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Leadership, Management, and Operations Management: A Case Study of IKEA

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Added on 2024/06/28

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This assignment explores the distinct roles and responsibilities of leaders and managers within an organizational context. It delves into various leadership theories, including situational leadership and contingency leadership, to understand how different leadership styles are employed to address specific situations. The assignment further examines the significance of operations management in achieving business objectives, using IKEA as a case study. It analyzes how IKEA effectively applies operations management principles across various areas, including supply chain management, inventory, distribution, layout design, floor operations, and quality management. The assignment also discusses external factors, such as corporate social responsibility (CSR), that influence operational management and decision-making processes.

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Table of Tables
Table 1: Differences between leaders and managers....................................................................4
Table of Figures
Figure 1: Situational leadership styles...........................................................................................9
Figure 2: Fiedler’s Contingency model.........................................................................................11
Figure 3: IKEA Store..................................................................................................................... 18
1

INTRODUCTION
Leaders and managers work to achieve the common goal of improving the profitability of the
company and ensure the long-term sustainability of the organisation. The current assignment
explains the basic difference between the roles and responsibilities of leaders and managers.
This difference is further explained with the help of different theories and concepts such
assystem leadership theory which explains different roles that managers have to play to
successfully manage the different function of an organisation. Further, the assignment will
discuss the contingency and situational style of leadership. The situational style of leadership
asserts that leaders must adopt different types of leadership based on different situations. The
second part of the assignment deals with the value and importance of operations management
in reducing the amount of waste in the companies and the role of leaders and managers to
apply different function of operations management to increase the profitability of the
company.
2

TASK 1
P1 DEFINE AND COMPARE THE DIFFERENT ROLES AND CHARACTERISTICS OF
LEADERS AND MANAGERS
Admiral Group is a financial service providing firm headquartered at Cardiff. The company was
started in 1993 as a small company and with strong leadership and customer oriented services
the company today has 5 million customers worldwide and works with employee strength of
6,169. The company has developed at a fast pace due to its strong organisational culture and
management training programmes. The current report will discuss the role of leaders and
managers in managing different functions of Admiral Group successfully.
DEFINITION OF A LEADER
A leader makes a long-term vision for the company and motivates the employees to achieve
that vision. He inspires his subordinates to improve their skills and achieve their personal,
professional and organizational goals.The leader has a clear idea about the current situation of
the company and where it has to go in the upcoming years. He analyses the current competitive
landscape around the company and takes the challenge to do out of the box things (Watkins,
2012). Not only he makes a long-term strategy but alsoinspires his subordinate to understand
the bigger picture and work as a team to achieve the desired goal.
DEFINITION OF A MANAGER
The managers, on the other hand, have the responsibility to execute the vision of the
organization by dividing the big task into a number of small achievable tasks and make a well-
defined roadmap to achieve different milestones in a specific time interval. Managers direct the
day-to-day activities in an organization and decide the work responsibilities of different team
members. They define differentoperating procedures and make sure that employees are
working in an organized way to achieve the organizational objectives.
3

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Table 1: Differences between leaders and managers
Roles and
Characteristics
LEADER MANAGER
Traits Leaders paint a big picture of the
organisation and are ready to take some
risks to make that picture a reality.
Managers focus on achieving goals.
They focus on doing the things in the
right way by the help of accurate
planning (Diefenbach, 2013).
Roles and
responsibilities
The primary responsibility of a leader is to
establish a clearvision for the company and
eliminate uncertainties in the employees
regarding the feasibility of this vision.
The role of a manager is to organise and
controls the activities of the people in
an organisation to achieve a goal.
Authority and
power
The leaders have the authority to take all
the decisions which are required to take the
organisation forward.
The managers have the authority to
decide on the roles and responsibilities
of each employee and direct the
employee to complete all the tasks at
the designated time.
Vision The vision of the leader is to build an
environment of loyalty and trust so that
employees can improve their products
which will ultimately improve the
productivity of the company(Pound, et al.
2014).
The vision of the manager is to create a
well-defined roadmap which will help in
simplifying the process of goal
achieving.
4

