IKEA is the world's largest furniture retailer known for its Scandinavian style flat-pack furniture. It has over 250 stores worldwide and offers around 9,500 products. IKEA uses a SWOT analysis to help achieve its sustainability goals. Some of IKEA's strengths that help it pursue sustainability include its global brand, vision of better lives for many, and strategic use of materials. IKEA sees opportunities in growing demand for greener products and focuses on solutions for sustainable living, resource use, and social responsibility.
The presentation analyses IKEA's Business Model as a cost leadership. How can IKEA win over other furniture competitors to become one of leading companies and distribute their products all over all world ? Let's take a quick look
The Amazing Digital Transformation Of IKEA: Virtual Reality, Apps & Self-Driv...Bernard Marr
Swedish furniture giant IKEA is changing products, services and investments to be more competitive and relevant in the digital age. They are in the midst of a digital transformation that should make the company more appealing to a broader customer base. From AR apps that allow customers to “try” products in their home to the Space10 innovation lab, IKEA recognizes they must adapt to what consumers want and need in the future.
SWOT analysis is a strategic planning technique used to help a person or organization identify strengths, weaknesses, opportunities, and threats related to business competition or any project planning.
The project analyses the importance of branding for Ikea and can help us to find out about IKEA's SWOT analysis and the STP process for Ikea. It also gives information on Ikea's Vision and Mission and Ikea's Marketing Mix, Ikea's Pestle Analysis, Ikea's Five Forces Model, Ikea's History and Ikea's Products and Services.
This slide was prepared by me, for my term paper presentation on IKEA's operations management.
Slide comprises of a brief company overview with its mission & vision, global outlet locations, product lines, key aspects of operation functions, swot and conclusion.
All information were collected from secondary sources.
This case is derived from the London Times site for Business Teach.docxchristalgrieg
This case is derived from the London Times site for Business Teachers. The case provides a detailed description of a real-life business problem, the solution that was implemented, and the impact that this solution had on the business. Each student will prepare a 6-8 page paper with the following sections:
· Abstract: Summary of the entire paper in a single paragraph.
· Background: Summary of the problem situation covered in the case
·
Solution
: Summary of the solution that was implemented (actions taken by the business).
· How does the case relate to the course content? (Refer specifically to textbook references in this portion and include three excel charts.)
· Conclusion: What conclusions can be drawn from this case study? (This portion should include independent analysis and indicate an ability to draw general principles from a specific example.)
· All papers must be typed, no handwritten papers.
· All papers must have your name, date and title
· Proper APA format
· https://owl.english.purdue.edu/owl/resource/560/01/
Introduction
It is easy to think about the present without considering the future. Consumers want more
goods and services to improve their standard of living. The problem is they make choices
about goods and services that have long-term consequences for the environment. In our
modern world, organisations need to show responsibility. This means that they use resources
efficiently, do not harm the environment and consider how what they do affects the ability of
future generations to meet their needs.
IKEA aims to be a responsible organisation. It sells low-price home furnishing products
around the world. These include furniture and accessories for kitchens, bedrooms, living
rooms, bathrooms and children’s rooms. IKEA now has stores in 36 countries around the
world. It has come a long way in its 60 years of business.
The direction for the organisation is provided by its vision. This acts as a guide for
everybody within and outside the organisation about what IKEA wants to achieve. IKEA’s
vision is ‘To create a better everyday life for the many people.’ To meet this vision IKEA
provides many well-designed, functional products for the home. It prices its products low so
that as many people as possible can afford to buy them.
However, in creating low prices IKEA is not willing to sacrifice its principles. ‘Low price but
not at any price’ is what IKEA says. This means it wants its business to be sustainable.
IKEA supplies goods and services to individuals in a way that has an overall beneficial effect on
people and the environment. Customers all over the world have responded positively to IKEA’s
approach. This is evident in its increasing sales. In 2006 IKEA had a group turnover of nearly
18 billion euros.
81
Building a sustainable supply chain
www.thetimes100.co.uk
IK
E
A
CURRICULUM TOPICS
• Supply chain
• Primary sector of industry
• Secondary sector of industry
• Tertiary sector of industry
GLOSSARY
Vision: the s ...
