IKEA Company’s Globalization Process

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IKEA is an international company that is known by people all over the world for its low prices, its stylish and professionally designed furniture and accessories, and satisfied customers. In addition, the business is famous for its use of sustainable materials and support of various initiatives that concern children and the environment. IKEA’s worldwide popularity and recognition can be largely connected to the concept of globalization, which can be defined as a specific process aimed at diminishing boundaries between the nations, cultures, and organizations and making individuals more connected to each other (Steger, 2017). Therefore, it is widely believed that the company would not be this successful without the influence of the mentioned social tendency. The following paper will discuss IKEA in relation to the process of globalization and investigate some of its distinguishing features.

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In my opinion, it would be much harder for IKEA to become an internationally recognized company without the significant impacts of worldwide integration. As mentioned by Steger (2017), “the transformative powers globalization reach deeply into all aspects of contemporary social life” (p. 16). It influences the way people communicate, create opinions about different political, societal, and environmental issues, perceive the world, and make everyday life decisions. Talking more specifically, globalization highly promotes the idea of sustainability that relates to the problems of climate change, biodiversity, and the use of renewable energies (Steger, 2017). For this reason, it can be concluded that the ideas of globalization help IKEA to stay relevant in the market and encourage individuals to purchase its products. Its focus on environmentally-friendly materials in the production is what makes the business fit in the social norms of globalization and motivates people to purchase its goods.

Concerning Globalization and Megatrends 2020, I believe that IKEA acts in line with economic and technological scope in terms of productivity. In the contemporary globalized environment, the demands for the companies related to competitiveness and productivity are quite high; thus, they have to establish effective performance strategies. For instance, it is important for the businesses to constantly work on improving the quality of their products and increasing the number of values they provide to the customers to be competitive and popular on the international market (Steger, 2017). IKEA is a good example of an organization that invests in the advancement of its products and operations. The company’s furniture designs focus on style, function, health, quality, environment, and price relevant to the needs, desires, and abilities of its clients. Hence, this tendency gives IKEA a chance to stay competitive between other businesses and relevant for the customers.

Even though the mission and core values of IKEA are not clearly stated and cannot be found on their website, it is easy to indicate them based on the company’s performance and other statements. According to my observations, the mission of the company is to offer a wide range of professionally designed furniture and home accessories that everyone could afford. This claim is based on the fact that even though all the products are sold at a low price, their quality and design are always at the highest level. Furthermore, the main values of the organization should match its mission. The examples of IKEA’s core values are innovation, environmentalism, efficiency, and accessibility. The business wants to ensure that every individual has an opportunity to take advantage of the benefits provided by it.

IKEA is also famous for a successful supply chain management that focuses on sustainability. As explained by Laurin and Fantazy (2017), this concept refers to the coordination of “exchanges of materials and information in the logistics process stretching from the purchasing of raw materials to the delivery of end products to end customers” (p. 311). The main characteristics of IKEAS’ supply chain are sustainability and effective economic administration. The company can successfully implement its sustainability policies across all operations while including different partners and stakeholders and taking into consideration their financial interests (Laurin & Fantazy, 2017). Therefore, it can be stated that IKEA was able to establish a formal, reusable, and efficient set of practices that make it popular and demanded in the market. The organization is an excellent example of a successful and consistent supply chain management strategy.

Key Performance Indicator or KPI is an essential value that determines how successfully an organization is achieving its established goals and objectives. This tool is extremely useful for the companies that are interested in keeping track of their achievements and failures, enhancing the effectiveness of their operations, and preventing the emergence of challenges. According to data, IKEA successfully fulfills its goals and; therefore, has good Key Performance Indicators. For instance, since 2010, the company was able to grow its sales by 7 % and positively influenced the satisfaction of its customers (Laurin & Fantazy, 2017). Furthermore, IKEA constantly expands its operations and opens offices in different countries. This tendency allows the company to continually grow, enhance its international reputation, develop new products and services, and support its customers during the purchasing journey.

Considering the characteristics of global businesses, IKEA successfully aligns with the international trends in the current market. It is suggested that the company can manage and harmonize the simultaneous procedure of adapting and acting based on the changes in the business environment (Vahlne & Jonsson, 2017). The business explores what are the most common trends and needs of the customers and shifts its operations according to these modifications. This phenomenon of IKEA is one of the reasons why the company remains to be popular among the general public for so many years. Clients feel that IKEA cares about their desires, preferences, and abilities; thus, they establish a specific connection with it and experience constant motivation to support the business by purchasing its products. Consequently, IKEA’s ability to adapt to global trends and challenges help it to remain popular and have regular customers.

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Overall, IKEA can be described as one of the most successful businesses in the retail market. This company does not only provide its customers with high-quality goods, but is also famous for effective management strategies. Its competitive and productive since it follows its values and is devoted to its mission – to provide professionally designed furniture and home accessories for the lowest prices so that every individual can live in a stylish house. In addition, various data support the claim that IKEA is a business concerned with severe environmental problems, since their main goal is to support sustainability and produce goods from the renewable materials. Thus, the presented paper discussed the IKEA company, its general characteristics, and its features in the process of globalization.

References

Laurin, F., & Fantazy, K. (2017). Sustainable supply chain management: a case study at IKEA. Transnational Corporations Review, 9(4), 309-318. Web.

Steger, M. B. (2017). Globalization: A very short introduction. Oxford University Press.

Vahlne, J. E., & Jonsson, A. (2017). Ambidexterity as a dynamic capability in the globalization of the multinational business enterprise (MBE): Case studies of AB Volvo and IKEA. International Business Review, 26(1), 57-70. Web.

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BusinessEssay. 2022. "IKEA Company's Globalization Process." June 1, 2022. https://business-essay.com/ikea-companys-globalization-process/.

1. BusinessEssay. "IKEA Company's Globalization Process." June 1, 2022. https://business-essay.com/ikea-companys-globalization-process/.


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