Strategic Management for Ikea
Executive Summary In this assignment, it mainly explains focus on the strategic management process. There are 3 main part of the assignment where each part describes on the different stages in the strategic management process. Strategic management is the art and science of analysing, formulating, and implementing decision that enable an organization moving towards to archive its organizational goals and objectives. Strategic management process consists of three major stages which is strategy analysis, strategy formulation and also strategy implementation. At the strategy analysis stage, a firm, in this assignment IKEA will identify and evaluate its external and internal environment. External environment can be further divided into general environment and also the competitive environment. The use of several tools such as PESTEL analysis, Porter’s five forces, Value chain analysis, SWOT analysis is essential to assist IKEA to identify the firm operating environment. At strategy formulation stage, IKEA focus on to attain and sustain a competitive advantage. There are three levels of strategy which IKEA have to be consider in this stage. At business level strategy, IKEA will formulate the strategies which help the firm to gain competitive advantages of either in cost leadership or product differentiation through its core competencies. The purpose of business level strategy is to maximize the profit in daily operation of the strategic business unit.
With the help of corporate level strategy, IKEA will select new strategies positions which contribute in increase the firm value. Resources are limited in an organization hence, it is essential for IKEA to allocate the resources efficiently to archive best practice. With the help of resources base approach and corporate parenting, the allocation of resources can be done effectively and efficiently. At this level, The Ansoff Growth matrix is a tool that cans helps IKEA to decide their product and market growth strategy
With the help of corporate level strategy, IKEA will select new strategies positions which contribute in increase the firm value. Resources are limited in an organization hence, it is essential for IKEA to allocate the resources efficiently to archive best practice. With the help of resources base approach and corporate parenting, the allocation of resources can be done effectively and efficiently. At this level, The Ansoff Growth matrix is a tool that cans helps IKEA to decide their product and market growth strategy
Links: Source : Goold, M. & Campbell, A., 2002, Do You Have A Well-Designed Organization? [pdf], Available at http://www.bvgintl.com/wp-content/uploads/2010/03/Do-You-Have-a-Well-Designed-Organization.pdf [Accessed 16th April 2011] Appendix 3.4 Other than that, strategic control systems need to be adapted to different business conditions. (Goold and Quinn ,1990) Their solution is a framework highlighting the conditions under which strategic control systems might be useful for an organization