1. Rennes International School of Business
ESC RENNES
Executive Master of Business Administration
EMBA
COHORT 1 (2003 - 2004)
INTERNATIONAL BUSINESS
Conducted by:
Jamie SMITH
IKEA Case Report
By
Magdy A. Sattar
February, 2004
Cairo, Egypt

2. IKEA CASE
1. What have been the key success factors for IKEA's global expansion?
 Development of unique product design capabilities inspired from
the Swedish culture with an international appeal.
 Balancing customer requirements of a good designed furniture at a
law price with the supplier need for profit through efficiency and
long production runs.
 New and bold ideas and strategies of marketing (catalogues),
Human resource (learning by Doing) Cost reduction (knocking
down furniture).
2. In what ways has the international culture been a challenge for IKEA?
 Though IKEA has been in Germany since 1974 German
employees still perceive the IKEA WAY as peculiar, obviously it
did not satisfy their needs of precise and firm work environment
until now.
 An announcement board was the action taken to satisfy the French
employees need for formal, clear communication procedures.
 In north America it toke five years to appeal to the American
customer and conceive his needs
 Turn over in the American employees is high in spite of IKEA
career security simply for the lake of career clarity.
3. What are the three things that IKEA had to learn in order to do
business effectively in the United States?
 American household’s characteristics.
 American buyer preferences.
 American administration tools.
4. How well has the company been able to deal with the diversity issue?
Diversity issue is not perceived as an obstacle by the Swedish ikeaans at
all. Except in a certain circumstances where the diversity issue is brought
up very clearly, (American cases of the dinning room and display floor
redesigning).

3. 5. What else does it still need to do?
 Clear interpretation and communication of the constitution of
IKEA (IKEA WAY) to all Coworkers.
 Regional offices equipped with training centers and professional
trainers.
 Clear H/R policy (job description, career development).
6. What are the main challenges that IKEA faces for the future?
 Drifting away from the roots of IKEA without being able to adapt
or embrace a new or clear way
 The very thing that made IKEA what it is and holds it together is
its founder Ingvar Kampard , How much more can he keeps it
together?
 Competition is getting tougher as Local competitors is getting
tougher
 Turn over among employees