Section 1
This section will offer a brief analysis of IKEA as a company, where it stands in the market in terms of competition and advantages, and the operation scales. Besides, the external and internal factors of IKEA will be discussed in this section.
IKEA Company Profile
IKEA is one of the largest companies in the world, serving the furniture industry in a multinational capacity. Incepted in 1953, the company was initially created to cater to mail-order catalogs before making a transition into furnishing. Its main targets in furnishing are described by its simple aim;-being a brand that effects furnishing of quality through affordability, design, and offering comfort to all people in the world (Solanki, 2021). IKEA is one of the most highly profitable organizations in the current world standings, posting a gross profit averaging over $2.5 billion (Solanki, 2021). The store also boasts the highest number of customer visits, with an average of 0.9 billion customer visits annually. This, therefore, implies that the running of the company is intricate and carefully set upon the principles of good management. Hiring criteria in IKEA cannot also be taken with a similar approach as the ones used by other organizations. This way, it means that IKEA has several inputs and engagements that have to support its sheer size and global running. In specific, IKEA has ambitions to become environmentally sensitive in the production approaches it is taking by the opening of the 2030 financial year (Norton et al., 2021). It is essential to note that IKEA has more than 445 stores worldwide, and as of 2020, the gross profit posted by the company globally crossed the $40 billion mark. IKEA is a one-stop store that stocks a wide variety of home furnishings globally, making it to be one of the most convenient stores for all-around shopping. This is, of course, aided by several external and internal factors that influence the activities of the organization.
There are several factors in the internal orientation of IKEA that the company is able to effectively control with ease and flexibility;-such explains its position on the international market. IKEA has a clear vision that enables it to objectively make decisions in the marketplace (Norton et al., 2021). Here, IKEA has been inconsistent need to add value to its customers and clients through the products that they produce. This has, in turn, resulted in a well-defined business strategy that has aided IKEA to stand out in the market. Simplicity and pioneering into new fields have been some of the undertakings that IKEA has undertaken over the years to make its position as a leading company in the market permanent (Jonsson and Foss, 2021). The approach that IKEA uses to approach its targets is also one of the best approaches in the market. Here, IKEA has been sure that the approach made in the market has been strategic enough to offer the company a grasp of control. To achieve this, IKEA has been keen to arrange, execute, and control its positioning. Strategic positioning, as it turns out, has been one of the greatest strengths of IKEA in the furnishing industry.
Additionally, IKEA has been keen to have a clear concept that translates to its activities and the totality of its engagements. This implies that the company has been investing enough attention in the production process to ensure that the products meet specific needs in the market. Regarding this, IKEA processes a wide variety of products which are assembled by the customers sometimes. Through this, IKEA is able to achieve a wider market scope and post great profits bypassing the assembling costs to the customers (Solanke, 2021). The single-minded focus on cost leadership has aided IKEA in emerging as the world’s leading furniture retailer. It is also evident that IKEA has ways to measure its internal strengths and weaknesses and use them in ensuring that they stay relevant in the industry. With strong policies regarding the execution of customer demands, IKEA has managed to evolve into a company that accounts for the customer’s needs effectively while positioning itself as a giant company and posting decent profits (Norton et al., 2021). Using the analyses, IKEA has also been quick to introduce the changes internally based on the analyses. Using renewable resources to produce their merchandise, smarter use of raw materials, incepting and maintaining long-term relationships with stakeholders (suppliers and retailers), and leveraging the synergies and efficiencies to gain traction through economies of scale.