P2 EXAMINE EXAMPLES OF HOW THE ROLE OF A LEADER AND THE FUNCTION
OF A MANAGER APPLY IN DIFFERENT SITUATIONAL CONTEXTS IN THE
ORGANIZATION
FAYOL'S FIVE FUNCTIONS OF A MANAGER
Henry Fayol was a French engineer and the director of a big mining company. Based on his
experiences in managing an organisation, he explained five primary functions of amanager in an
organisation.
Planning
Planning is the process to look into the future and analyse the present situation of the company
as well as resources available so that a well-planned pathway can be prepared to move
forward. Managers must be able to plan any possible contingencies in the process and shape
the future course of action for the company.
Organising
This the process of managing the required capital, human resource and raw material so that
day to day functions can run smoothly, it also involvesdeciding theresponsibility of each
member and align their activities with the objectives of the company (Hunt, et al.2013).
Managers should also make sure that the workforce is adequately skilled and if there are some
gaps in the knowledge and skills of the employeeshe should also organise some training and
education programs.
Commanding
Commanding is the process of communicating the objectives of the company and managing the
roles and responsibilities of different team members. It also involves monitoring the daily
activities of the employees and asses the work performance and provide feedback so that
employees can improve their skills and knowledge.
5

Controlling
Controlling means making sure that the work is progressing according to the plan and take
corrective actions if required. The performances of the employees need to be compared with
the set performance standards of the company. Controlling also ensures that the activities
being carried out are producing desired results (Pedler, et al. 2013).
Coordinating
It involves motivating the employees towork as a team; this also involves sharing the
knowledge and skills with each other. A good coordination between the employees creates a
positive work environment which increases the efficiency of the employee. By coordinating
with other team members the employees can simplify complex tasks.
Rolls Royce Plc. is one of the largestdefence equipment manufacturing companies in the world
and supplies high-quality power systems, aircraft engines and nuclear energy systems. A new
advancement in the science and engineering practices requires constant research and
development and the leaders and managers need to plan and coordinate different functions of
the company so that these technologies can be incorporated in the products. The managers
need to plan up-gradation process in the production units so that processes can run smoothly
(Poksinska, et al. 2013). Customers of Rolls Royce include the armed forces of more than 100
countries and their primary requirement that the engines must be able to use clean sources of
energy. To satisfy this demand, the managers have to manage the research and development
activities so that some innovative solutions can be found. After developing the technology in
the lab, it needs to be used in the commercial products, which also need coordination between
different departments.
6

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P3 APPLY DIFFERENT THEORIES AND MODELS OF APPROACH, INCLUDING
SITUATIONAL LEADERSHIP, SYSTEMS LEADERSHIP AND CONTINGENCY
SITUATIONAL LEADERSHIP
The situational theory of leadership proposes that in an organization a single style of leadership
may not be able to produce the desired results and to lead ateam effectively a leader should
choose a leadership style according to the different situation. This theory explains four broad
styles of leadership which are explained below:
1. Directing
This type of leadership is suitable when the skill level of the employees is very low. In
such situations, a leader needs to design simple tasks which can be done easily by entry-
level workers and he continuously directs them so that they can stay motivated for the
work. This style of leadership is also applicable when new technology is being
implemented in the company and the employees do not have prior experience in
handling the job.
2. Coaching
This is also called selling style of leadership because there is an open dialogue between
the leader and the employees the leader proposes an idea in the best possible way and
expects the employees to understand his vision. At this stage, the employees have
adequate skills but they do not have the confidence to complete the task without any
guidance (Sadri, 2012).
3. Supporting
The supporting style of leadership the leader provides much authority to the
subordinates and they are free to take decisions regarding the way the things need to
be done in order to finish a task. The direction from the leader is limited he is always
ready to provide guidance and support.
4. Delegating
7

This style of leadership is adopted when the employees are highly skilled and are
capable to complete their tasks independently without any guidance. The role of the
leader is to monitor the process and he follows a hands-off approach.
Figure 1: Situational leadership styles
[Source: Todorov, 2018]
The strength of the situational theories is that it proposes that the members of a team are not
alike they react differently in different situations. Jack Stahl who was the president of Cocoa-
cola from the year 1978 till 2000 is a perfect example of situational leadership and always
believed in delegating the responsibilities to the competent employees (Bolden, 2016). He said
in an interview that leadership is not a popularity contest, once a leader realizes that the
employees are doing things on their own he must pull back and focus his attention in some
long-term goals which will take the organization forward.A typical situational leader will act in
the following way:
Diagnose
8

