Supply chain – Ikea case study 

1- At what level of supply chain integration maturity is IKEA? (Refer to the supply chain
maturity model in chapter 6). Explain your answer with evidence from the case?
 
I am confused between LINKED and INTEGRATED level, but I will go with the
INTEGRATED because IKEA not only creating long term relationship with their suppliers, and
sharing a common goal and continues improvement with them, they also take cooperation into
the process level    

(it’s imperative that their supply chain operations and inventory management work together as
closely as possible)

( it is also rather difficult to maintain such network with your resources. Hence, IKEA has an
extensive network of suppliers and strives to maintain long term relationships by actively
working with them on improvements aimed to lower costs. This kind of commitment is full of
obstacles but the payoff is much higher. Working closely allows to build trust, which leads as
well to information sharing.)

(A key part of any good supply chain management or distribution strategy is a sustainable
relationship with one's suppliers. IKEA has a great working relationship with its suppliers. Their
greatest strength lies in the communication and relationship fostered through the years working
with their suppliers)
 
 
2- Explain the distribution strategy that IKEA follows, with evidence from the case?

 Direct shipment Distribution strategy  

(Where IKEA’s most innovative process comes from combining their retail and warehouse
processes. Almost every store has a warehouse on the premises)

(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. IKEA
does not have to do this as they all their products under one roof which is accessible to their
customers.)

Moreover, we can say that Ikea using time-based strategy and that strategy need to use direct
shipment to reduce the lead time 

(. IKEA goes about with a time-based strategy)

 
3- 
A. What are/is your suggestion(s) to improve the IKEA distribution strategy?
I think IKEA should stay in cross-docking strategy because it can serve the customer faster and
more sufficient with them in a whole, and that is what Ikea trying to do all the time,

B. How these/this suggestion(s) will improve IKEA distribution?

Honestly, I do not think a student university who does not know much about supply chain
system can suggest a way to improve IKEA distribution strategy, as the article identifies IKEA 
  
IKEA has been open for a staggering 70 years and is now one of the most recognizable brands in
the world. IKEA operates in almost 43 countries).

 Each IKEA store is huge and holds more than 9,500 products! How in the world does IKEA
offer so much at such a low price while always being able to keep items in stock? Logistics is the
integration of materials management and distribution (Rushto et al., 2010)

Ikea has been in this industry for 70 years how can I with 2 hours of studying can suggest a new
way to improve their distribution strategy 

Even if I mention any system or way that they can apply, applying system in real life is different
from talking about it or even it might not be applied in real life 
 
 
4- 
 
A. Explain how IKEA solves the problem of bullwhip effect with evidence from the case? 

They share information to accurate the forecasting and focusing on customer 

(Being able to correctly collect and prepare the right data for analysis is what gives a company a
fast start. IKEA has a proprietary system that shares the data collected from its POS)

(Another important function is their in-store logistics personnel which have the important job to
maintain store-level inventory reorder points and reorder products. This strategy also ensures that
IKEA has a ready inventory to meet customers’ demands, lowering the cost of lost sales.)

      B. What do you suggest to IKEA to do to better solve the problem of the bullwhip
effect?

Adjusting the refund policy, a refund within 3 days after buying only