Case study

Subject – International business

Subject code – MGT104-203

Submitted to – Dr. Himani Joshi

Submitted by – Sukhpreet Kaur
Student ID – A00152433

Case study IKEA’s uniqueness of the situation

Q1. What strategies and other approaches does IKEA follow that have
allowed the firm to become the world’s leading furniture retailer?
Ans. IKEA’s enterprise approach is constructed upon the IKEA concept. The
IKEA Concept begins off evolved with the concept of offering a variety of
domestic furnishing merchandise that can be low-cost to various people, now
no longer simply the few. It is executed with the aid of using combining
function, quality, layout, and value – usually with sustainability in mind. The
IKEA Concept exists in each part of the organization, from layout, sourcing,
packing, and dispensing to the enterprise model.
The following factors represent essential factors of the IKEA commercial
enterprise approach.
1. Offering the bottom expenses- Cost-effectiveness is one of the strong bases
of IKEA’s aggressive advantage. The worldwide furnishings store is capable of
providing low charges way to an aggregate of economies of scale and
technology integration into diverse enterprise processes.
2. Increasing the sort of merchandise- A great variety of merchandise
additionally belongs to the listing of IKEA’s aggressive advantages. There is
12000 merchandise throughout in IKEA portfolio and the corporation renews
its product variety launching about 2000 new merchandise each year. The
corporation is likewise growing its presence in the meals and catering
industries.
3. International marketplace growth method- The domestic development and
furnishing chain have historically engaged in new marketplace improvement
competitively. IKEA has 11 franchisees running in extra than 500 places in sixty-
three countries. Furthermore, The Swedish furnishings chain has long-time
period plans to set up its corporation presence in lots of growing countries.
4. Benefiting from strategic alliances- The international fixtures store
advantages from strategic alliances to the most extent. The formation of
strategic alliances is located in the middle of IKEA’s commercial enterprise
method. The listing of the maximum successful collaborations encompasses a
partnership with Apple to discover the opportunities of Augmented Reality as a
device for domestic furnishing, a partnership with LEGO for brand-spanking
new product improvement, and a partnership with Adidas in understanding
sharing approximately patron behavior. Experience and competency withinside
the formation of strategic alliances may be specified as one of the maximum
critical IKEA aggressive advantages.
Ques2.Describe IKEA’s organizational culture. How does it contribute to the
firm’s success?
Ans. The formation of an organizational lifestyle is a multi-step method that
calls for the joint paintings of the body of workers members, units, and
leadership. Building a fine organizational way of life proceeds in numerous
consecutive stages; however, the period and content material of every level is
one-of-a-kind for every enterprise. As for IKEA, the maximum critical part of
the company’s way of life comes from the identification of the founder, Ingvar
Kamprad. He has honestly described the organization’s project and values,
which have to end up being the center postulates for all IKEA employees.
Moreover, the business enterprise has constantly sought to convey those
values—which consist of modesty, simplicity, and manipulation over costs—to
its clients. Thus, each employee is a service of the propagated IKEA subculture,
which in flip bureaucracy the idea for the achievement of the enterprise as a
whole.
Organizational Culture Factors
As said by Schein, the center organizational way of life elements are
myths/stories, rituals, language, and symbols/artifacts. In IKEA’s case, the tale
of Ingvar Kamprad—a person who owned a small keep of necessities and
added to the village dwellers and later become capable of expanding it right
into a big and a hit worldwide organization—performs a key position
withinside the employer’s organizational way of life. Indeed, this history has
stimulated the various rituals hired via way of means of the enterprise.
Examples encompass the organization’s hiring approaches and the truth that
the constitutor makes systematic visits to test how the employer is functioning
in reality. Furthermore, language is any other one of another important factor
for IKEA. All of the goods presented to customers are named in Swedish, the
language to start with used in the organization. Moreover, symbolism
contributes to the organization’s tradition pretty powerfully. The decorations,
the shop settings, or even the homes themselves are acknowledged and
diagnosed by IKEA visitors. Each of those 4 elements is similarly sizable in
making IKEA’s company’s way of life strong.
Type of Organizational Culture
Bearing in thought the technological complexity and the volatile circumstance
of the environment, it may be advised that the organizational shape of IKEA
ought to have 3 corresponding tiers: horizontal, vertical, and spatial
complexities. For instance, vice presidents must be prone to the president of
the business enterprise. Further, all selections have to made be according to
control and prison requirements. Apart from that, accounting, HR, and
advertising ought to be interconnected and impact the overall performance
and approach of 1 any other.
Ques3.What strategic challenges does IKEA face going forward?
Ans. IKEA is one of the most important multinational agencies withinside the
global managing numerous products. The enterprise sells and designs
furnishings home equipment and domestic add-ons at a low-cost charge. Ikea
has over 3 hundred shops internationally playing the coolest call it has created
for itself. While they're one of the maximum worthwhile fixtures agencies
withinside the globe there are widespread demanding situations and threats
which have been triumphed over and nevertheless had to be tackled.
The fundamental demanding situations confronted by the agency at some
point during its boom level have been; producing attention in new countries,
being capable of meeting goal call via way of means of making sure that the
enterprise did now no longer incur losses, developing new clients, a
competition promoting the identical product at a less expensive fee and
getting new personnel who have been inclined to conform with the
corporation rules.
Generating recognition in a brand new USA is a completely costly mission
wherein you want specific strategies to assist the network understand IKEA as
an employer and the goods it sells. The maximum, not unusual place strategies
used have been TV and radio advertisements, sending entrepreneurs to the
markets to do the advertising one-on-one with the clients or the shoppers
withinside the network, and via way of means of setting up billboards and
posters around city areas. Due to its publicity in unique countries, they needed
to teach personnel who've been running with the corporation for numerous
years to study overseas languages to assist make bigger the organization