Case Study: IKEA Entering Russia

Assignment 4: IKEA Entering Russia

When IKEA entered the Russian market in 1998, Ingvar Kamprad had a vision and a long-term plan for what he wanted IKEA to achieve. Even though the country was in a bad financial situation at the time, he believed that IKEA would become the main supplier of home furniture to the average Russian families, and that sales volumes would exceed those in Sweden. Kamprad took the opportunity to communicate his vision during a visit in Russia which, I believe, is an example of him being a charismatic leader. He had set a strong vision for IKEA as a company as well - "to create a better life for the many people" (Browaeys & Price, 2015, p. 226). Kamprad 's leadership can also be described as value-based, where values

When IKEA establish themselves in Moscow, Russia, the company followed their strategy and recreate their corporate culture at the new location. The culture was implemented by experienced IKEA employees who trained the new co-workers and taught them about the company 's values, traditions, routines, management style, human resource polices, customer relationship philosophy with the "flat-package concept", etc. In addition, IKEA employees did home visits in the local community. Driven by the vision to create a better life for the many people," IKEA wanted to learn more about the local living conditions. The company wanted to create needs, not yet identified by the locals, that IKEA could present solutions to, that would ease the customers everyday-life. For example, IKEA learned that many Russian families live in small apartments and therefore IKEA marketed how their storage solutions could solve some of these problems. This shows that IKEA is not only innovative, but also a learning organization, in the way it operates to keep its competitive advantage. They strive to continuously learn about the new markets and incorporate it in their strategy. With their vision and values as guiding tools, providing direction, they are also actively shaping the "landscape" they are working in (Browaeys & Price, 2015, p. 223). In my opinion IKEA has a transnational/global strategy. IKEA 's strategy is to offer the same product range in most countries. However, they are also offering some products that are adjusted to the needs in a specific region, such as preferences for type of wood, and a few products are produced only for that specific market. I believe that the balance that IKEA has found when it comes to global standardization has contributed to their success (Browaeys & Price, 2015, p. 204, 230,