores around the world and take action accordingly. If after a week a product is not selling well, it is withdrawn from the stores and the orders are cancelled. On the other hand, if a product proves hot, production is ramped up, and variations on its design are quickly pursued.
Some points of note on Zara’s strategy;
- they reduced production cycyle from 9 months to 4 weeks
- local receptivity on new designs is gathered real time from all stores back to Galicia
- design is all in house in Galicia
- actual production is local near the individual stores
- all communication is network based
