Bus 5117 Discussion Assignment Unit 1-07

Strategic management is the process by which organizations use their capabilities and
resources to provide superior performance. It creates a framework for a business to set a

course for its success. The strategies used are devised from an analysis of the internal,
external, and competitive environments that an organization faces. Successful business
use strategic management to help achieve their goals(Kennedy, 2020). In this paper I will
analyze the strategic management process for IKEA, which is among the world's most
successful retail companies.
Strategic management looks at how certain actions and events influence a companies
failure or success. Understanding and mastering strategy is a key element in this
process. Though formal tools do exist in the field of strategic management, much of this
also involves a certain amount of creativity that makes the process both art and science.
Strategy can be defined as the varying kinds of activities and processes within an
organization (Kennedy, 2020). This involves the objectives and goals that a business
must achieve in order to be successful. It looks at how the actions of top executives and
the planned allocation of resources influences success or failure. The development of
these goals is what requires a strategic management process in order to be carried out
and implemented successfully.
While other companies may spend time studying current trends, what makes IKEA’s
approach different is its focus on how people actually live. The company regularly
studies people in their homes. They take photographs and notes of intimate details
about how people lead their lives. Researchers and designers pay close attention to the
habits, routines, and wants of their consumers (Yohn, 2015). The company’s specific
design philosophies are also a huge part of how it approaches branding and marketing
(Yohn, 2015). It is also an incredibly distinctive and recognizable brand. According to its
North American Chief Marketing Officer, Leontynd Green Sykes, the company’s specific
design philosophies are also a huge part of how it also approaches branding and
marketing (Yohn, 2015).
What has just been described above is a part of IKEA’s intended strategy. Intended
strategy is what an organization hopes to achieve and is part of an organizations
strategic plan. Emergent strategy is what emerges in response to unexpected challenges
or opportunities. While realized strategy is what a business or organization actually
follows. The most significant weaknesses facing IKEA are the decreasing quality of its
products and the negative publicity the company has received in recent years. It appears
that IKEA has not been able to find a medium between offering products at reasonable
prices and maintaining quality.
IKEA’s emergent strategy has been to counteract the negative press it has received in
recent years by working to improve the quality of their items. What has always made the
company innovative is its ability to provide quality products that are affordable (Yohn,
2015). IKEA's key strengths are customer knowledge, the use of innovation to drive costs
down, supply chain integration, brand reputation and market presence, and a diversified
product portfolio. It appears that IKEA has struggled to find a medium between offering
products at reasonable prices and maintaining quality. Unfortunately, this has meant
that the caliber of its items has suffered. Research had shown that the brand's customers
were generally more unhappy with the products and services they have received at a
much higher rate than the average customer at other retailers. The cost reduction efforts
IKEA had undertaken meant a decline in the standard of materials and craftsmanship.
This led to more unhappy customers and higher number of returned items, which
damaged the brand's reputation (Jurevicius, 2021). In recent years the company has
learned that offering quality is what keeps customers coming back and has worked on
improving the caliber of its items. This has become an important aspect of the brands
realized strategy.
REFERENCES
about us. (2021).
IKEA. https://www.ikea.com/us/en/this-is-ikea/about-us/https://www.ikea.com/us/en/
this-is-ikea/about-us/
Kennedy, R. (2020). Strategic management. Virginia Tech Publishing. Retrieved

from: https://vtechworks.lib.vt.edu/handle/10919/9928
Fernado, J. (2021, August 19). Stakeholder. Retrieved

from: https://www.investopedia.com/terms/s/stakeholder.asp
Jurevicius, O. (2021, October 22). SWOT analysis of IKEA. SM Insight.
https://strategicmanagementinsight.com/swot-analyses/ikea-swot-analysis/
Kwun, A. (2018, December 28). 5 retail lessons from IKEA’s wild year. Fast Company.
Retrieved from: https://www.fastcompany.com/90281245/5-retail-lessons-from-ikeas-
wild-year
Yohn, D. L. (2015, June 10). How IKEA designs its brand success.

Forbes.com Https://www.forbes.com/sites/deniselyohn/2015/06/10/how-ikea-designs
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Bus 5117 Discussion Assignment Unit 1-07

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Bus 5117 Discussion Assignment Unit 1-07

Uploaded by

Strategic management is the process by which organizations use their capabilities and

resources to provide superior performance. It creates a framework for a business to set a

Kennedy, R. (2020). Strategic management. Virginia Tech Publishing. Retrieved

Fernado, J. (2021, August 19). Stakeholder. Retrieved

Yohn, D. L. (2015, June 10). How IKEA designs its brand success.

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