Ikea Operation Management Strategy

1105 Words 5 Pages
The Scandinavian company IKEA is a globally retailing enterprise that sells furniture. IKEA is ruled by Ingvar Kamprad and has already made him the richest person in Europe. The sole operation management and the innovation in furniture retailing provided the popularity to IKEA worldwide. Even though the company has a variety of competitors, it remains leader due to its exclusive saving cost techniques, operating models, and unique conceptualized stores.
In order to save cost, IKEA Company has implemented three techniques. The first strategy that helps IKEA to save mpney is its democratic and functional design. The company does not splash into expensive materials which are not visible for the customers because allocate in the back of the furniture
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The managers and designers use the innovative techniques, modern fashionable colors, and the latest trends in managing the design of a store. Moreover, their operational management is concentrated on making the customers comfortable within the shop. Therefore, everybody can touch pieces displayed in the store. When the competitors are concerned with the customers’ service, IKEA’s operation management makes consumers simultaneously producers and consumers, as the majority of products are self-assemble. The managers and employees can advise and answer the questions, but the process of ordering, picking up, transporting and assembling the selections remain on the customer.
IKEA’s managers know their target customers. The first group is the young adults from middle income families. Another segment is businesspersons who run small offices. Therefore, the operation management is focused on satisfying needs of both groups. Generally, the operation system within the store is focused on the customers’ assistance in buying chain. By doing so, the company saves money and keeps the lowest prices in the
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The foremost goal of this strategy is to reduce the waiting time of the profitable customers and manage it to gain lucrative advantages. Therefore, the company’s main complementary service elements are large and unique store, restaurant café, and the area for children (Holland & Ross, 114). Moreover, IKEA uses unique stores to facilitate complementary services by encouraging the visitors to spend their precious time and feel comfortable with the company’s products. Indeed, every customer may lay down, sit, open & close drawers, compare styles and prices within the store. The primary goal of this service is to make visiting of IKEA comfortable for clients, as they would enjoy the complementary services (Holland & Ross, 114). Thus, the company’s unique competitive advantage is the managing demand by giving the sense that the customers do not spend time in vain, waiting in queues. Instead, they are suggested to have a dinner in a restaurant or café. The children who are not fancy shopping can spend time in special playing areas. By implementing these unique techniques, IKEA Company has converted the disadvantage of the store, such as spending time in queues, into a profitable advantage, by differentiation the complementary service

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