On the other hand, several external factors are attributed to the success, functionality, and effectiveness of IKEA. First, IKEA has a strong brand name that places it in a better position to relate globally. This has aided IKEA to enjoy comparatively easy adaption and fitting in in the newly founded branches globally (Jonsson and Foss, 2021). Overall, there has been a growing global demand for IKEA products. This has also been fuelled by the increase in demand for environmental-friendly products, which IKEA has actively switched to producing. Coupled with relatively low pricing, IKEA’s path has been carefully and keenly drawn to accommodate for market shifts in demand. Additionally, the conscious attitude to cost results and lower prices has placed IKEA in a better position globally to reap the benefits of campaigns to lower commodity prices (Norton et al., 2021). Additionally, IKEA has been engaged in applying a responsible approach towards being more proactive with entering and exploring new markets. This is also a factor that IKEA enjoys a huge backing in terms of economies of scale gained from the bulk-buying policy. It is also inherently clear that IKEA has invested in regions and localities with excellent infrastructure, -a move that aids in streamlining costs and easing their accessibility.
Section 2
This section will discuss the specific actions and engagements that IKEA has taken into consideration to ensure that they enact theologically and strategically sound HR practices.
Strategic HR Assessment
Strategic HR activities involve the deliberate action-taking by any organization with the aim of attaining better placement in regard to any activities that they aim for. Here, several steps are supposed to be undertaken, and they all refer to specific undertakings in reference to the subject at hand. In staffing, strategic HR staffing is a multi-discipline activity that roams around the activities that individuals in leadership positions (in the HR) undertake with the aim of recruiting the best appointee or employee to fill a specific position in the organization (Solanke, 2021). The activities in IKEA are carried out through smart work designs and intelligent recruitment processes. IKEA has been at the forefront to ensure that there is an effective job simplification and rotation to ensure that the employees are able to execute the roles they are extruded to the best of their abilities.
Job design theory is one of the best practices that IKEA has enacted in its various sections to ensure that the company incepts and maintains high work standards that do not expense the employees (Valentine, 2020). Job design is basically a motivation theory for workplace application that uses the systematic and purposeful tasks of the individuals and subjects within the group. This implies that IKEA has been keen to ensure that the core characteristics that comprise job design skills have been effectively covered within the organization. In IKEA, it is a commonplace practice that skill variety is a workplace quality that is sometimes overemphasized. Here, IKEA seeks to break workplace monotony by integrating the employees in several skills that will aid them to execute their roles without outgrowing them (Valentine, 2020). This way, it has been easy for the company to gain a positive work environment with highly motivated employees. To attain this, IKEA engages its employees in periodic workshops and training sessions that make it easy to introduce skill variety and cross-job collaboration.
Additionally, it is evident that IKEA has been actively into task identity through its objective production tendencies. Through this, it has become possible for the employees to stay motivated and know what is expected of them in terms of output quality and quantity (Jha, 2021). Encouraging the IKEA employees to identify with their tasks has been of great help in articulating work performance, employee motivation, and beating the set timelines. This has also been tied with elucidating the importance of task significance at IKEA. Gaining the projected outcomes in their production is seeded with pointing out what tasks are more important within the organization. Right now, IKEA is motivated towards meeting the environmental goals accounting for reduced emissions, use of recycled materials, and smarter use of raw materials, among several other aims (Abhinav and Sharma, 20210. The employees have been positively integrated to this by the fact of significance attached to the goal.
According to HR specialists, autonomy is one of the factors that measure or expose the level of freedom that the employees are accorded to schedule tasks. Here, it is possible for employees to gain specific flexibility in their roles in case they are able to make decisions. IKEA has exceedingly offered the employees a front and chances in decision making that makes it possible for them to feel appreciated and motivated in their workstations (Atef et al., 2021). A certain level of autonomy is elucidated with triggering employees to have an improved work experience, and consequently lead to a boost in the productivity standards of the employees.
IKEA has also been keen to ensure that there is effective job rotation and simplification. These two approaches have been strategically enhanced in the company to ensure that the activities within IKEA are carried out to desirable extents. Periodic shifting of employees within IKEA has aided in boosting the mood and motivation levels among the staff. Besides enhancing productivity and work collaboration, job rotation at various IKEA stores has been key in ensuring that the employees foster teamwork and proper workplace interactions (Jha et al., 2021). This way, it has been extremely feasible that the IKEA workplace culture will be perpetually passed on the all employees, new and old alike. Job simplification has also been in place to ensure that IKEA’s employees gain positive attitudes and approaches to workplace tasks (Dwivedi et al., 2021). Removing various tasks from existing roles strategically has been one of the inputs that have assisted IKEA to gain control of its employees in product aspects;-maximizing outputs and while minimizing expenditure, costs, and employee effort.