The presentation analyses IKEA's Business Model as a cost leadership. How can IKEA win over other furniture competitors to become one of leading companies and distribute their products all over all world ? Let's take a quick look
The Amazing Digital Transformation Of IKEA: Virtual Reality, Apps & Self-Driv...Bernard Marr
Swedish furniture giant IKEA is changing products, services and investments to be more competitive and relevant in the digital age. They are in the midst of a digital transformation that should make the company more appealing to a broader customer base. From AR apps that allow customers to “try” products in their home to the Space10 innovation lab, IKEA recognizes they must adapt to what consumers want and need in the future.
SWOT analysis is a strategic planning technique used to help a person or organization identify strengths, weaknesses, opportunities, and threats related to business competition or any project planning.
The project analyses the importance of branding for Ikea and can help us to find out about IKEA's SWOT analysis and the STP process for Ikea. It also gives information on Ikea's Vision and Mission and Ikea's Marketing Mix, Ikea's Pestle Analysis, Ikea's Five Forces Model, Ikea's History and Ikea's Products and Services.
This slide was prepared by me, for my term paper presentation on IKEA's operations management.
Slide comprises of a brief company overview with its mission & vision, global outlet locations, product lines, key aspects of operation functions, swot and conclusion.
All information were collected from secondary sources.
This case is derived from the London Times site for Business Teach.docxchristalgrieg
This case is derived from the London Times site for Business Teachers. The case provides a detailed description of a real-life business problem, the solution that was implemented, and the impact that this solution had on the business. Each student will prepare a 6-8 page paper with the following sections:
· Abstract: Summary of the entire paper in a single paragraph.
· Background: Summary of the problem situation covered in the case
·
Solution
: Summary of the solution that was implemented (actions taken by the business).
· How does the case relate to the course content? (Refer specifically to textbook references in this portion and include three excel charts.)
· Conclusion: What conclusions can be drawn from this case study? (This portion should include independent analysis and indicate an ability to draw general principles from a specific example.)
· All papers must be typed, no handwritten papers.
· All papers must have your name, date and title
· Proper APA format
· https://owl.english.purdue.edu/owl/resource/560/01/
Introduction
It is easy to think about the present without considering the future. Consumers want more
goods and services to improve their standard of living. The problem is they make choices
about goods and services that have long-term consequences for the environment. In our
modern world, organisations need to show responsibility. This means that they use resources
efficiently, do not harm the environment and consider how what they do affects the ability of
future generations to meet their needs.
IKEA aims to be a responsible organisation. It sells low-price home furnishing products
around the world. These include furniture and accessories for kitchens, bedrooms, living
rooms, bathrooms and children’s rooms. IKEA now has stores in 36 countries around the
world. It has come a long way in its 60 years of business.
The direction for the organisation is provided by its vision. This acts as a guide for
everybody within and outside the organisation about what IKEA wants to achieve. IKEA’s
vision is ‘To create a better everyday life for the many people.’ To meet this vision IKEA
provides many well-designed, functional products for the home. It prices its products low so
that as many people as possible can afford to buy them.
However, in creating low prices IKEA is not willing to sacrifice its principles. ‘Low price but
not at any price’ is what IKEA says. This means it wants its business to be sustainable.
IKEA supplies goods and services to individuals in a way that has an overall beneficial effect on
people and the environment. Customers all over the world have responded positively to IKEA’s
approach. This is evident in its increasing sales. In 2006 IKEA had a group turnover of nearly
18 billion euros.
81
Building a sustainable supply chain
www.thetimes100.co.uk
IK
E
A
CURRICULUM TOPICS
• Supply chain
• Primary sector of industry
• Secondary sector of industry
• Tertiary sector of industry
GLOSSARY
Vision: the s ...
How standardization benefits a business process and commercialisation?
What has allowed IKEA to be successful with a relatively standardised product and product line?
How does the experiential marketing approach help improve sales in Ikea?
Which features of ‘young people of all ages’ are universal and can be exploited by a global/regional strategy?
How does Corporate Social Responsibility (CSR) attract customers?
How does IKEA adapt its strategy for competing in international markets?
IKEA’s Social Initiative was created to manage the company’s social involvements on a global level. Why?
This case study is about a multinational company which sells ready to assemble furniture and home accessories. According to the economics records as at 2008 this is the world largest furniture retailer. (Forbes, 2013)
This report describes about the main strategies which IKEA use to approach to different markets with different consumers and with them IKEA has evolved into the largest furniture retailer in the world with approximately 300 stores in 38 countries and revenues topping $21.5 billion in 2009. Its top countries in terms of sales include Germany, 16 percent; United States, 11 percent; France, 10 percent; United Kingdom, 7 percent; and Italy, 7 percent. (Business week, 2005)
According to the final decision IKEA has made a different way of shop for furniture with the time develops and it has reach to the expectations of its customers according to their expectations.
