The document discusses operations management in relation to strategic planning, highlighting the importance of effective implementation and evaluation. It compares the operations and marketing strategies of IKEA and Tesco, detailing IKEA's emphasis on product range and marketing communication, and Tesco's approach to cost leadership and customer-centric strategies. Additionally, it includes insights into corporate social responsibility practices and innovations employed by both companies to maintain competitiveness in the market.

1. OPERATIONS MANAGEMENT
7
OutlineIntroduction
Management is understood both in terms of its purpose, as those
activities that take place to ensure that the primary company’s
objectives, as outlined by its strategic plan, are accomplished. It
is also understood as an assembly of senior employees
answerable to performing this operation. Management can be
better understood as all that is requisite to positioning a
company in a way that will see into its long-term survival in a
competitive industry. Again, an operations management model
is a company’s way of expression on how it produces unique
value.
The idea of operations management, just like strategic
management, builds on this definition of strategic planning,
recognizing that although planning is the prelude of operations
management, it is insufficient if not followed by the deployment
and implementation of the plan and the evaluation of the plan in
action. Strategic management is a systems approach to
identifying and making the necessary changes and measuring
the organization’s performance as it moves toward its vision’. A
company will realize its goals and vision if it applies operations
management strategies with practice, forbearance, allegiance,
hard work, and administrative learning. With each modification
of the operations management plan, high-ranking employees
will become better and more capable of deploying the plan,
implementing updates, and evaluating organizational
performance.

2. Market orientation is the basis of marketing. It sets on
satisfying the market through an apprehension and reception to
local needs. Those needs include final and intermediary
customers, contenders and macro-environment. According to
Narver and Slater (1990), market orientation leads to master
operation. Because of the retail industry’s direct reach with the
market and clients, it is logical to consider market orientation
as a concept to evaluate the successes of IKEA and Tesco. This
paper compares operations management of the two companies; it
takes a closer look into marketing and corporate strategies. The
paper further examines the appropriateness of the applied
strategies and frameworks for each company in relation to its
target customers and best practice. In so doing, this paper
evaluates the mix of managing operations concepts and
frameworks, which IKEA and Tesco apply to ensure their
survival and market leadership.
Ingvar Kamprad Elmtaryd Agunnaryd (IKEA)
IKEA was founded in Sweden in 1943. It is a privately held, and
deals globally in home products retailing handling pack
furniture, accessories, and bathroom and kitchen products. The
company distributes its products by its retail outlets. By this
May (2010), IKEA had 313 shops in 37 countries. Most of these
shops are in Europe, North America, Asia and Australia. The
IKEA Group its own owns 276 shops in 25 nations. The rest 37
shops in16 territories are possessed and run by franchisees
outside the IKEA Group. IKEA comprises of more than one
management teams and its affordable prices and marketing
strategy makes is the world's largest furniture retailer.
IKEA Marketing Strategy
IKEA has a long custom in marketing communication
concentrating chiefly on printed media, which has demonstrated
its values and achievement to the company for many years. The
company currently uses other media to a snowballing degree
such as Television, radio, and internet centered communication.
The company’s marketing strategy is organized into a single

3. marketing mix comprising of four diverse areas of
concentration:
i.
The product range is the company’s terminus a quo. All other
performed marketing communications are used to strengthen and
amplify the IKEA product range.
ii.
The store is the company’s retailer principal medium for
highlighting and putting across IKEA’s range of products, its
low monetary value and its concept.
iii.
The IKEA catalogue is the chief marketing contrivance, which
singly takes about 70% of the company’s yearly marketing
budget. The IKEA catalogue is developed in 38 various editions
for 28 countries and in 17 languages. In 2009 alone, 110 million
catalogues were put into circulation. Lightly, this number was
threefold higher than that of the Bible! 13 million copies were
circulated in the UK alone. The IKEA catalogue is distributed in
stores and by mail.
iv.
The company advertising, public relations and other kinds of
communication are accompaniments to the IKEA product range,
stores and showrooms and catalogue. They are used to spear-
point the penetration of the company’s target market.
The UK Marketing Department
The company’s advertising in the UK is aimed at raising
cognizance of the IKEA brand and driving traffic to its product
stores. IKEA reports that some people love their ‘unique style
of retail advertising, some hate it, but everyone who sees [its]
advertising has a strong opinion and subsequently it provokes