The ability to diagnose means understanding the situation which is in front of you and pick the
style which suits best according to the circumstances. The leaders also need to assess the
readiness levelof the subordinate and then follow the appropriate style of leadership.A leader
may also need to analyse the competitive position of the company to diagnose a problem.
Adapt
It is the ability of a leader to adjust his behaviour according to the changing situations. He must
be able to understand different personality behaviours and perspective which simplifies the
process to adapt. An adaptable behaviour of the leader helps him keeping him calm in the time
of difficult situations.
Communicate
Being able to communicate is the most basic skill required for a leader. He must interact with
the teammates and make them understand the long-term objectives of the company.
Maintaining abetter eye contact and being ready to listen to others makes the communication
more effective. Ability to learn new things improves the communication of the leader.
Advance
After choosing a particular style of leadership the leader needs to quickly advance and manage
different functions effectively. This ability also becomes important in the situational leadership
because this style of leadership needs constant readjusting the approach according to the
situation.
9

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FIEDLER'S CONTINGENCY THEORY
Figure 2: Fiedler’s Contingency model
[Source:Matthews, 2018]
Fred Fiedler explained this model of leadership which is based on theContingency theory of
leadership. This model explains that the personality traits of a leader are strongly influenced by
the family upbringing, society, culture and education. All these factors build a personality of an
individual and his relationships with the colleagues and subordinates. A leader should
understand his true behaviour and whether he is task oriented or personal relationship
oriented (Poksinska, et al. 2013). The contingency theory given by Fiedler is quite opposite to
the situational theory which emphasises on moulding the behaviour of a leader according to
the situation whereas contingency theory assumes that it is not possible to alter the
fundamental behaviour of an individual leader and the effectiveness of a leader can be ensured
only if his leadership style matches the situation.
Fred Fiedler devised a scale to assess the basic nature or leadership style of a leader and he
named this scale as LPC scale which is abbreviated as least preferred co-worker scale. Itincludes
asking some questions regarding the least preferred colleague or the subordinate with which
10

the leader is working or has worked in past. He has to score the least preferred co-worker on
the basis of some positive factors such as friendly, cheerful, helpful or some negative factors
such as unfriendly, gloomy. The response of the leader provides a high or low LPC score which
decides the personality type of the leader that whether he is a task-oriented leader or he is a
relationship-oriented leader (Diefenbach, 2013).
11

TASK 2
P4 EXPLAIN THE KEY APPROACHES TO OPERATIONS MANAGEMENT AND THE
ROLE THAT LEADERS AND MANAGERS PLAY
Operations management is the activity of managing the product and services of an
organisation. It is responsible to deliver the products and services according to the
requirements of the customers. In the present report, a discussion will be made on my role as a
manager in the operations management function of IKEA which is the largest furniture retailer
in the world (Azadegan, et al. 2018). The operations management process of IKEA is unique
because it is able to deliverperfect value to the customer at affordable prices.
DIFFERENT MODELS OF MANAGING OPERATIONS
Just-In-Time (JIT)
JIT is an inventory management strategy which was first applied exhaustively by Toyota motors.
This strategy focuses on possessing very little inventory, which has a number of benefits. First, it
clears up all the occupied space in the inventory which facilitates the movement of goods and
people. Second, it releases the blocked capital in the form of inventory items. For effective
implementation of JIT strategy, it is necessary that the warehouses must be located very near
to the production facilities so that expenses in the transportation can be reduced. As amanager
at an IKEA retail store, I can use JIT to free up more space at use it as shop floor.
Total Quality Management (TQM)
TQM is a management approach which emphasises on the continuous improvement in the
quality of products and services. The basicprinciple of TQM is to do the things in the correct
way right in the first attempt and then continue this quality again and again (Brown and Bessan,
2013). The TQM approach can be highly effective for an organisation when it is based on the
requirements of the customers. Improvement in the quality improves the competitive position
12

