CASE STUDY

Group 1
Abainza, Raymart N.
Aleria, Maybelle S.
Boyles, Glenn G.
Caban, Ivy S.
Calpito, Marivel G.
Celestial, Renalyn A.
Clamor, Alexis Clemen C.
Cornites, Allyn S.
Guerrero, Eunice Angel Joy M.
BSA 3-1

Submitted to:
Professor Maria Luisa U. Oliveros
TABLE OF CONTENTS
I. Introduction
II. Product Development
III. Operation Management Issues
A. Location
B. Layout
C. Process Design
D. Supply Chain Management
E. Inventory Management
F. Quality
G. Forecasting
H. Scheduling
I. Product Design
J. Human Resources
I. INTRODUCTION
IKEA is the largest and well-known furnishing brand in the world, recognized for its flat

packaging, self-assembly furniture with its Scandinavian style at a low cost. It has grown rapidly

since it was founded in 1943. Ingvar Kamprad, was just 17 years old when he founded IKEA,

used the money his father gave him for doing good in his studies as a capital to the business he

really wanted to build.

IKEA was named after the founder’s initials; I- Ingvar, K- Kamprad, E- Elmtaryd, A-

Agunaryd. Elmtaryd is a small farm in the village of Agunaryd, Smaland, Sweden; the place where

Ingvar lives. At the age of five, Ingvar was already selling matches and at the age of seven, he

already realized that he can buy matches in bulk cheaply and re-sell them individually at a very

low price but still make a good profit. At a very young age, he already understood the concept of

discounting. From matches, he expands to selling pens, wallets, picture frames, table runners,

watches, jewellery and nylon stockings- meeting the needs of his customers with products at a

reduced price.

It was in the year 1948 when furniture was introduced to IKEA range. The furniture was

produced by local manufacturers in the forest close to Ingvar Kamprad’s home. The response is

positive and the line expands. However, the location of IKEA is a remote area, far from the city

and to the potential customers. Ingvar Kamprad sees the opportunity to sell furniture on a larger

scale using catalogue, which was first published in 1951. Customers doubted and were not

convinced by the quality a low-priced furniture can offer. So in 1953, IKEA opened a furniture

showroom in Almhult, Sweden. It is an important moment in the development of the IKEA concept

because the customers can already see and touch the furnitures before ordering them. Ingvar
also took the opportunity to talk to his customers and clearly demonstrate to them the functions

and the quality their low-price products can offer.

Innovation was successful until opening their first IKEA store in Sweden in 1958 was made

possible, with IKEA’s own furniture design and their flat-pack and self-assemble furniture concept.

IKEA’s vision ‘’ TO CREATE A BETTER EVERYDAY LIFE FOR MANY PEOPLE’’. Their

business idea supports this vision by offering a wide range of well-designed, functional home

furnishing products at prices so low that as many people as possible will be able to afford them.
II. PRODUCT DEVELOPMENT
IKEA has three steps in the process of designing and developing its product.

The first step is to set a price the product is going to sell for. The product

development begins with designers, product developers, and purchasers getting together

and brainstorming the materials, design, and suppliers. When the price is given many

factors come into play, design, material, color and other factors. The product is then

designed around those factors and numbers.

The second step is to choose a manufacturer. IKEA’s goals are to produce its

products with the least amount of packaging, air in between products during

transportation, which has a very important part in being cost effective. It is very important

for the company that working conditions and environmental awareness are being

conducted.

Therefore, it developed a code of conduct for those factors. The IKEA Trading

Service of Conduct controls and oversees manufacturer working conditions for

employees and makes sure no child labor and other thing occur. Manufacturers are

screened on a regular basis.