Finally, in the conclusion of the report shows the final view of the researcher about the finding regarding to the IKEA strategies throughout the research and final judgment which make about the given case.
Global Strategy andOrganizationGlobal Strategy andOrgani.docxwhittemorelucilla
Global Strategy and
Organization
Global Strategy and
Organization
c h a p t e r
Learning Objectives
In this chapter, you will
learn about:
> IKEA’s Global Strategy
Furniture retailer IKEA is a Swedish company that has transformed itself into a
global organization over the past three decades. Ingvar Kamprad founded the firm
in Sweden in 1943 when he was 17 years old. IKEA originally sold pens, picture
frames, jewelry, and nylon stockings—any product that Kamprad could sell at a low
price. In 1950, IKEA began selling furniture and housewares. In the 1970s, the
company began expanding into Europe and North America. IKEA’s philosophy is to
offer quality, well-designed furnishings at low prices. The company designs “knock-
down” furniture that the customer purchases and then assembles at home. Designs
implement functional, utilitarian, and space-saving features, with a distinctive Scan-
dinavian style.
IKEA Group sales for the fiscal year 2006 totaled 17.3 billion euros, mak-
ing IKEA the largest furniture retailer in the world. Its stores, usually located in
major cities, are mammoth, warehouse-style outlets, with each stocking approxi-
mately 9,500 items, including everything for the home—from sofas to plants to
kitchen utensils.
IKEA is now owned by a Dutch-registered foundation controlled by the Kam-
prad family. Its corporate offices are in the Netherlands, Sweden, and Belgium.
11
312
1. The role of strategy in
international business
2. The integration-responsiveness
framework
3. Distinct strategies emerging
from the integration-
responsiveness framework
4. Organizational structure
5. Alternative organizational
arrangements for international
operations
6. Building the global firm
7. Putting organizational change in
motion
CAVUMC11_312-343hr 10/15/07 11:26 AM Page 312
Product development, purchasing, and warehousing are concentrated in Sweden.
Headquarters designs and develops IKEA’s global product line and branding, often
in close collaboration with external suppliers. Approximately 30 percent of the mer-
chandise is made in Asia, and two-thirds in Europe. A few items are sourced in
North America to address the specific needs of that market, but 90 percent of IKEA’s
product line is identical worldwide. Managers at IKEA stores feed market research
back to headquarters in Sweden on sales and customer preferences.
IKEA targets people all over the world, with a focus on families with limited
income and limited living space. This global segment is characterized by liberal-
minded, well-educated, white-collar people—including college students—who care
little about status and view foreign products positively. Targeting a global customer
segment allows IKEA to offer standardized products at uniform prices, a strategy
that minimizes the costs of international operations. IKEA seeks scale economies by
consolidating worldwide design, purchasing, and manufacturing. It distinguishes
itself from conventional furniture makers that s ...
Firm Strategy for Global or Multi-domestic OrganizationsAssignment Studio
Firms are utilizing and adopting several strategies as per nature of their business to accomplish mission and vision. In this report, several global strategies have been explored and the applications and practical implications have also been compared with a global firm. The operations of IKEA have been studied to see the outcomes of global strategy in its operations.
Q1: What was the source of IKEA’s Competetive advantage at that time?
Q.2 IKEA’s expansion into Europe
Q.3 IKEA’s strategy prior to its missteps in North America.
Q4. IKEA’s strategy towards its suppliers
شركة جلوبال امبكس – مصر ” الوكيل الحصري لميديكال كارد داخل جمهورية مصر العربية.
تعتبر شركة ميديكال كارد للرعاية الطبية احدى شركات المجموعة المصرية الأماراتية.
ميديكال كارد هو اكبر كارت خصومات طبية فى مصر.
ميديكال كارد يحتوى على شبكة من اكتر من 500 مكان متنوع من مستشفيات و عيادات و مراكز اشعة و معامل تحاليل و يقدم قسائم مجانية ب 40000جنية.
ميديكال كارد هو افضل كارت تأمين طبى فى مصر.
