"Profit is a wonderful Word"
Citation of Ingvar Kamprad (Burghard, 2003)

IKEA´s Strategy behind the Profit

Thursday 17 February 2005

Words: 2738 (excl. references)

CONTENTS

INTRODUCTION ... 2

OVERVIEW OF THE COMPANY IKEA... 2

Company Profile of IKEA...2

History of IKEA ...3

THE "IKEA WAY" - CREATION OF LOW COSTS... 4

IDENTIFYING THE STRATEGY OF IKEA... 6

Porter´s Five Forces...6

Porter´s Generic Strategies...8

Bowman´s Strategic Clock ...11

Internationalization of IKEA ...12

IMPLICATION OF THE ANALYSIS...13

CONCLUSION...13

REFERENCES...15

INTRODUCTION

In the following research essay, the IKEA organization as a cost-leader with a mixed strategic approach will be analysed. For exposing and identifying the strategy it is important to understand background and history. Therefore, a brief overview will be given. Afterwards, the IKEA way of reducing costs will be described to underline potential strategic positions. Furthermore, key strategic issues, facing IKEA as it seeks to generate and sustain competitive advantages will be identified. In order to analyse IKEA´s strategic position,theoretical frameworks and concepts will be used. Likewise, these frameworks will be critically evaluated in adaptation to the case. Finally, the IKEA strategy will be categorized and a general strategic approach will be highlighted.

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