The third step is to design the product. IKEA uses internal competition to design

its products; designers get the chance to show their talent when a new product is being

developed. The goal is to design a product that is very functional at a minimum cost.
III.OPERATIONS MANAGEMENT
ISSUES
A. LOCATION
B. LAYOUT

Store layout helps influence a customer behavior, which means it’s a key strategy to stores

prosperity. Stores owners choose where the best spots are to place their merchandise, and this

helps to design their customer flow. IKEA is designed around a one-way layout. This format is

designed to encourage the customers to see the store in it’s entirely, although there are often

shortcuts to other parts of the store. And the showroom was divided into subsections depending

on the type of furniture’s displayed, and set up to its very last details along every aisle. And almost

seem like beckoning the shoppers to explore each of the display area. IKEA has a self-service

warehouse where the customers are the one who managed to get the item in flat packed form.

IKEA is two steps ahead to their customers so they decided to put a restaurant inside the

store because they know that customer will be tired and hungry after shopping. And most of the

IKEA stores have a play area called Smaland for the children aged 3 to 10 years old and the

service offered is completely free of charge. IKEA has artfully placed selections of supplementary

goods on the staircase landing the to utilize the space and leads to impulse purchases. A lift is

also provided for shoppers with trolleys or the handicapped to get to the lower level with ease.

In the book of Stevenson IKEA uses retail store layout. The types of retail store layout are

forced path layout, loop layout and grid layout. The types of retail store layout that IKEA used are

the force path layout and loop layout. The force path layout is popularized by IKEA, with a single

main aisle running through the store. This layout forces the customer to walk entirely the store

and it maximizes the exposure of each and every peices of merchandise to the customer path or

flow and it increases sales.

 While the loop layout shares a lot in common with force path thats why they also use this

kind of retail store layout to encourage tge customers to circle around the store and visit a different

areas or departments within the retail spaces.

C. PROCESS DESIGN
D. SUPPLY CHAIN MANAGEMENT

Another area of operations management that is focused by the company is supply chain

management. The products that are produced by the company are good quality products, and

their cost is also low as compared to the other organization. The current IKEA supply chain

management system is designed in such a way that it can control and handle its own designing,

manufacturing and warehousing. IKEA’s supply chain management is spread globally with the

purpose of both sales and purchasing in all the major regions of the world. The supply chain

management of IKEA involves three sectors, which are the primary, secondary, and tertiary

sector. These sectors include raw materials that are required in the process of manufacturing

products, distribution of products, and retail sales to the end customers.

The goal of supply chain management is to organize operations in primary, secondary and

tertiary sector in order to have a positive impact on the environment. The primary sector provides

raw materials to the organization. IKEA accepts only those raw materials that match the quality

standards that are set by the organization. The primary sector extracts and develops natural

resources such. The secondary sector makes the use of raw materials that are obtained from the

primary sector in order to build, manufacture, and develop finished goods. IKEA makes use of

these raw materials to design new products at a lower cost to attract customers. The tertiary

sector performs the distribution of products to the suppliers. This sector provides the services that

are required to fulfil the needs of the customers in the form of retailing, distribution, insurance, as

well as customer services.

Flow management, ethical supply chain code and logistics are the strategy of Ikea in their

supply chain management. Flow manage is one of the strategy that the Ikea use because it

involve the product and service, information flow and the financial flow of their business. Next is
the ethical supple chain code, a code that could cover the behavior of involve customers,

suppliers, supplier’s behavior and the environmental issues that every company should develop

it. A code of conduct is basically a set of rules that say what is acceptable or considered proper

practice for an individual or organization. That is why Ikea adhering to their code of conduct IWAY,

mean that not only make good products and inexpensive but also to promote innovation, social

and environmental advances. And lastly, Logistics it refers to the movement of materials, services,

cash, and includes the movement of a facility, overseeing incoming and outgoing shipments of

goods and materials, and information flow throughout the supply chain. That is why Ikea ensure

the lowest cost, and strictly control of every aspect of the logistics, such as has been carrying out

“flat packaging”, save a large number of products coarse pack cost to reduce the transportation

cost and improve efficiency purpose. In order to save transportation time, “Ikea” in global nearly

20 distribution center and some central warehouse mostly concentrated in the sea and air traffic

arteries, “Ikea” through the scientific calculation in order to decide which products in the local

manufacturing sales, which export to overseas shop.