Digital Money Maker Club – von Gunnar Kessler digital.focsh890
Title One is a comprehensive examination of the impact of digital technologies on
modern society. In a world where technology continues to advance rapidly, this article delves into the nuances and complexities of the digital age, exploring Its implications across various sectors and aspects of life.
It's another new era of digital and marketers are faced with making big bets on their digital strategy. If you are looking at modernizing your tech stack to support your digital evolution, there are a few can't miss (often overlooked) areas that should be part of every conversation. We'll cover setting your vision, avoiding siloes, adding a democratized approach to data strategy, localization, creating critical governance requirements and more. Attendees will walk away with actions they can take into initiatives they are running today and consider for the future.
Top 3 Ways to Align Sales and Marketing Teams for Rapid GrowthDemandbase
In this session, Demandbase’s Stephanie Quinn, Sr. Director of Integrated and Digital Marketing, Devin Rosenberg, Director of Sales, and Kevin Rooney, Senior Director of Sales Development will share how sales and marketing shapes their day-to-day and what key areas are needed for true alignment.
How to Run Landing Page Tests On and Off Paid Social PlatformsVWO
Join us for an exclusive webinar featuring Mariate, Alexandra and Nima where we will unveil a comprehensive blueprint for crafting a successful paid media strategy focused on landing page testing.With escalating costs in paid advertising, understanding how to maximize each visitor’s experience is crucial for retention and conversion.
This session will dive into the methodologies for executing and analyzing landing page tests within paid social channels, offering a blend of theoretical knowledge and practical insights.
The Pearmill team will guide you through the nuances of setting up and managing landing page experiments on paid social platforms. You will learn about the critical rules to follow, the structure of effective tests, optimal conversion duration and budget allocation.
The session will also cover data analysis techniques and criteria for graduating landing pages.
In the second part of the webinar, Pearmill will explore the use of A/B testing platforms. Discover common pitfalls to avoid in A/B testing and gain insights into analyzing A/B tests results effectively.
Search Engine Marketing - Competitor and Keyword researchETMARK ACADEMY
Over 2 Trillion searches are made per day in Google search, which means there are more than 2 Trillion visits happening across the websites of the world wide web.
People search various questions, phrases or words. But some words and phrases are searched
more often than others.
For example, the words, ‘running shoes’ are searched more often than ‘best road running
shoes for men’
These words or phrases which people use to search on Google are called Keywords.
Some keywords are searched more often than others. Number of times a keyword is searched
for in a month is called keyword volume.
Some keywords have more relevant results than others. For the phrase “running shoes” we
get more than 80M relevant results, whereas for “best road running shoes for men” we get
only 8.
The former keyword ‘running shoes’ has way more competition from popular websites to
new and small blogs, whereas the latter keyword doesn’t have that much competition. This
search competition for a keyword is called search difficulty of a keyword or keyword
difficulty.
In other words, if the keyword difficulty is ‘low’ or ‘easy’, there won’t be any competition
and if you target such keywords on your site, you can easily rank on the front page of Google.
Some keywords are searched for, just to know or to learn some information about something,
that’s their search intention. For example, “What shoe size should I choose?” or “How to pick
the right shoe size?”
These keywords which are searched just to know about stuff are called informational
keywords. Typically people who are searching this type of keywords are top of a Conversion
funnel.
Conversion funnel is the journey that search visitors go through on their way to an email
subscription or a premium subscription to the services you offer or a purchase of products
you sell or recommend using your referral link.
For some buyers, research is the most important part when they have to buy a product.
Depending on that, their journey either widens or narrows down. These types of buyers are
Researchers and they spend more time with informational keywords.
Conversion is the action you want from your search visitors. Number of conversions that you
get for every 100 search visitors is called Conversion rate.
People who are at different stages of a conversion funnel use different types of keywords.
The session includes a brief history of the evolution of search before diving into the roles technology, content, and links play in developing a powerful SEO strategy in a world of Generative AI and social search. Discover how to optimize for TikTok searches, Google's Gemini, and Search Generative Experience while developing a powerful arsenal of tools and templates to help maximize the effectiveness of your SEO initiatives.
Key Takeaways:
Understand how search engines work
Be able to find out where your users search
Know what is required for each discipline of SEO
Feel confident creating an SEO Plan
Confidently measure SEO performance
In this presentation, Danny Leibrandt explains the impact of AI on SEO and what Google has been doing about it. Learn how to take your SEO game to the next level and win over Google with his new strategy anyone can use. Get actionable steps to rank your name, your business, and your clients on Google - the right way.
