IKEA Qualifications and Analysis

Keywords: backdrop of ikea, ikea background

IKEA began operating in Sweden in 1943.

The founder of IKEA is Ingvar Kamprad who's from Sweden.

The previous CEO of IKEA is Mikael Ohlsson, replaced by Peter Agnefjall in 2013.

IKEA is an exclusive limited company that own by an organization manipulated by Kamprad family.

IKEA is an international home furnishing retailer that provides good quality design in low price furniture, bathroom, kitchen and accessories surrounding the world.

Originally IKEA only sold wallet, pens, watch, picture body and rings.

IKEA is continuing to grow to be major global furniture merchants.

IKEA is cooperating with an increase of than 1, 500 suppliers around the world, which is just about 50 countries in developing their own furniture.

IKEA trade internationally that have 341 stores in 38 countries. (Germany, United explained, France, Italy, UK, Sweden, Spain, Canada, Russia, China yet others)

The quest of IKEA is "Offering an array of well-designed, functional home furnishing products at prices so low that as many folks as possible will be able to afford them. "

The eye-sight of IKEA is '' to produce a better everyday activity for the many people. Our business idea helps this eye-sight by offering a wide range of well-designed, functional home furnishing products at prices so low that as many folks as possible can afford them''

The aim is to create affordable price of product for the customer who cannot find the money for to buy expensive product. Ensure the customer found what they are looking for in the store at a low price.

B) An research of how the culture is transmitted to the employees.

IKEA's employees will be the most effective resources in the business.

When employees are fruitful, it can help increase the progress rate.

IKEA is dedicated in becoming a fantastic employer for thousands of employees about the world.

IKEA offers a safe and healthy environment as well as progression opportunity for each sole one of its employees.

IKEA contains human being rights and value for each employee plus they work in a living and strong company culture.

Employees value teamwork, modesty, decrease, cost-awareness and rational.

They are always prepared to learn and improve.

IKEA encourage employees to question accepted alternatives, test new ideas and find out mistake as a way to develop and develop.

IKEA uses "Speech" (a company-wide survey) to monitor the way the employees thoughts and opinions on various aspects of their occupation at IKEA.

Every year, IKEA will ask employees to fill in the study to make inquiries their dissatisfaction and what kind of drive do they want.

Based on the results from the survey can help define areas to boost at IKEA.

The "IKEA Control Index" quantifies how employees consider their managements.

IKEA continue steadily to give a safe and healthy working environment for all their employees because the basic safety of employees and customers is usually a main main concern at IKEA therefore employees should have an sufficient training before they get access to the safety gear and equipments.

All employees within the merchant and circulation must undertake basic safety training previous to work at IKEA.

Therefore, each IKEA outlet must have a risk manager who is responsible for local safety exercises based on the IKEA Group Risk Manual.

IKEA's employee's business journeys are given with latest travel-risk information and a 24 hour global emergency service.

IKEA builds strong romantic relationships with employees to make them feel that they belong in their place of work.

Well-functioning inside communication is an activity which helps the employee's capability to execute their responsibilities, to learn and develop effective command.

Every manager gets the responsibility to ensure their employees have the ability and tools to receive and understand the info given.

Managers in IKEA receive support from tools and specialists available as part of the basic leadership training designed.

The IKEA Intranet includes multi-channel such as newsletters, easily accessible notice planks and plasma screens, regular conferences and closed-circuit radio.

IKEA has a web-enabled service which allows the employer to hook up with employees from different countries with limited access to receive media and information about various IKEA activities.

Employees in different age range or different periods in their lives may have different abilities and demand. Therefore, IKEA give a reasonable working hour, responsibility, to every staff corresponding to demographics.

C) Discuss about how external and interior environment affects the organizational culture.


  • IKEA have the reduced cost of development therefore the price of the product is fair.
  • Mainly is basically because the product is made in China.
  • IKEA have better enlargement to other market because IKEA have long-term brand name identify globally.


  • IKEA use the innovation of technology and systems to be able to shorten the queues, monitoring and scheduling the product.
  • IKEA using environmentally friendly product as a potential for advancement of technologic
  • IKEA inventor new technology that can shorten the queues that can save time
  • The IT section will keep updating the catalogue to the web site of IKEA to be able easier for customer to have the latest information about the product.
  • IKEA provide online searching for the client to make order directly. Customers just place a product to add to cart. By using this way it allows customers and staff saves enough time.

Rivalry within the industry

  • In Malaysia you can find handful of competition in the furniture industry.
  • Besides that, there are a lot of retailers in the market.
  • There are Tesco, The judge and Carrefour.
  • On top of this many stores some are import from China and India. Therefore they can sell at cheap in the market.
  • This shows that the competition of the rival in this industry is really high.

Bargaining power of suppliers

  • The bargaining electricity of suppliers in IKEA is low.
  • IKEA has good romance with suppliers round the world and most of them are from China which consist of 1380 suppliers in 54 countries
  • IKEA has its developing company like Swedwood Supplier.
  • Therefore it is clear that IKEA can threats the suppliers to enter their business.

Bargaining electric power of buyers

  • Customers prefer to compare the price among the retailers. Therefore price warfare may happen against each other.
  • Customer direct obtain China also mixed up in direct competition market.
  • So the consumers have many alternatives.
  • Bargaining electric power of buyer is high. Because they acquired many choices which manufacturers they can purchase from.

Threats of new entrants

  • There are no entry barriers on the market.
  • But the effectiveness of competition may repulse the potential entrants. Because they have recognize their brand name globally.
  • Retailers only can operate a tiny business, they don't have enough capital besides that they lack of good relationships with the equipment, and therefore they do not have the strength to contend with IKEA.
  • Therefore the risk of new entrant is high, if competition want to invest a great deal in their business for an extended term.

Threats of substitutes

  • As the styles are changing matching to fads. The industry move from solid wood to plywood, plastics even iron.
  • As the market is becoming more worried about environment friendly therefore many companies are practice for live green.
  • As the essential functional demand of customers have remain the same. Therefore there are no dangers of substitutes.

Internal environment:


  • Giving employee 14 days of training before start work.
  • Training has been conducted by senior director and learning and development instructors from IKEA stores in the united states.

Incentive and benefits

  • Full time employees receive full medical and oral insurance (include spouse and family members. )
  • Paid maternity or paternity leave
  • Employees are entitle to a discount on purchase in IKEA


IKEA abolish junior pay rate and expose a new pay structure whereby guaranteeing one rate of pay each position regardless time with IKEA or time.

Human Resources

  • IKEA recruit worker through interview
  • HR does indeed the recruitment and training for the advantage of IKEA.
  • HR is held responsible to keep and strengthen the culture in IKEA.
  • IKEA employees come from different record that is being shared to build up and transform their vision into a reality.
  • HR must ensure that employees and managers can handle working jointly towards attracting, extending, and stimulating a wonderful work experience.

Change in Management Style

  • Transformational leadership which include 4 elements. /democratic and paternalistic style. /autocratic leadership style
  • Intellectual stimulation
  • Inspirational motivation
  • Individualize consideration
  • Idealize influence

Internal management

  • IKEA practice informal management style.
  • IKEA have to adapt their business style based on the countries culture.

Performance appraisal

  • This is the process whereby the employer evaluates the worker predicated on their job performance throughout a specified amount of time.
  • Employee that achieves a good performance will be rewarded consequently.
  • IKEA practices Tone and management index too

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