E. INVENTORY MANAGEMENT

 Do-It-Yourself assembly lowers packaging costs

Most IKEA furniture is designed and sold in pieces for the customer to assemble. The pieces

are placed into convenient and efficient, flat packages for low-cost transport because they take

up less room in trucks, maximizing the number of products that can be shipped and minimizing

order fulfillment costs.

The unique packaging also takes up less space in warehouse bins and reserve racks, allowing

for more room to stock additional items for order fulfillment. What the company saves in fuel

and holding costs is passed on to customers.

Designing furniture for flat packs and self-assembly started in 1956. The decision for IKEA to

design its own furniture stems, ironically from competitors pressure for suppliers to boycott IKEA.

Exploration of flat packaging begins when one of the first IKEA co-workers removes the legs of

the LÖVET table so that it will fit into a car and avoid damage during transit. After this discovery

flat packs and self-assembly become part of the concept.

Two years after starting IKEA, Kamprad began using milk trucks to deliver his goods. In 1947,

he started selling furniture made by local manufacturers. By 1955, manufacturers began

boycotting IKEA, protesting against Kamprad’s low prices. This forced him to design items in-

house.

Kamprad was also behind the simple, yet revolutionary innovation that is the flat pack. He

began selling IKEA products in flat-pack form, from his own warehouses. Thus the basic IKEA
concept – simple, affordable flat-pack furniture, designed, distributed and sold in-house – was

complete.

The driving idea behind IKEA was, and is, that anyone should be able to afford stylish,

modernist furniture. Kamprad felt he was not just cutting costs and making money, but serving

the people as well.

 Cost-per-touch inventory tactic

Having customers select the furniture and retrieve the packages themselves is an inventory

management tactic called ‘cost-per-touch’. As a rule of thumb, companies find that the more

hands touch the product, the more costs are associated with it. For example, imagine when

someone selects a piece of furniture to buy. The item is then ordered, shipped from the

manufacturer, moved from the delivery truck into storage in the warehouse, moved from the

warehouse to the customer’s vehicle or delivered by the furniture retailer to the customer’s home.

Every time the product is shipped, moved, and loaded; it costs money. The fewer times someone

moves or touches the item, the fewer costs are associated with it. IKEA saves costs with this

guiding principle to minimize touches because it doesn’t have to pay the customer to retrieve the

furniture and take it home.

Handling costs are the costs of of holding goods in stock. They are typically expressed as a

percentage of your inventory value. While technically handling costs include everything from

insurance and storage to taxation and obsolescence, a more obscure handling cost you should

be aware of was made famous by furniture maker IKEA: cost-per-touch. IKEA implemented a

cost-per-touch inventory strategy after understanding that every time a product is touched

(whether by human or machine), that touch costs money.

 IKEA minimizes touches per product throughout its supply chain. For starters, most of its

furniture comes in flat packaging. For the customer, it makes transferring the furniture home easy.

For IKEA, it means that products can be easily stacked and moved by machines for fewer touches.

Next, IKEA’s warehousing operations share the same space as IKEA retail stores. The result is

customers pick up their own products, eliminating further touches for home delivery. Customers

generally see these two IKEA concepts as perks to the consumer. But for IKEA, both strategies

greatly reduce the number of touch points from production to end user delivery.

Cost-per-touch is now a commonly tracked metric. As a rule of thumb, you can estimate $1-2

per touch for a product and $3-4 per touch of a pallet. Those costs apply to both inbound and

outbound deliveries, as well as movement around a warehouse. Obviously, actual numbers will

vary per product, per industry, and per company. To give a ballpark range across industries, the

cost-per-touch for a product is 2-5% of the inventory value.