Key Takeaways:
1. Real content is king
2. Find ways to show EEAT
3. Repurpose across all platforms
Come learn how YOU can Animate and Illuminate the World with Generative AI's Explosive Power. Come sit in the driver's seat and learn to harness this great technology.
The digital marketing industry is changing faster than ever and those who don’t adapt with the times are losing market share. Where should marketers be focusing their efforts? What strategies are the experts seeing get the best results? Get up-to-speed with the latest industry insights, trends and predictions for the future in this panel discussion with some leading digital marketing experts.
Most small businesses struggle to see marketing results. In this session, we will eliminate any confusion about what to do next, solving your marketing problems so your business can thrive. You’ll learn how to create a foundational marketing OS (operating system) based on neuroscience and backed by real-world results. You’ll be taught how to develop deep customer connections, and how to have your CRM dynamically segment and sell at any stage in the customer’s journey. By the end of the session, you’ll remove confusion and chaos and replace it with clarity and confidence for long-term marketing success.
Key Takeaways:
• Uncover the power of a foundational marketing system that dynamically communicates with prospects and customers on autopilot.
• Harness neuroscience and Tribal Alignment to transform your communication strategies, turning potential clients into fans and those fans into loyal customers.
• Discover the art of automated segmentation, pinpointing your most lucrative customers and identifying the optimal moments for successful conversions.
• Streamline your business with a content production plan that eliminates guesswork, wasted time, and money.
Digital Commerce Lecture for Advanced Digital & Social Media Strategy at UCLA...Valters Lauzums
E-commerce in 2024 is characterized by a dynamic blend of opportunities and significant challenges. Supply chain disruptions and inventory shortages are critical issues, leading to increased shipping delays and rising costs, which impact timely delivery and squeeze profit margins. Efficient logistics management is essential, yet it is often hampered by these external factors. Payment processing, while needing to ensure security and user convenience, grapples with preventing fraud and integrating diverse payment methods, adding another layer of complexity. Furthermore, fulfillment operations require a streamlined approach to handle volume spikes and maintain accuracy in order picking, packing, and shipping, all while meeting customers' heightened expectations for faster delivery times.
Amid these operational challenges, customer data has emerged as an important strategy. By focusing on personalization and enhancing customer experience from historical behavior, businesses can deliver improved website and brand experienced, better product recommendations, optimal promotions, and content to meet individual preferences. Better data analytics can also help in effectively creating marketing campaigns, improving customer retention, and driving product development and inventory management.
Innovative formats such as social commerce and live shopping are beginning to impact the digital commerce landscape, offering new ways to engage with customers and drive sales, and may provide opportunity for brands that have been priced out or seen a downturn with post-pandemic shopping behavior. Social commerce integrates shopping experiences directly into social media platforms, tapping into the massive user bases of these networks to increase reach and engagement. Live shopping, on the other hand, combines entertainment and real-time interaction, providing a dynamic platform for showcasing products and encouraging immediate purchases. These innovations not only enhance customer engagement but also provide valuable data for businesses to refine their strategies and deliver superior shopping experiences.
The e-commerce sector is evolving rapidly, and businesses that effectively manage operational challenges and implement innovative strategies are best positioned for long-term success.
Digital Commerce Lecture for Advanced Digital & Social Media Strategy at UCLA...
IKEA " Case Study " Dr.Ahmad Adel
1. Introduction
IKEA is an internationally known home furnishing retailer. It has grown rapidly since it was
founded in 1943. Today it is the world's largest furniture retailer, recognised for its
Scandinavian style. The majority of IKEA's furniture is flat-pack, ready to be assembled by the
consumer. This allows a reduction in costs and packaging. IKEA carries a range of 9,500
products, including home furniture and accessories. This wide range is available in all IKEA
stores and customers can order much of the range online through IKEA’s website. There are
18 stores in the UK to date, the first of which opened in Warrington in 1987. In July 2009
IKEA opened a store in Dublin too - its first in Ireland.
