Ryan Pavlak BRIT (R)(MR)
IKEA a Business Role Model It is rare to find an organization that follows its values the same way that IKEA does. Under the guidance of Ingvar Kamprad, the world’s 11th rich man, has imbed a certain set of ideals that not many other organizations around the world can match. Throughout this paper we will examine the various ways in which IKEA has managed the global environment. Also, we will explain the rationale behind the success of IKEA’s approach to managing its environment. By understanding this main points it will be clear why IKEA is like very few if any other business models around the world and why they are so successful.
IKEA’s Global Approach IKEA’s success is due mainly because of the various ways in which it has managed the global environment. The text for this course states, "IKEA’s global approach focuses on simplicity, attention to detail, cost consciousness, and responsiveness in every aspect of its operations and behavior" (Jones 88). Other ways that IKEA has managed the global environment are by instilling the same ideals of money on everyone in the organization, the focus on new employees, incentives for the workers, instilling teamwork and problem solving, and their approach when entering into a new market. We will examine each of these approaches in more detail to better explain why and how IKEA has become a global leader in the furniture business.
Simplicity, Attention to Detail and Cost Consciousness IKEA focus on simplicity, attention to detail and cost consciousness is a huge reason for their ongoing success. By making things simple this does not only affect and help the organization but it also benefits the individuals buying the goods. Although things may be simple it is the attention to detail that keeps customers coming back in the furniture business, but really in any business this is true. Usually when a company pays attention to detail their products then have a hefty price tag associated with such detail. But not at IKEA by reducing costs and not spending money frivolously they have been able to pass the saving along to the customer.
Money Ideals IKEA has a very bold market positioning statement, “Your partner in better living. We do our part, you do yours. Together we save money” (Ferrell & Hartline, 2007). The company’s ideals come from the 11th richest person in the world, Ingvar Kamprad, who happens to be the founder of IKEA. Born in the Swedish town of Smaland, Kamprad was raised with the ideas of being an entrepreneur, frugal, and hardworking. This frugal mentality resonances through the whole organization, " All IKEA employees fly coach class on business trips, stay in inexpensive hotels, and keep traveling expenses to a minimum"(Jones 89). By doing this not only does Kamprad keep costs down, he also shows the employees that everyone is kind of equal.
Focus on New Employees IKEA makes a point to immediately start instilling IKEA’s culture on any new employee. These employees always start at the very bottom of the organization and work their way us. By doing this it allows all employees to respect and understand the inner working of the organization. IKEA even goes a step further and holds what they call the “breaking the bureaucracy weeks” where the managers are required to work in the stores and warehouses for a week to make sure they do not forget what it is like. This is just another way that IKEA has successfully found a way to keep IKEA’s global values instilled in its employees.
In my own experience I have been under two completely directors, one that has no healthcare background and another that worked as a technologist, then became a clinical lead, manager and then finally a director. My current director the one with no healthcare experience is incredibly difficult to work for and doesn’t understand much more than the numbers he sees on the paper