 Usage of high-flow & low-flow warehouse facilities

The facilities at your local IKEA are either high-flow or low-flow. High-flow refers to the 20%

of SKUS that make up 80% of the IKEA inventory volume. These products sell quickly, are easily

accessible for self-service, and use inventory tracking. If you don’t need help from an employee

to move items, that saves them time. Automatic storage decreases costs and cost-per-touch. If

items at your local IKEA are easy to find and grab, chances are they’re high-flow.

In contrast, low-flow refers to items that are slower to sell. Thus, these items don’t get as much

movement. This relates back to cost-per-touch. If employees are often moving low-flow items, this

drives up costs. For low-flow items, manual processes are used since there is less movement.

Through the use of an inventory system, IKEA uses labour effectively. By having products in the

right place, IKEA employees don’t need to waste time on these activities.
 In-store logistics

IKEA also relies on something rare and unique concerning its logistical management of

reordering products – it employs in-store logistics personnel to handle inventory management at

its stores. According to the ARC Advisory Group (professionals and consultants on logistical and

supply chain operations), there is an in-store logistics manager responsible for the ordering

process and a store goods manager responsible for material handling logistics at all IKEA stores.

The duties of the logistics personnel are to monitor and record deliveries, carefully check

delivery notices, sort and separate the goods, and get them off to the correct sales area or

designated overstock locations. Overall, they ensure an efficient flow of goods within IKEA stores,

which is essential to maintaining high sales and enhancing customer loyalty.

 Maximum/minimum settings as a proprietary system

The in-store logistics managers use an inventory replenishment management process

developed by IKEA called ‘minimum/maximum settings’ to respond to store-level inventory

reorder points and reorder products.

Minimum settings: The minimum amount of products available before reordering.

Maximum settings: The maximum amount of a particular product to order at one time.

Since all IKEA inventory is only stocked at night after opening hours, the logic of its min/max

settings is based on the number of products that will be sold from the reserve stack of the bin in

a single day or two-day period. The process meets customer demand while minimizing ordering

too few or too many products.

This strategy also ensures that IKEA has inventory ready to meet customers’ demands,

lowering the cost of lost sales.

 Using IKEA’s proprietary inventory system, logistics managers know what is sold through

point-of-sale (POS) data and how much inventory comes into the store through direct shipping,

and from distribution centers through warehouse management system data. Using this data, they

can forecast sales for the next couple of days and order in the suitable amount of products to

meet that demand.

If the sales data doesn’t match the projected number of items that should have been sold

that day, the logistics manager goes directly to the pallet and bin to do a manual stocktake.

IKEA believes its process and system allows for the right goods to be in the store with

greater certainty, and at a lower cost, than the traditional retail forecasting and replenishment

process.
F. QUALITY

Quality according to Bergman and Klefsjö, 2010, could be defined as the ability for the

expectations and needs of the customers to be satisfied and exceeded. IKEA’s simple business

strategy of low prices has created a lot of trouble for the organization. By lowering prices, the

quality of products offered lowered and although the organization has been thriving to maintain

its quality it has sometimes been unable to meet international standards. The products are also a

little below quality but their quest for lowering prices has also affected their quality of service

offered. Customer care does not get proper attention and the workers do not have the time or

resources for proper international training (Levine, 2010).

The core values of Total Quality Management are applied to the concepts of IKEA’s quality.

IKEA takes the responsibility of providing affordable good quality of furnishing products . Through

Supplier Quality Assurance Program, IKEA enforces its suppliers to comply with their standards.

Suppliers quality assurance program ensures that the suppliers are reliably supplying goods or

services that will surely satisfy the customers needs. This process is collaborative to ensure

supplier offerings meet the agreed-upon requirements with minimum inspection and modification.

