Wednesday, November 16, 2011

HUY Quy, JARRETT Michael, DUKE Lisa
How IKEA's Strategy Was Formed
© 2011 INSEAD Case Study

This case describes how IKEA's distinctive strategy was formed over a period of about 30 years (late 1940s to late 1970s). It describes how the various elements of its strategy were created gradually, with the help of many people other than the founder Kamprad, and how these elements were ultimately integrated with each other thanks to the creation of IKEA's organizational culture that came much later.
Pedagogical Objectives: The case illustrates a process view of strategy creation. Many students of strategy think that an integrated and effective strategy is the outcome of some systematic, highly analytical process performed centrally by a group of strategic planners. In fact, this case shows how it can emerge from a series of creative small steps by frontline managers, overcoming constraints one by one, over 30 years in a highly competitive industry. Despite the competitive environment, creative strategies continue to emerge through persistent attempts to circumvent existing barriers.