IKEA stores include restaurants and cafés serving typical Swedish food. They also have small
food shops selling Swedish groceries, everything from the famous meatballs to jam. Stores are
located worldwide. In August 2008 the IKEA group had 253 stores in 24 countries, with a
further 32 stores owned and run by franchisees. It welcomed a total of 565 million visitors to
the stores during the year and a further 450 million visits were made to the IKEA website. IKEA
sales reached 21.2 billion Euros in 2008 showing an increase of 7%. The biggest sales
countries are Germany, USA, France, UK and Sweden. In 2008 IKEA opened 21 new stores in
11 countries and expects to open around 20 more in 2009 as part of its strategy for growth.
Low prices are one of the cornerstones of the IKEA concept and help to make customers want
to buy from IKEA. This low price strategy is coupled with a wide range of well designed,
functional products. IKEA’s products cater for every lifestyle and life stage of its customers,
who come from all age groups and types of households. This is vital in times when the retail
sector is depressed, as it increases IKEA’s potential market.
Since it was founded IKEA has always had concern for people and the environment. The IKEA
vision ‘to create a better everyday life for the many people’ puts this concern at the heart of the
business. IKEA has responded to the public’s rising concern for sustainability in its choice of
product range, suppliers, stores and communication. It has also spotted business potential in
providing sustainable solutions. IKEA’s concern for people and the environment encourages it to
make better use of both raw materials and energy. This keeps costs down and helps the
company to reach its green targets and have an overall positive impact on the environment.
This case study will show why IKEA believes a strong environmental stance is good business
practice.
77
SWOT analysis and sustainable
business planning
www.thetimes100.co.uk
CURRICULUM TOPICS
• Strengths
• Weaknesses
• Opportunities
• Threats
GLOSSARY
Franchisees: persons licensed to
trade using a particular well known
name in a particular area in return
for a fee or share of revenues made.
Retail sector: organisations selling
in relatively small units to the final
consumer.
Sustainability: practices which
do not adversely affect the future
use of resources.
IKEA
Economy
Society Environment
32184_IKEA:IKEA STUDY V5 23/6/09 09:18 Page 1
2. 78
SWOT analysis
IKEA's goals of sustainability and environmental design are central to its business strategy.
It has launched a new sustainability plan to take the company through to 2015. This will
combine social, environmental and economic issues.
IKEA uses SWOT analysis to help it reach its objectives. This is a strategic planning tool. It
helps the business to focus on key issues. SWOT is the first stage of planning and looks at the
Strengths, Weaknesses, Opportunities and Threats involved in a project or business venture.
Strengths and weaknesses are internal aspects. This means that they are within the control of
the business. They may refer to aspects of marketing, finance, manufacturing or organisation.
Opportunities and threats are external factors. This means that they are outside the control of
the business. These may include the environment, the economic situation, social changes or
technological advances, such as the internet.
A business can create opportunities and counter threats by making the most of its strengths
and addressing its weaknesses. For example, one of IKEA’s key strengths is its strategic aim to
use no more material than necessary in the production of each item. In addition, it develops
its product plans to increase its use of waste or recycled materials.
• One particular table, the NORDEN table, uses knotty birch wood. The knots in this wood
usually mean it is rejected by other retailers and manufacturers as unsuitable for use.
However, IKEA has made the knots part of its design feature.
• OGLA chairs are made using wood waste from saw mills and LACK tables use a
‘sandwich’ of stiff card between wood sheets to reduce the amount of solid wood needed.
Strengths
Strengths could include a company’s specialist marketing expertise or its location. They are
any aspect of the business that adds value to its product or service. IKEA’s strengths include:
• a strong global brand which attracts key consumer groups. It promises the same quality
and range worldwide
• its vision – ‘to create a better everyday life for many people’
• a strong concept – based on offering a wide range of well designed, functional products
at low prices
• a ‘democratic design’ – reaching an ideal balance between function, quality, design and
price. IKEA’s ‘Cost Consciousness’ means that low prices are taken into account when
each product is designed from the outset.
These strengths contribute to IKEA being able to attract and retain its customers.
One way IKEA measures its strengths is the use of Key Performance Indicators (KPI). KPIs
help IKEA to assess the progress of its vision and long-term goals by setting targets and monitoring
progress towards these. An example of one of IKEA’s KPIs is the percentage of suppliers that are
currently IWAY approved. The IWAY is the IKEA Way of Purchasing Home Furnishing Products. This
guideline defines the social and environmental requirements IKEA expects of its suppliers.
IKEA has strengths right through its production processes:
• Increasing use of renewable materials – IKEA improved its overall use from 71% in 2007
to 75% in 2009.