4. conversation and debate.’ Despite holding some of the most
controversial television ad blitz in the UK, the company has
elicited awareness of its brand, let people cognize that it is
different to other competing home endowing companies, and
most crucially, enhanced sales. The company’s advertising
management comprises of all facets of advertising and brand
communication ranging from television advertising and
sponsorship to radio and magazine promotions. For IKEA,
advertising is managed to back many various areas of the
business, together with brand cognizance, catalogue drops, store
themes, and store openings.
Brand Research
To hold on to the forefront of a liquid market, IKEA needs as
much research on its customers, the home furnishing industry
and its competitors, as possible. The company undertakes many
diverse fields of market research. It then in its management
considers both internal and external reports, accounts and
statistics when designing any communication or marketing
operation.
Room Magazine
Room Magazine is the company’s European magazine that is
accessed in all its stores in Europe. Additionally, it is mailed
out to 150,000 IKEA Home Card bearers in the UK. Room
Magazine is filled with content on IKEA clients’ lifestyle
features and how they live, company product news, and home
tips and ideas. Just like the catalogue, Room Magazine is
centrally produced, but each every company’s participating
country has control over what number of pages it requires to
communicate its country-specific messages to its customers.
Food Services
IKEA has restaurants which are significant in giving its
customers eating and relaxing places while they are shopping.

5. The company has three various concepts providing food in its
stores in the UK. The major restaurant serves dishes grounded
on its Swedish heritage, with traditional meals including
Gravadlax and meatballs in combination with Lingonberry
flavor. The company also has bistro areas which serve localized
snacks including; pizza in Italy, hot dogs in the UK, and
baguettes in France. Observably, the company’s Swedish food
markets are located in all its stores. This operations strategy
encourages customers to fetch to their homes a taste of Sweden.
The rich range of Swedish traditional dishes helps the
company’s customers to realize the company’s Swedish origins,
which also lives up to its low price promise to its customers.
Internet
The company manages a global website, IKEA.com. This is a
place where anybody interested in its products can have a
synopsis of IKEA as a company. From IKEA.com, its visitors
can also get access all its local websites across the world. One
of the chief tasks of IKEA.com is to exhibit product selective
information and availableness. The company’s operation
management ensures that this information is regularly updated.
To further market this company, its background and store
information has to be known. IKEA.com is there to serve this
need as well. On the website, every store has its own space
displaying its contact details and mapping, events, discounted
offers and additional local information.
Com-in
Com-in works in an active manner to safeguard the company’s
competitive advantage; Com-in achieves that through the
development of the company’s retail concept, and the store as a
media. All Com-in experts come from either an interior design
setting or visual merchandising, and are accountable for product
presentation or the company’s product offers, by use of all
current varieties of presentation media and proficiencies. The
Com-in operation department provides the stores with

6. inspiration and vitality. The operation works hand in hand with
the store sales and logistics departments to ascertain that the
company’s customers see something new and exciting all the
time, and desire to return again and again.
Public Relations
The chief concern of public relations is to defend the company’s
corporate identity. Its other role is to communicate the
company’s vision, brand values, business idea and concept, and
trademarks. Public Relations inform journalists of news and
information within the company by use of press releases,
information on the company’s websites, catalogues and product
launches. By so doing, the company is able to communicate
with a vast audience. The company, on IKEA.com acknowledges
that all its ‘policies live up to this standard from the products
[it sells to its] internal travel and recruitment procedures’. All
facets of the company’s operations management in marketing
work hand in hand to furnish coherent messages to its customers
as well as strengthening its brand identity. The company again
states that by centering on communicating crucial messages of
its concept, its vision, and business idea, it can work together to
create its vision of ‘a better everyday life for the many people.’
IKEA Corporate Strategy
Corporate social responsibility (CSR) is a wider concept and is
not fixed to supply chains, but to the organizations’ complete
treatment of mankind as well as the surroundings. While CSR is
a well-laid down concept, there is no universal agreement on the
meaning of CSR in practice. An exact definition of CSR is
subtle because numerous notions and positions about the type of
the relationship among business and society waver with the
applicable matters of the day. Moreover, it has been argued that
the problems with arriving at a meaning of CSR partly ought to
do with the difficult of deciding operationally the managerial
significance of such a definition. This is therefore the major
problem looking at companies' differences in profitability, size,

7. societal impacts, products and resources.
Through IWAY, IKEA is ready to deal with matters related with
corporate social responsibility and ethics. The IKEA code of
conduct defines the prerequisites that the company places on its
suppliers of their products and services. It bases that suppliers
are responsible for conveying its message to their workers and
sub-providers. IKEA stands that The IKEA its suppliers must at
all times abide by the most exacting demands, whether they are
instituted by IKEA or are relevant pertinent land laws.
In reference to corporate social responsibility and ethics,
IKEA’s IWAY outlines a few comprehensive requirements in
relation to its operation management:
i.
The company does not engage children in labor, nor does it
allow its suppliers and business partners to,
ii.
IWAY does not put the company in a position to apply forced or
bonded labor; it does not allow the company’s affiliates either,
iii.
The company encourages and follows a transparent and
authentic records of working system for duration of work and
remuneration,
iv.
IKEA has an insurance policy addressing work linked medical
treatment such as due to accidents. In the same spirit, its
suppliers must make available a salubrious and innocuous
working setting,
v.
To ensure that health and safety issues are addressed

