IKEA SCM (1)

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upply Chain Management

The world's largest furniture retailer is a privately held, international home products company thatdesigns & sells ready to assemble furniture & home accessories

CASO DE EJEMPLO

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ummary

Culturethe I !" #ay$ission & %ision

istoryustainability & (esponsible care

The )roup organi*ation$ar+et analysisI !" at a )lanceCorporate objectivesMarketing strategy Order Qualifiers & WinnersCompetitive capabilitiesProcesses & InfrastructuresTerry ill Conclusions

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Culture The IKEAWayI !" offers a wide range of well-designed, functional homefurnishing products at prices so low that as many people as

possible will be able to afford them .This is the idea at the heart of everything I !" does.

"nybody can ma+e a good-/uality product for a high price, or a poor-/uality product for a low price.

0ut . to ma+e good products at low prices, you need to develop methods that are both cost-effective and innovative.

The I !" way of doing things is to pass these cost savings on to their customers .

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o create a better ever!da! life for man! people"

It means, thin+ing about home furnishing in a way that really doessolve some of life s daily challenges.

It means reaching out to as many people as possible and helping

them achieve their dream home at the lowest possible cost"

Vision & Mission

"s many people as possible will be able to afford a wide range of well

designed, functional home furnishing products at prices so low. Design # functionalit! # Low prices

El objetivo de IKEA es crearun mejor da a da para lamayora de las personas.Nuestra idea de negocio

apoya esta visin ofreciendo

una amplia gama de productos para la decoracindel hogar bien diseadosfuncionales y a precios tanbajos !ue la mayora de lagente pueda comprarlos.

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History

$%&'(s - I !" founder Ingvar amprad was born in weden.$%)'(s - I !" is founded.

$%*'(s - howroom in 3lmhult. 1st catalogue is published.

$%+'(s 4 1st store outside weden, in 5orway.

$%,'(s 4 (apid e6pansion - opens in wit*erland, )ermany Inter I !" 7inance ", is founded in 8u6embourg.

9The Testament of a 7urniture :ealer; by Ingvar amprad is published.

$%&'-s $%)'-s $%*'-s $%+'-s $%,'-s $%.'-s

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$%.'(s 4 I !" )roup is formed.

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%&e've come a long (ay but (e're still just (arming up.% teve oward Chief ustainability

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0nter 01EA 2olding SA is the parent company in Inter I !" )roup. The overall purpose of Inter I !" )roup is to secureindependence and longevity, and through the 7ranchise :ivision control, safeguard and develop the I !" Concept.

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Mar"et Analysis

Traditional furniture represents E B@F of the global mar+et.

0iggest producers in !uropeG )ermany H2BF , Italy H22F , 7rance H1 F & J H1@F .

(est of the worldG

Canada is the th largest e6porter of furniture in the world.$a?or furniture producing countries in outh !ast "sia areG=hilippines, Indonesia, $alaysia, ingapore, Thailand, orea ,Taiwan and India.

"sia shows healthy signs of growth.China has today emerged as a furniture production center.

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IKEA at a glan#e

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IKEA at a glan#e

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Corporate !b$e#ti%es

ustainable growth 4 target 0illion for 2@1 HK

=ositive impact on people & environmentH ustainability report

7ocus on customer

trong Corporate Culture

K !ducated guess

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01EA

Product

Prices

Place

Promotion

Mar"eting trategy01EA design means products that are atractive,

practical & easy to use

Pricing

trong relationship withsuppliers.

7lat furniture pac+ages

Cost savings passed totheir customers

)ood value for moneyL

Strong Communication

Catalogues & ecatalogue9I !" 7amily; card

)reen mar+eting

Segmentation

Coverage middle class consumer segments

Heducated singleA young family - :o it yourselfer

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uali'iers & Winners

Order 5ualifiers

=rice Image - :esign 7unctionalA7le6ibility Hcombine & mi6 components Innovation

Order 6inners

MualityA=rice - value for the money H @F =roduct (ange H @F Image - trong brand H2@F

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Competiti%eCapabilities

=rice 4 9low price is not appealing unless it represents good value for money;

