In every level of business, technology is an integral element in creating and sustaining a competitive advantage. The use of the latest information systems can allow a firm increased functionality and profit margins if utilized correctly. As it has advanced, technology has become much more affordable for businesses to implement into their plan.
Technology can often be the essential difference between a business that is experiencing swift growth and another that is experiencing decline. Such is the case of Zara and the GAP. Zara is a rapidly expanding. It spends 5-10 less on technology than its rivals, and has a greater return on their investment. They keep inventory to a minimum and bring in 12,000 fresh item designs a year. The constant change of their items keeps customers coming back, as there is always something new in the store. An idea can be found on a store shelf in only 15 days time. GAP, on the other hand, takes risks by guessing the styles for each season. This is a high risk process, because if they guess wrong they could take huge lasses for that quarter.
One of the largest department store chains, Macy’s, has recently adopted a brand of technology to enhance its ability to provide goods the consumers desire in an efficient manner. The technology they are adopting is called Radio-Frequency Identification (RFID). Originally created to identify friendly aircraft in World War II, RFID has been repurposed and applied to merchandise as the costs of the technology have decreased. To use this, Macy’s has to install the RFID technology in its stores and chips into its garments. They are beginning installing RFID in the shoe department, and planning to expand its use storewide gradually over the next couple of years.
The RFID technology will allow Macy’s several advantages. First, it will provide a fast, detailed list of inventory and reduce stock-outs and overstocks. It will also allow Macy’s to track its merchandise through the supply chain and enhance security of goods. Additionally, the RFID technology will enhance Macy’s customer service by allowing them to quickly check inventory from stores nationwide and ship the item directly to the customer’s home. In this way, Macy’s will be integrating their stores and online shopping. Sales associates will be able to sell products that are out of stock at the store and increase customer satisfaction.
As is often the case, this technology is a double-edged sword. There is concern that RFID risks the privacy of the consumer, as it could be used as a consumer profiler and tracker. However, the implementation plan designed by Macy’s makes it extremely low risk for the consumer’s privacy while upgrading efficiency and overall shopping experience considerably.