8. continuously, IKEA requires its suppliers to offer health and
safety education for their workers,
vi.
IKEA demands that its suppliers must warrant their
constructions are safe, have sensible privacy, are not noisy and
have amenities for individual, hygiene in cases where suppliers
provide their workers with accommodation,
vii.
IKEA does not expect its suppliers to forbid their workers from
exercising negotiation activities,
viii.
IKEA does not anticipate its suppliers to accept corporal
punishment, intimidations or other kinds of intellectual or
bodily coercion.
As IKEA takes its responsibility in the social arena, it ensures
that the environment is safer, in collaboration with its suppliers.
For instance, its suppliers put efforts to cut down on energy
consumption, and avoid air, soil and water pollution. They as
well must be certain that their workers who handle chemicals
and other risky waste are competent and are regularly trained.
However, as this paper will indicate later, IKEA has had a
rough side of things in the process of managing its operations.
In the mid-1980s, IKEA found itself in an environmental trouble
that had substantial consequences on its furniture line.
According to tests carried on some of the company’s particle-
board furniture products demonstrated that formaldehyde
emissions outmatched the standards defined by the Danish
environmental law. This was a blow to for the fact that IKEA
extensively used particle-board in making its furniture products.
That meant that in case the particle-board from one of IKEA’s
products breached the environmental standards and was

9. considered hazardous, then all products made of particle-board
could be so considered. The company faced negative publicity,
which called for quick and smart response. IKEA was not pulled
back by its customers’ complaints, but rather embarked on
devising better and convenient means to replace diesel in order
to preserve the environment and minimize the utilization of
wood in its furniture products. This is an example of a good
operations management in cases of controversy.
2.
Tesco plc.
This is a British international grocery and general
merchandising retail chain. It is the UK's largest supermarket
chain, and it has its headquarters in the Tesco House in
Cheshunt. Tesco has grown organically over time, and also
through acquisitions. Currently, it operates over 800 stores.
Tesco in the beginning specialized in food and drink. It has
since diversified into many other industries including
electronics, renting DVDs and CDs, telecoms, financial
services, clothing, home, health, car and dental insurance, and
retailing. It also deals in music downloads, software and
Internet services.
Tesco Marketing Strategy
Tesco’s customers include local communities, families, single
people, governments, environmentalists, general workers, and
managers. Like other large retailers such as IKEA, Tesco gets
goods from its suppliers into regional distribution centers. It
then prepares and delivers them to stores. Tesco’s marketing
strategy is clear; its growth is being tracked from four
platforms:
i.
Its main UK grocery business,
ii.

10. Non-food,
iii.
International extension and retailing services such as financial
services,
iv.
The Internet business and telecommunication packages.
Tesco makes use of its firm unwavering core to keep the
business flourishing as it ventures into novel riskier areas of
development. The company is winning in the non-food market
by offering its products below cost price. The company uses this
marketing strategy with the aim of creating its brand a cost
leadership. Unlike IKEA which sells its products at a cheap
price but with a profit, Tesco sell below the cost price to gain
support and make its brand to be widely recognized. This to the
company is to successfully differentiate its line of clothing so
that it can charge a premium price, later. However, for the
reason that a marketing strategy will involves analyzing markets
and products, and that a strategy is enforced through marketing
maneuvers which call for detailed decisions about elements such
as price and distribution; Tesco has to resolve on its model of
market entry. It has to look into its own stores, Internet
marketing or joint venture with an established national retailer.
Unlike IKEA’s four marketing areas discussed before in this
paper, Tesco carries out its marketing strategy with the
following objectives:
i.
Aims at a targeted 10% profitability operating margin,
ii.
Aims at a 20% Swedish Market share target,

11. iii.
Desires a high customer advocacy; that is, the number of clients
who recommend the company’s branded clothing which may
lead repeat business,
iv.
Wants to be a respected company; it aims at having a large
number of its community stakeholders respecting it,
v.
Targets its employee motivation; that is, the number of its
workers who feel motivated to deliver the company’s goals.
In contrast to IKEA’s objectives, Tesco’s management seeks to
directly satisfy its workers. Also, the company sets quantifiable
targets. It for example states that it aims at getting 10%
profitability operating margin and a 20% Swedish market share.
Such specific targets can help any company to know when it is
headed to achieving its objectives and when its operations are
declining. A company can then adjust its operations
management to do what is necessary before its financial
duration comes to a close.
Tesco’s operations management emphasizes on customer needs
through its values and philosophies:
i.
‘No one tries harder for customers’, and
ii.
‘Treat people how we like to be treated.’
Copies of those values are circulated through the company’s
internal marketing strategy. The distribution is also done

