The Global Strategies of Spanish Multinational Corporations: A Case Study of ZARA

Brouillard, Noelle

The Global Strategies of Spanish Multinational Corporations: A Case Study of ZARA

Persistent URL

http://hdl.handle.net/10456/34199

Author(s)

Brouillard, Noelle

Date Issued

April 19, 2013

Abstract

Spain has not been a well-known origin of multinational corporations. This study examines the reasons for the lack of Spanish multinational corporations (MNCs) in the global economy in relation to their global strategies. The focus of this study is on the Spanish MNC, Zara, which is part of a larger conglomerate group Inditex. Inditex’s global strategies are examined using Porter’s (1998) global strategy frameworks of configuration, coordination, and the diamond concept. Next, financial data from Inditex’s annual reports from 1998-2011 are used to evaluate the success of their global strategies. A comparison of Gap Inc. and Inditex suggests that the latter has achieved financial success over the past 13 years, while at the same time expanding into new global locations. In contrast, Gap Inc., has had difficulty sustaining high levels of net income, as well as difficulty competing effectively in the international marketplace. Finally, the second section of this study, through the use of the Spanish language, examines Spain’s culture and economic history during the dictatorship of Francisco Franco in order to explain the reasons for Spanish corporations’ late entrance into the global market. This examination includes an analysis of Spanish business practices within the film Las razones de mis amigos (2000) directed by Gerardo Herrero. Inditex’s ability to be a global success is both attributed to their unique business model and their ability to overcome the challenges posed by the Spanish economy.

Honors

Economics, 2013

First Reader(s)

Onyeiwu, Stephen Z.