IKEA represents one of the core values of TQM whereby everybody, including the suppliers

contributes in the value creation process is supposed to be involved in the terms of quality control

and development. That includes suppliers as core actors in value creation systems.

IKEA introduce suppliers quality assurance program as blueprint for suppliers to comply with

before integrating them. Decision value of TQM could be clearly seen in how much IKEA puts

high pressure on documentations and procedures required for suppliers to be integrated. A model

called IKEA quality staircase model is used to filter the qualified suppliers to be internalized. This

model have 4 steps that the suppliers need to consider and it starts with QMUST (entry
requirements to be fulfilled before going further), QWAY ( subsequent requirements need to be

fulfilled within timeframe when the process starts), 4SIP ( supplier inspection program for

suppliers with ambition to further develop their quality systems) and lastly, ISO 9001+ 4SIP. IKEA

also uses ‘’ Customer Experienced Product Quality (CEPQ)’’ as concept to describe the

expectations of customers on the products or services aspects that may experience and assess.

These aspects encompasses areas such as HEALTHY ( renewable materials,free from harmful

chemicals.. etc), CUSTOMER FRIENDLY ( easy to assemble ad install..etc), DURABLE AND

FUNCTIONAL ( durable surfaces, good workmanship..etc)

IKEA group is one of the leading companies that gained the success of integrating quality as

management system, IKEA use robust engineering and marketing tools to meet and exceed

customers expectation. Moreover, IKEA adopts intolerant partnership policies with suppliers. That

could be seen clearly from IKEA suppliers quality assurance program that has been set to make

sure that IKEA grows in appropriate manner whereby all new integrated suppliers are eligible to

hold the responsibility of IKEA’s quality level.

This is how IKEA puts an effort to allocate through TQM as quality management system to

keep its quality levels up and continuously improve them. Quality management systems are

characterized by high degree of bureaucracy whereby creativity is quite inhibited under.

G. FORECASTING

It was identified that all forecast for the products in the world was created at IKEA of

Sweden in Älmhult. The demand planner explained that their main objective is to determine all

forecasts for every product available in IKEA all over the world,which are about 30000 articles.

However, these forecast are only determined on a global, regional and national level, all IKEA

stores in the world have to adjust the IKEA of Sweden forecast. In IKEA Jönköping, one of the

branches of IKEA in Sweden, the divison Sale Supply System adjust and manage the forecast at

a local level. The forecast are managed manually by demand planners and automatic by the Sales

Response System. Sales Response System forecast demand and automatically order a proper

amount of products. The forecast are based on historical data, seasonality from previous sales

and combined with the moving average. The demand planners makes daily inpits and

adjustments about demand and forecast to Sales Response System to increase forecast

accuracy.

Their concept of their forecasting strategy can be found in the book of Operations

Management 13th Edition by William J. Stevenson. Wherein the historical data as the basis of

IKEA is one of the forecasting techniques that is called time-series forecast. Time-series forecasts

simply attempt to project past experience into the future. These techniques use historical data

with the assumption that the future will be like the past. In the analysis of the time-series data

requires the analyst to identify the underlying behavior of the series. This can often be

accomplished by merely plotting the data and visually examining the plot. One or more patterns

might appear: trends,seasonal variations, or varations around an average. The seasonality is one

of the basis of IKEA.

 Averaging techniques generate forecasts that reflect recent values of time series (e.g., the

average value over the last several periods). These techniques work best when a series tends to

vary around an average, although they also can handle step changes or gradual changes in the

level of the series. One of the three averaging techniques that IKEA is using is the moving avergae

that averages a number of recent actual values, updated as new values become available.
H. SCHEDULING

The scheduling process of IKEA is mainly divided into three phases. The first phase is the

product design process, which includes four different criteria that every product must meet to be

available for the customers. The criteria include affordability, sustainability, good design and

functionality. The scheduling operation starts by assigning a price to its product that is to be sold.