• ‘Smarter’ use of raw materials – IKEA increased the use of recycled or reclaimed waste
products in energy production across all stores from 84% in 2007 to 90% in 2009.
GLOSSARY
Strategy: long-term business
plan of an organisation.
SWOT analysis: Identification
and evaluation of the strengths
and weaknesses inside a firm and
the opportunities and threats in its
external environment.
Brand: a name, symbol or design
used to identify a specific product
and to differentiate it from its
competitors.
Key Performance Indicators
(KPI): financial and non-financial
measures to monitor performance
across a range of activities within a
function, department or role.
www.thetimes100.co.uk
Strengths Weaknesses
ThreatsOpportunities
External
Internal
Help + Hinder -
32184_IKEA:IKEA STUDY V5 23/6/09 09:18 Page 2
3. • Volume commitments – IKEA believes in creating long-term partnerships with its suppliers
in order to achieve this. By committing to buying large volumes over a number of years
IKEA can negotiate lower prices. This also benefits the suppliers because they enjoy the
greater security of having guaranteed orders.
• Economies of scale – for instance, bulk buying at cheaper unit costs.
• Sourcing materials close to the supply chain to reduce transport costs.
• Delivering products directly from the supplier to IKEA stores. This slashes handling costs,
reduces road miles and lowers the carbon footprint.
• Using new technologies – for example, IKEA’s OGLA chair has been in its range since 1980.
The chair has changed through the years to reduce the amount of raw materials needed.
Opportunities
A business uses its strengths to take advantage of the opportunities that arise. IKEA believes
that its environmentally focused business conduct will result in good returns even in a price
sensitive market. As the company states:
‘There is a true business potential for IKEA in providing solutions that enable customers to live
a more sustainable life at home. IKEA is developing effective solutions for customers in order
to support them recycling or reusing used products, aiming at no products ending up at land-
fill and the recycled materials used in producing new IKEA products.’
Some of the opportunities that IKEA takes advantage of through its sustainability agenda are:
• a growing demand for greener products
• a growing demand for low priced products. Trends in the current financial climate may
result in consumers trading down from more expensive stores
• demand for reduced water usage and lower carbon footprints.
IKEA has a number of areas of focus to its work with sustainability, each of which it supports
in various ways:
1. Solutions for a sustainable life at home – IKEA gives online tips and ideas for this.
2. Sustainable use of resources. IKEA aims for zero waste to landfill, wastewater treatment
and programmes to reduce its use of water.
3. Reducing carbon footprint. IKEA aims to reduce energy use, use more renewable energy,
cut its use of air transport and reduce packaging. Its green transport initiative includes an
aim to reduce business flights by 20% in 2010 and 60% by 2015.
4. Developing social responsibility. IKEA’s policy includes support for charities such as the
World Wildlife Fund, UNICEF and Save the Children.
5. Being open with all its stakeholders. This involves building trust through good
communication with consumers, co-workers, key opinion formers and the press. Being
sustainable is a central part of IKEA’s image.
Weaknesses and threats
Weaknesses
IKEA has to acknowledge its weaknesses in order to improve and manage them. This can
play a key role in helping it to set objectives and develop new strategies. IKEA’s weaknesses
may include:
• The size and scale of its global business. This could make it hard to control standards and
quality. Some countries where IKEA products are made do not implement the legislation to
control working conditions. This could represent a weak link in IKEA’s supply chain,
affecting consumer views of IKEA’s products. The IWAY code is backed up by training and
inspectors visiting factories to make sure that suppliers meet its requirements.
• The need for low cost products. This needs to be balanced against producing good quality.
IKEA also needs to differentiate itself and its products from competitors. IKEA believes there is
no compromise between being able to offer good quality products and low prices.
• IKEA needs to keep good communication with its consumers and other stakeholders
about its environmental activities. The scale of the business makes this a difficult task. IKEA
produces publications in print and online (for example ‘People and the Environment’) and
carries out major TV and radio campaigns to enable the business to communicate with
different target audiences.
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www.thetimes100.co.uk
GLOSSARY
Economies of scale: reductions
in average costs that stem from
operating on a large scale.
Carbon footprint: a measure of
the amount of CO2 produced by
individuals, businesses or countries
as a result of their activities.
Price sensitive: describes a
product whose sales are influenced
by price rather than quality.
Stakeholders: individuals and
groups with an interest in an
organisation and the decisions it
makes.
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