Ikea Case Study

Topics: IKEA, Ingvar Kamprad, Ready-to-assemble furniture Pages: 9 (2439 words) Published: September 23, 2008
Case Study


Draft Version

NAME: Yimiao Lin, Bertrand Pedersen, John Sharp, He Gao, Kathy Wong CLASS: BMO6622 - MANAGING INNOVATION & ENTREPRENEURSHIP
TEACHER: Mr. Patrick Foley
DUE DATE: 8th September 2008


I.The Background

In 1956 when an employee of Ikea, Gillis Lundgren upon realising that a table he had purchased would not fit into the boot of his car without breaking off the legs left him but one option. He broke off the legs of the table and then reassembled the table back at home. The idea of flat box furniture or ready to assemble furniture was born. Gillis Lundgren was able to have a voice within Ikea to share this idea. Ikea as a company took the idea and is now part of Ikea key concepts. disc was new idea Ikea launched the first flat packed piece the Lovet table in 1956 . This was a low coffee table, made to be put together at home by the purchaser. This was a new idea which would change the way consumers viewed the idea of purchasing furniture in the future. Prior to this new concept furniture was either made to order or available as assembled at the showroom

Ikea began as a business entity in 1943 when the father of Ingvar Kamprad organised a company for him, Ingvar 17 at the time gave the name of his company by using the following initials, I from Ingvar his first name, K from Kamprad his surname, E from Elmtaryd his home farm and A from Agumaryd his home village. In 1943 Ikea was a business which relied upon bicycle deliveries of the following items matches, fish, seeds and Xmas decorations.

Ingvar Kamprad expanded a little in 1947 by advertising in the local newspaper, offering mail order and a catalogue. Furniture sourced from local manufacturer from the forest surrounding Agumaryd was including in the catalogue for the first time in 1950. The response to the new addition of furniture to the catalogue was so great that the decision was made to be involved only with Furniture. 1951 was the year when Ikea produced their first furniture catalogue. In 1953 in the local town of Almhult the first showroom was opened.

This simple idea became the key to Ikea’s success and Ikea was able to leverage this idea and incorporate.

II.The recognition of the opportunity

IKEA as one of the world’s best retailers, build the world’s largest furniture retailer and has grown impressively. Its success in the retail arena also seems to require companies to be innovative, adaptable, entrepreneurial and opportunistic, particularly when they begin to expand beyond their domestic markets (Arnold 2002). The objective of IKEA is to supply exclusive and reliable flat-pack Swedish designed furniture at bargain prices. (Reynolds, 1988)

1 - Leadership

Ingvar Kamprad, founder and spiritual leader of IKEA, revolutionized the selling of furniture. When Mr. Kamprad built first IKEA store and inaugurate IKEA Empire, and facing endless competitors and new technology he never discontinue innovation, whatever production, service, manufacture, and endue new elements with IKEA (Kippenberger, 1997).

2 - Vision and business idea

The vision of IKEA is to create a better everyday life for the many people. Its business idea supports this vision by 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. This vision and business idea insures the advantage of IKEA.

3 - Corporate culture

IKEA has opted for a very open, flat organization, giving responsibility early on to “co-workers”, with most managers only in their mid-30s (Kippenberger, 1997).Ingvar Kamprad said that IKEA must develop a very large product range for the home which is at the same time aesthetic, functional and of good value, in order to be accessible to...
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