12. through the company’s newspaper to its employees. But,
notably, this pair of values originates from the UK. Similar to
how IKEA prepares dishes according to the localities in which
it has set up its stores, Tesco needs to realize of a demand for
country-specific exercises. This can support the company’s
local corporate unity.
When it comes to innovation, like IKEA, the company is equally
developmental; Tesco is reputed for advanced information
solutions. For instance, its concepts of ‘Clubcard’ loyalty
scheme as well as its web sites are a demonstration of the
company’s innovation. This is the UK’s largest retailing
company; it consequently has a significant number of customers
on which it can perform analysis. The company is in a good
position to carry out a precise customer survey because most of
its card holders are regular customers who visit Tesco stores
weekly.
Tesco’s marketing strategy is also related to target choice. The
company decided to venture into markets in Eastern Europe and
South East Asia where it found local competition to be soft and
manageable. This marketing strategy was in one way evading
completion from the markets dominated by other expanding
heavyweights such as Wal-Mart. The company has also made
use of opportunistic events, through different entry modes so as
to develop brand knowledge. This is also in contrast to IKEA
which has mostly banked on Television, Newspaper and
catalogue distribution to its subscribed customers; Tesco target
all!
Tesco Corporate strategy
Liptrot (2005) is worried on how Tesco is capable of appealing
to all market segments. This company has achieved this through
a strategy of using its own-brand products, whether it is home,
food, telecom beverage, clothing, or financial services, to stick
its corporate brand to the market. The company markets itself

13. by the phrase "The Tesco Way" to depict its core intentions,
values, principles, and objectives. Another chief part of the
company’s successful corporate strategy has been its innovatory
utilization of technology. For instance, Cio.co.uk (2010)
reports that Tesco is among the first companies to introduce
self-service till where cameras are used reduce queues.
Tesco is also set to protect its corporate brand. In Thailand,
Tesco has of late been applying a policy of establishing
defamation proceedings to protect its corporate image. For
example, in November 2007 the company an academic and a
previous minister Thailand for civil libel and criminal
defamation. Tesco is maintained that the academic and the
former minster compensate £1.6 million and £16.4 million
respectively in addition to having two years in prison (Leigh
and MacKinnon 2008).
Another way that Tesco is enhancing its corporate management
is through social corporate responsibility. The company is
committed to corporate social responsibility by contributing
1.87% of its pre-tax profits in 2006 to charities in local
community organizations. This is a good corporate move to
make the population feel closer and be associated with such a
gigantic company. However, Tesco’s strategy has not gone
without criticism; Intelligent Giving (2007) has condemned the
company for directing all its staff contributions to Tesco's
Charity of the Year.
In addition, Tesco has ever been on the negative side when
managing its operations campaigns. One recent example is its
use of “Change for Good” in its 2009 advertising. “Change for
Good” is a UNICEF trade for charity, which the agency uses for
charity purposes but not trademarked for commercial or retail
usage. UNICEF reacted by saying, ‘it is the first time in
UNICEF’s history that a commercial entity has purposely set
out to capitalize on one of our campaigns and subsequently

14. damage an income stream which several of our programs for
children are dependent on”. The agency further called on the
public having the children’s welfare at heart, to think carefully
on whom they ‘support when making consumer choices’
(O'Halloran 2009).
Conclusion
This paper has established that it requires smart moves of a
company in order to gain and keep customers and hence grow
its profits and expansion. It requires innovative thinking and
provision of working solutions to any targeted market. From
analyzing IKEA’s marketing strategies, it is clear that for a
company to succeed in its operations, it has got to formulate a
marketing mix in order to appeal to a wider audience. For
instance, the paper demonstrated that instead of using a single
medium to communicate to existing and prospect customers, a
company needs to use Television, Internet, print, radio and
word of mouth. IKEA has been recognized to following this
strategy.
Tesco was not left behind. It was seen as a company that has
applied management operations of ‘out of the box’ nature. It
takes advantage of events to exhibit its presence while
‘inserting’ its marketing communication to the audience. The
company was also seen demonstrating extreme operations
strategies such as selling some of its products below the cost
price. Finally, its attempt to use UNICEF’s trademarked slogan,
which put it on the dark side of business, is an example of how
companies manage their operations to keep leadership in the
market.
Operations management is a very crucial business arm. If well
made use of, it can help the company to gigantically and
globally grow, however if wrongly handled, it can taint the
corporate image and put the company in jeopardy.
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