Zara - The imminent Change

Fellow colleagues, I am writing to you to voice my opinion on regarding the presentation from our friends over at ECG yesterday. I was very pleased with the overall quality of the information they provided and I feel we have enough information to make a decision based of what we collected with our own data as well as their analysis. Following our short discussion to reflect quickly on what our thoughts were initially, I was certain that we would still have some of us on the fence but speaking for myself, I was sold on the option to upgrade.

Salgado, I know you feel very strongly with the first option of keeping DOS and not complicating business structure if it does not require it. I urge you to take into account what Alex had mentioned regarding his previous consulting experience with outdated immediate implementation processes. I was very concerned with this fact so I gave him a call to see if I can get some more monetary information regarding an emergency situation such as the one in question. What I learned was that the best part about the “problem” we have is that we have a lot of time. We don’t, in fact, need to upgrade, so what that means is we have a lot of time to plan. If we plan our costs implementation phase out we can incur the costs over a couple years and not feel the impact of the large costs so suddenly. On average, effective planning of a software implementation could save around $150,000. I had some of our guys from finance work on the numbers. We will be hit hard in the beginning stages and as mentioned, if faced with other unexpected variances we might have to consider issuing a notes to raise money. From a financial standpoint, it is not attractive, however, we expect positive return on investment in future years.

I am not arguing or disagreeing with the fact that DOS is in fact perfectly functioning software. There is no real immediate need to upgrade at the moment. Aside from the risks we are aware of including our supplier ending DOS products, inaccurate inventory valuation, and just simply pushing back the inevitable, I believe the most important thing for our success is what my MBA professor instilled in me that stuck with me, “ Change is the law of life and those who look only to the past are certain to miss the future”.

Please consider some of my thoughts before our next DOS upgrade meeting as we need to come to a conclusion soon on what we will do. Feel free to stop by my office if you would like to discuss any of my opinions in detail or would simply like to add to it.