ikea

Ir1no%at1on at IKEK

Redecorating and renovating have become the international pasttnne In a post 9/11 world facing persistent terrorist alerts, more and more people are opting to stay home and make their homes safe havens This phenomenon coupled with lagging economies worldwide has contributed tremendously to the success of IKEA—the Swedish home furniture giant In the past 10 years sales for IKEA have tnpled, gro ing from o er $4 billion in 1993 to O\ er $12 billion in 2003

Much of IKEA s success can be attributed to its founder, lngvar Kamprad Kam prad us€d graduation money to start IKEA in the small Swedish village where hc was born I started off selling belt buckles, pens, and watches, whattver resi dents in the small local village of A needed Eventually Kamprad moved on to selling furniture One day in 1952 while struggling to fit a large table in a small car, one of Kamprad’s employees came up with the idea that changed the fur niture industry forever—he decided to remove the legs IKEA’s fiat-pock and self- assembly methodology was born. It rocketed the company past the competition. “After that [ followed a whole senes of other self-assembled furniture, and by 1956 the concept was more or less systematized writes Kamprad

Kamprad is dedicated toniamtaining the corporate culture he has helped define over the past 50 years He is a simple man—his idea of a loxury vacation is rid his bike He is fiercely cost-conscious and, es en though his personal wealth has been estimated in the billions, he refuses to fly first class He values hunian inter— action above all and, even though retired, he still isits IKEA stores regularly to keep tabs on what is going on when. the business really happens

The culture at IKEA is a culture closely connecttd with Kamprad s simple, farm-

raised, Swedish roots. It is a culture that strives “to create a better everyday for the

many people.” IKEA supports this culture by

hiring coworkers (IKEA prefers the word coworkers to “employees”) who are

supportive and work well in teams;

expecting coworkers to look for mnovative, better ways of doing things in cx cry

aspect of their work

• respecting coworkers and their views;

• establishing mutual objectives and working tirelessly to realize them;

• n&cing cost part of ever thing they do from improving processes for production to purchasing wisely to tnx cling cost-eftectively,

• avoiding complicated solutions—simplicity is a strong part or the IKEA culture,

• leading by Lxample, so IKEA leaders are expected to pitch m x hen needud and create a good woilcing environment, and

• believing that a diverse work force strengthens the company en erall

•

The IKEA culture is one that resonates for many. The buildings are easy to identify—the giant blue and gold warehouses tk resemble oversized Swedish

flags are hard to miss Millions of customers browse through the Klippan sofa and Palbo footstools (Nbrdic names are given to all IKEA products) in the stark

dimly lit warehouses The surroundings may not be lavish and the service ma be mostly self-service but customers keep going back not just for the bargains but to experience the IKEA culture as well

1 D scuss the three giput components of the Congruence Model as they apply to

the success of IKEA

2 Consider Schein s Four Key Orgamzational Culture Factors as described in

Highlight 11 5 What examples can you identify within the IKEA organization

that contribute to the company s strong corporate culture?

3 Based