For this purpose, the designers select the elements, raw materials and production techniques for

reducing the overall production cost. IKEA selects only limited raw materials for manufacturing

different products, which results in lower rates of defects, which in turn, reduces waste and cost.

The second phase is production and distribution.

The spreading of production demand allows the suppliers to have uniform time, which

leads to lower production cost per unit. IKEA applies the strategy of packing the products into flat

packets, which helps the company in optimizing warehousing and transportation costs. This

enables easy transportation of goods and products and easy storage, which leads to decreased

transportation costs and decreased labor cost. The third phase is the retail phase, in which IKEA

does not need to hire any labor as the customers are responsible for picking up the products

themselves. The customers also transport the furniture out of the store, and this saves labor,

overhead and shipping cost, which is associated with assembly and delivery

The strategies use by IKEA adhere to the concept of “Intermediate Volume System”; as it

not pertain to the category of “High-Volume System” because IKEA has different product and is

not repetitive in nature when it comes to manufacturing it, and also does refer to the category of

“Low-Volume System” because IKEA is not a made-to-order type of business. Intermediate

volume system falls between these two.

 Just like high-volume system, intermediate volume system mass produces its product but

not as large as in high-volume system. When it comes to the part of low-volume system,

intermediate-volume system treats the customization of the product for stock rather than a special

order. IKEA customizes its product based on the customer needs and demands, and then mass

produce it.
I. HUMAN RESOURCE

Human resource (HR) management is designing management systems to ensure that

human talent is used effectively and efficiently to accomplish organizational goals. It includes the

process of employing people, training them, compensating them, developing policies relating to

them, and developing strategies to retain them.

Human resources management (HRM) has evolved over the decades to become a

strategic, integrated and coherent approach to the employment, development and well-being off

the people working in an organization.

A key description of IKEA HR style of management is that a strategy for HRM is included

largely in its corporate strategy. Notably, the IKEA business strategy has evolved over a number

of years comprising of creative and innovative designs at affordable cost.

Recruitment and Selection. Based on the Human Resource Management 12th Edition

Book of Robert L. Mathis and John H. Jackson, recruiting is the process of generating a pool of

qualified applicants for organizational jobs. Choosing the right people for the right job.

Recruitment and selection are one of the core activities of HR planning, a dynamic

procedure and a crucial task for the company’s success. IKEA management understands the

importance of acquiring, engaging and retaining employees and customers in order to grow their

business through sustainability. The case study has highlighted that IKEA has focused at

recruiting and selecting new employees that share similar values and beliefs so that they do not

have any problem in integrating into the corporate culture of the company and facilitate the

process of achieving strategic goals of the company.

 Hiring should involve transparent recruitment procedures with no favoritism or nepotism.

In order for an organization to choose the right candidate and promote cultural embeddedness

the recruitment procedures should be built with this on mind.

IKEA has a policy of hiring based on values as well as on skills. The company is looking

for people with enthusiasm and togetherness, persistence and humbleness, ready to take

responsibilities and accept challenges from day one. They are all in business together and

potential employees, called co-workers in IKEA, should demonstrate that they are ethical,

creative, encourage diversity, and are willing to collaborate together to overcome everyday

challenges and problems.

Training and Development. According to Armstrong (2006, p. 531), Human Resource

development (HRD) is concerned with provision of learning, development and training

opportunities in order to improve individual, team and organizational performance. Training is

referred to as planned acquisition of knowledge, skills and attitudes required to perform well in a

given role, Gunnigle et al (2006), development is the acquisition of skills and abilities that are

required for future roles in the organization. IKEA encouraged its employees to pursue courses

that had potential application to retail sector and also gave bonus for employees who stayed with

the company for one year.

After selecting the right talent for the organization’s positions, the HRM team has the

responsibility to provide training and development. This is the only way for people to grow with

the company. Training can also give more meaning in their work experience. Having happy and

satisfied employees in a safe and inspirational work place is a necessary condition in which to

also have satisfied customers; this in turn leads to organizational success.