7unctionalA7le6ibility 4 client can combine & mi6 components=roduct (ange

:istinctiveness in design

Image - trong brand

!conomies of scale 4 standardi*ation!conomic design!conomic 8ogistics!conomies of scopeG !verything together 4 food and woodLCustomers included in the value chain5etwor+ of suppliers N 12@@ in more than countries

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(ro#esses an) In'rastru#ture

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7orecasting

=roduct :esign

=roduction

:istributionCentresA tores

7inalCostumers

=redict the future in costumer needs


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(esearch & :evelopment

Technical pecifications

uppliers and manufacturers !ngagement

=rototype

(e/uirementsCheap and modular 8imited weight

"llow a flat pac+aging tac+able pallets

7orecasting

=roduct :esign

=roduction


7inalCostumers


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S6OP

S6OP7 wedwood #ay of =roduction, is O8eanO strategy and aphilosophy of continuous improvement that goes beyond productivityimprovements "

S6OP is the culture and it means that everything is continually evaluatedand improved in terms of time re/uired, resources used, resultant /ualityand other relevant aspects.

!very person in wedwood is involved and can contribute and should beinvolved in improving the company. Improvement is about everybody andeverything in the company, not only manufacturing.

7orecasting

=roduct :esign

=roduction


7inalCostumers


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I !" range consists of appro6imately P. @@ products

(aw $aterials

I !" buys from 12@@ suppliers Hhigh volumes in countries

factories worldwide Q other manufacturers

$ass =roduction process$a6.capacity utili*ationG7ocus on one production techni/ue7ocus on one cluster of products or product ranges

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7orecasting

=roduct :esign

=roduction


7inalCostumers

"nnual planning, depending on the estimated sales

Cheap and modular 8imited weight "llow a flat pac+aging Cost aving

tac+able pallets

2R :istribution centres

S )roup tores

$a+e to toc+


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7orecasting

=roduct :esign

=roduction


7inalCostumers

he 01EA E8perience

"lmost everything for home, under the same roof uge stores - around @.@@@ m2

7ew wor+ers

Catalogues

elf ervice 7urniture & transport

"ssembling by the costumer

8ocation 4 out of the cities centers

I+ea 7amily Card


Culture9:alues;h l d l f ) fl h f d i i ( bili

C l 9 l

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The values and culture of I+ea )roup reflect the founder s spirit - (esponsability,humbleness, simplicity and constant renewal.

CorporativeOb Order 5ualifiers Competitive Capabilities Processes 0nfrastructure

Sustainablegrowth

Positive impact onpeople >environment?Sustainabilit!report@

3ocus oncustomer

Strong CorporateCulture

Product Designand 0nnovation

6ell definedPricing Strateg!?Low prices@

Segmentation/ Middle classconsumer/ Do it !ourselfers

StrongCommunication? reen mar=eting@

O6Strong brand 0mage

5ualit!9Price /value for the mone!

Product 4ange

O5Price

3unctional9 3le8ibilit!/ client can

combine > mi8 components

0nnovation

0mage9Design

Price

Product 4ange

Distinctiveness in design

3unctional93le8ibilit! Bclient can combine > mi8components

0mage / Strong brand

3orecastingprocesses

Product 4>Dprocesses

Standard Massproduction?several locations@

Own andcontrolledoutsourcedproduction ?ma=eand bu!@

Advanced Suppl!Chain processes

Single saleschannel B retailstores

Advanced clericals!stem

? suppliers uotecollectors7reporting7 etc@

Protot!peDep9ment

esting Dep9ment

Large scaleproduction units

Large scaledistributionnetwor=?6arehouse@

Large scale retailstores

5ualit! controls!stems

Culture9:alues;The values and culture of I+ea )roup reflect the founder s spirit - (esponsability,humbleness, simplicity and constant renewal.

C l i

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- The success of the I !" )roup relies onG- The I#" 4 Innovation - :esign - 7unctionality-

!conomies of scale - $ass =roduction- upply Chain 4 =roduction 4 :istribution 4 (etail tores- Cost savings are passed on to their customers

- 8oo+ing forward...

- #e may /uestion if these order winners will remain the source of success-

ow will I !" react to mar+et changes & how fast will they adapt their order winners &/ualifiers

Con#lusion

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Than" you

see you* at one o' ourstores

IKEA SCM (1)

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