Attaining the above-mentioned benefits in the workplace is a factor of the right selection of employees. This has been integral in IKEA’s success, especially through basing their employee recruitment on intelligent hiring. Here, IKEA’s global hiring criteria are based on specific guidelines that make it possible to choose the best candidates for their various slots (Hewett and Shantz, 2021). Through this, IKEA has been able to cut costs and improve the quality of their workplace alongside triggering positive changes in the overall activities. Employing the right recruits is also an effective way of ensuring that an organization does not spend a lot of time, attention, and resources in training employees.
Theological HR Assessment
Fundamentally, IKEA does not conform to any Christian founding. However, it is evident that the company has been engaged in activities that make it possible to connect biblical viewpoints. According to Keller (2012), there is a need for organizations to ensure that they give back to society. IKEA has been involved in several charity programs that have aided in building the societies and communities surrounding them. One specific issue has been the proactive involvement of IKEA in ensuring that the infrastructure of the areas they open their stores is developed. IKEA foundation is another undertaking that has aided IKEA in accelerating the efforts of various organizations to climate change. IKEA has, in this case, been actively engaged in combating climate change. In their specific vision 2030, IKEA aims to shift to sustainable production that will lead to the inception of a better planet progressively. This is through reduced emissions, recycling, reduced exploitation of non-renewable resources, and smart production.
Besides, IKEA has been actively involved in employee training. Through this, it has become possible to fulfill the presets of the bible where Christ commands Christian to do their best out of learning from him. Keller(2012) attributes proper job training to better outcomes since employees are likely to exert themselves fully into the job and execute their roles to perfection. As Christians, Keller argues that it is important to fulfill the job demands to our best. According to him, this can only be achieved through proper training of the employees, a factor that IKEA has effectively integrated into its operations.
Section 3
Suggested recommendations for improvement
In consideration of the undertakings of IKEA as an organization, there is a need to integrate a few theological and strategic HR interventions to improve its positioning as an organization and the relations it extends to its employees, as well as the output in performance and profits. First, there is a need for IKEA to ensure that the organization creates ways to ensure that information is easily available and dispensable to the employees. This way, it will be easier to create meaningful communication within the workstations. It is also necessary for IKEA to ensure that they incorporate training that is subjectively aimed at specific skills, such as the use of recycled materials to increase work specificity.
Additionally, IKEA should engage in activities that will incept self-managed and effective teams in their work pool by ensuring that the employees conform to groupings that will boost their work output. IKEA should also base its operations on fair performance and fair compensation to its employees. Several claims surfacing in regards to IKEA overworking its employees should be handled through HR incepting biblical nuances on fair employee treatment.
References
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Jonsson, A., & Foss, N. J. (2011). International expansion through flexible replication: Learning from the internationalization experience of IKEA. Journal of International Business Studies, 42(9), 1079-1102.
Keller, T., & Katherine Leary Alsdorf. (2016). Every good endeavor: connecting your work to God’s work. Penguin Books.
Norton, M. I., Mochon, D., & Ariely, D. (2012). The IKEA effect: When labor leads to love. Journal of consumer psychology, 22(3), 453-460.
Solanki, K. (2021). ANALYSIS OF THE HR AND CUSTOMER-RELATED CHALLENGES FACED BY IKEA IN THE UAE MARKET DUE TO CROSS-CULTURE DIFFERENCES. International Journal of Entrepreneurship, 25(1), 1-12.
Valentine, S., Mathis, R. L., Jackson, J. H., & Meglich, P. A. (2020). Human resource management. Cengage Learning.
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