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of the company and attractsnew customers. TQM results in higher productivity and increased
customer satisfaction.
KAIZEN
Kaizen is the commitment of an organisation for continuous improvement. The basic guiding
principle of Kaizen is that big results are often obtained by doing small operational changes
which can be identified by grasping the current situation of the company. As soon as a problem
is identified steps should be taken to correct the root cause of the problem (Heizer, 2013).
Kaizen is aJapanese term and it is made of two words. Kai which means change and Zen that
means good, it meansthat if there are some faults in the process even if it is small, it should be
rectifiedimmediately which results in smooth operations of the function in a factory for a long
time.
Six-Sigma
Six-Sigma is the process in which the quality of the products and services are improved with an
aim to eliminate all possible defects. Implement Six-Sigma in various functions of retail such as
merchandising, marketing and supply chain management can impact the cost management of
IKEA an it also helpful in improving the customer services. Managing the layout of the IKEA
stores in an effective way will provide a space in the store which will facilitate the movement of
customers and furniture items from place to another.
Lean Management
Lean management focuses on reducing the amount of waste in the production by optimising
the basic activities in the operations. This theory defines seven types of wastes which need to
be minimised in order to improve efficiency and reduce the amount of waste. In a retail store,
the waste can be in the form of unnecessary movement of employees (Brown, et al. 2013). The
items in the retail stores must be organised according to the popularity of the products so that
people do not move unnecessarily in the aisles. The warehouse should also be located at a
minimum distance from the stores so that waste in the form of transportation can be reduced.
13

MY ROLE AS AN OPERATIONS MANAGER AT IKEA
The basic functions of an operations manager at IKEA are to direct the daily operations at the
store to maximise sales and minimise costs. IKEA has 276 stores in different countries of the
world and has developed a special way to sell furniture. Sometimes the customers stay in the
store for more than two hours. To follow the principles of operations management, IKEA has
started to sell its furniture as self-assembly flat packs. This arrangement saves the floor space at
the stores and also reduces the transportation cost. My role as an operations manager at IKEA
is to ensure the smooth flow of the customers in the store and parking area. I also need to
manage a play area at the store which keeps the children engaged and the parents can enjoy
their shopping experience. The store also has in-store shortcuts which guide the customer to
the desired area without having to pass through all the preceding areas. Extra helping staff is
also available for customers at key points. Operations management at IKEA also includes
arranging the supply chain operations so that products can be delivered in the store at right
time.
14

P5 EXPLAIN THE IMPORTANCE AND VALUE OF OPERATIONS MANAGEMENT IN
ACHIEVING BUSINESS OBJECTIVES
The basic principle of operations management is to do the job perfectly right for the first time.
It also includes minimising the expenses of the company by making small changes in the
operations and distribution so that the cost of the company can be effectively reduced. The role
of operations manager in applying the operations management in the different area is
explained below:
Design of goods and services
The design of goods and services of IKEA is such that it provides maximum value to the
customers at minimum cost. The company seeks to use a minimum material for making the
furniture which effectively reduces the cost of transportation and also helps in reducing the
prices of finished products. As a manager, I regularly take feedback from the customers so that
the demand of the customers regarding the design of the furniture and the customer services
can be assessed (Jacobs, et al. 2014).
Quality management
The designsof the furniture of IKEA are very popular with the customers because these designs
are the perfect blend of quality, style and affordability. This has become possible through the
use of high-quality wood, minimalist shape and use of new innovative materials for making
furniture. IKEA always seeks for new materials which can be used for making furniture which is
light in weight and environmentally sustainable. As an operations manager at IKEA store, my
responsibility is to ensure that the furniture is safe while moving from inventory to the store
and the quality of the article is maintained.
Layout design
15

