Strategic Management Report
This report provides an analysis, evaluation and recommendation on the strategic management of IKEA. Methods evaluating and analysis includes SWOT analysis, Pestle Analysis, Porters five forces and finally internal environment analysis. This report will show findings on the internal and external forces of the company and then illustrate on how the company deals and curb with these factors and gains its comparative advantages in its market. To the end of the report, a recommendation will be given based on the factors of environment to generate a strategy for the company.
1.1 Background to Organization
The chosen organization is IKEA. This organization is founded in 1926 by Ingvar Kamprad in Sweden. Originally IKEA sold everything from pens and wallets to watches and ladies stockings. It attracted people by the lower price. In the late 1950s, Ingvar decided to stop selling everything expect furniture items. In 1959, IKEA had 100 employees.
IKEA’S products are in varieties kinds of styles which can meet different kinds of people’s needs. Also, the furnitures in IKEA have many different functions. Besides, IKEA pays attention to the materials they used that all the materials are environmental and will not affect our health.
IKEA keeps profits flat during the global economic crisis. According to a DI estimate, the Swedish furniture giant 's profit was over 50 billion kronor in 2009. However, Ikea also had slashed 5,000 jobs to cope with the drop in demand brought about by the global economic crisis.
1.1(c) Organizational structure
Despite IKEA’s Swedish roots, the owner of IKEA is a Dutch company. The operator of the majority of the stores worldwide is a separate entity, the IKEA Group which is a private group of the companies owned by a Dutch charitable foundation. Of the 202 IKEA stores in 32 countries,
References: Author: AFP (22 February 2010) Title: IKEA made $7 billion profit-despite the crisis http://www.swedishwire.com/business/3008-ikea-made-7-billion-profit-despite-the-crisis Author:Hine (6 May 2011) Title: IKEA-Strengths, weakness, opportunities and threats http://highn.me/ikea-strengths-weaknesses-opportunities-and-threats/ Author: Carl Haub (2013) Title: World Population Data Sheet http://www.prb.org/Publications/Datasheets/2012/world-population-data-sheet/fact-sheet-world-population.aspx Author: PDF (16 July 2012) Title: World Economic Outlook Update http://www.imf.org/external/pubs/ft/weo/2012/update/02/index.htm Author: Observer (12 June 2005) Title: IKEA-Brand of money http://www.guardian.co.uk/business/2005/jun/12/theobserver.observerbusiness4 Author: IKEA (2012) Title: Our purpose http://inter.ikea.com/en/about-us/purpose/ Author: Shireensachar (April 2010) Title: IKEA Brand http://www.studymode.com/essays/Ikea-Brand-304920.html Bishop, W. R. (2003). Leveraging In-Store Systems for Competitive Advantage. Bishop Consulting, pp 1-19.