IKEA case study (Graded A+) - use as a guide only - 26025

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The IKEA Concept


The IKEA story began in Sweden in 1943 with the first store opening 1958, also in Sweden. Founder Ingvar Kamprad created the name from the first two initials (IK) of his name plus the initials of Elmtaryd (E) and Agunnaryd (A), his home town and village. The IKEA logo is blue and white, the colors in the Swedish flag. Ingvar came from a village area that valued hard work, living not beyond ones means, and making the best use of limited resources. This ethos created the framework for the firm which values low prices, high quality, and thereby a need to be very innovative. For example, IKEA asks the customer to partner with them, i.e. assembling their purchase to keep costs low. These strong cultural roots are still very evident today.


Stores operate in both company owned and franchise structure, in 2008 there were 285 stores operating around the world (253 company owned and 32 franchise). 82% of sales originate in Europe, 15% in North America, and 3% in Asia.


From http://franchisor.ikea.com/showContent.asp?swfId=concept2

The IKEA Concept is based on offering a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. Rather than selling expensive home furnishings that only a few can buy, the IKEA Concept makes it possible to serve the many by providing low-priced products that contribute to helping more people live a better life at home.


The IKEA Concept guides the way IKEA products are designed, manufactured, transported, sold and assembled. All of these factors contribute to transforming the IKEA Concept into a reality.


Also check out  http://franchisor.ikea.com/


Think about the below questions:



  1. What is this firm’s vision? 
  2. What is the firms mission or business idea.
  3. Describe its competitive advantage? Why do you think competitors have found this concept difficult to imitate?
  4. What is in the news about this company?
  5. Describe Anders Dahlvig as a strategic leader.
  6. Do you believe Anders Dahlvig is constrained in his strategic decision making because of the unique organizational culture at IKEA or is he free to create and implement strategic decisions as he sees best for the firm?
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IKEA case study - strategic management.docx
IKEA case study...