Mentoring is one of the key techniques used by IKEA in deciding training and development

requirements of each individual. Spiers-Lopez said mentoring made employees feel supported,
and helped them grow within the company. Gibb (1994) has defined mentoring as “a relationship

in which an individual takes a personal interest in another’s career and guides or sponsors that

person” (p. 47). Drawing upon David (2004), mentoring can be linked with career advancements

and mobility, especially for the minorities and women. Therefore, it should be highlighted that the

method is being successfully used within IKEA to wholly motivate workforce to stay with the

company. The ongoing training also helped employees to stay in touch with the latest within the

industry and also to benchmark their performance against best practices across different

industries.

At IKEA, training starts from day one and it involves the rotation through various areas of

the business. This provides a better understanding of the business and thus employees are able

to serve their customers more effectively.

J. PRODUCT DESIGN

In order to reach the shop floor of IKEA, a product must meet the five dimensions: affordable,

sustainable, form, function, and quality. The design planning of any product start by setting a price

at which product will be sold. As part of that, designers have to select which element, raw

materials and production techniques to use in order to reduce production cost. Furthermore, the

designers often work on the factory floor, directly interacting with the manufacturing team in order

to understand the capabilities and constraint of manufacturing department, thereby streamlining

the design process and minimizing the cost of the prototyping phase.

IKEA first get the insights of their customer by using mixture of qualitative and quantitative

research. IKEA do it by conducting a survey in social media, home interviews, consulting the

experts, and surveying people around the world.

Then they consider the sustainable design, that will helps reduce the maximum amount of cost

as IKEA reduces the consumption of wood and focuses more on developing a design solution

that includes the use of recycled plastics. Sustainability is another facet of achieving the broader

good for all people and is compatible with its vision to provide a quality product at a low price.

IKEA considers the phenomenon of sustainability to be an essential part of the corporate roots.

The company is committed to its People and Planet Positive strategy that is directly connected

with the process of becoming resource and energy independent as they actively invest in solar

and wind energy production.

Much of IKEA’s furniture is designed to be assembled by the consumer rather than being sold

pre-assembled. This permits them to reduce the costs and use of packaging by not shipping air.

This flat-packed form of products helps to increase the supply chain as they are easy to carry for

the suppliers as well as the consumers. IKEA contends that it has been a pioneering force in
sustainable approaches to mass consumer. Ingvar Kamprad refers to the concept as “democratic

design”, meaning the company applies an integrated approach to manufacturing and design. This

target merges with the sustainability strategy to make everyone’s home environmental friendly by

saving energy, reduce waste, and depend on more recycled and renewable materials.

IKEA incorporates numerous product design techniques of different types in order to make the

business activity efficient and the customer satisfied. Product lifecycle, according to IKEA’s

philosophy, predetermines constant improvement and adjustment at every stage of the life cycle.

The evidence of such an approach is determined by IKEA is the Never Ending List that is

published at the company’s official website.

The company also considers the effects of legal considerations under the terms of the

responsibility of the manufacturer in case of any damage or injury caused by the faulty furniture

item. Ethical considerations are always followed by IKEA as far as the quality and convenience

are the key issues of concern for the company. Therefore, the furniture designed by IKEA are

constantly improved in order to be of appropriate high quality and align with the consumer’s

expectations.

IKEA strategies refer to the concepts of idea generation, legal and ethical consideration, and

environmental factors. Idea generation because, they conduct a research before they design their

product. Just like in “research and development” that discuss the innovation of products through

scientific knowledge. Legal and ethical consideration because they consider their responsibility

when the products they sell has damage or what we call the “product liability”. Under

environmental factors, it refers to the; cradle-to-grave assessment because IKEA consider their

use of material if it will affect the environment; and Reduce: Value Analysis because IKEA

chooses a high quality materials and then they mix it with recycled materials.