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The racks and shelves at the store are at such heights where a normal person can reach.
Additional products are stored in racks. The responsibility of the manager is to manage the
aisles of the store properly so that there is adequate space for movement of the people. I also
make sure that the shelves are properly managed so that customers can easily find the required
item.
Supply chain management
At a time an IKEA store holds around 10,000 different products. IKEA is able to maintain such a
large stock of item due to its strong supply chain management which ensures that the distinct
value of its products and services is maintained (Packowski, 2013). IKEA has a policy that the
prices which are mentioned in the catalogue will not be changed for a year.The managers at
IKEA record deliveries and check the delivery notices carefully to get all the goods to the
designated area.
Inventory management
The furniture of the company is divided into many pieces which can be assembled by the
customers at home. These pieces are kept in flat packages which capture minimum space at the
inventory.IKEA has more than 1800 suppliers in different countries of the world and maintains a
good relationship with these suppliers to get the products at minimum prices. The operations
manager checks the quality of material and negotiates for better prices (Rouse, 2018).
Process design
The inventory of IKEA is always stocked at night. The next day orders will depend on the
number of items sold from the racks. This process helps the company in maintaining adequate
inventory, and it also helps in delivering the products to the customers in minimum time. The
responsibility of operations manager is to monitor and record deliveries, sort different goods in
a separate area and ensure efficient flow of goods
16

Figure 3:IKEA Store
[Source: Merkezimiz, 2018]
17

P6 ASSESS THE DIFFERENT FACTORS WITHIN THE ORGANIZATION’S
ENVIRONMENT THAT MAY IMPACT UPON OPERATIONAL MANAGEMENT AND
DECISION-MAKING BY LEADERS AND MANAGERS
CORPORATE SOCIAL RESPONSIBILITY (CSR)
CSR aims at mitigating the adverse impact of industrial activities on the environment and the
local communities involved with the business. It also includes the activities of the third-party
vendors associated with the company, for example, renowned apparel company GAP was
widely criticised when it was discovered that one of its cloth supplier in India was employing
minors its workshop (Schroeder, et al. 2012). It means the responsibility of a big organisation is
not only limited to its immediate surrounding but also to the different stakeholders associated
with the business and helping the company to grow.
ORGANISATIONAL CULTURE
The organisational culture is formed the regional identities of the employees and the
management systems of the organisation. The organisational culture is also influenced by the
behaviour of the customers. Operations management often requires amendments in the
processes of the company and the organisationalculture in some companies makes it a difficult
process.
VALUES AND ETHICS
The values and ethics of the company are the basic ideologies which are thebasis of the
formation of the company. These are the standard code of conduct which is followed by an
organisation and the management expects the employees to follow these minimum standards
while interacting with the customers or with other employees (Schwartz, 2017). An ethical
environment makes the employees positive and results in better efficiency.
18

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IMPACT ON DECISION MAKING
As an operations manager at an IKEA store, I understand that factors like CSR and
organisational culture make an impact on the operations of the store. The unavailability of raw
materials like wood, boards and cloth can make an impact on the long-term survival of the
company as well as on the immediate operations of the company. The organisational culture
also makes an impact on the decision making. Managers must ensure that the behaviour of the
employees is aligned with the organisational culture (Slack, et al. 2013). When recruiting the
employees,the management must make sure that the employee to be recruited must have such
values and ethics which will help him to fit into the organisation easily.
19

CONCLUSION
This assignment is prepared with an aim to assess the role of leaders and manager in carrying
different functions in an organisation. In the initial part of the assignment, the basic roles and
responsibilities of leaders and managers are discussed. Later, the assignment discussed
different leadership models such as situational leadership and contingency leadership model.
These models explain different leadership styles which are adopted by the leaders in order to
deal with a particular situation. The assignment also discussed the importance of operations
management in the organisation. Different area in which operations management principles are
being applied in IKEA is also discussed. The operations management principles are helpful in
managing supply chain management, inventory, distribution system, layout design, floor
operations, and quality management at IKEA stores. The assignment also discussed the external
factors such as CSR which make an impact on the operations management.
20

REFERENCES
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environmental complexity and environmental dynamism on lean practices. Journal of
Operations Management, 31(4), pp.193-212.
2. Bolden, R., 2016. Leadership, management and organisational development. In Gower
handbook of leadership and management development (pp. 143-158).
3. Brown, S. and Bessant, J., 2013. Strategic operations management. Routledge.
4. Brown, S., Blackmon, K., Cousins, P. and Maylor, H., 2013. Operations management:
policy, practice and performance improvement. Routledge.
5. Diefenbach, T., 2013. Why many managers and change leaders get it wrong.
Organizational Change, Leadership and Ethics: Leading Organizations towards
Sustainability, p.149.
6. Heizer, J., 2013. Principles of Operations Management: Student Value Edition. Prentice
Hall.
7. Hunt, J.G., Hosking, D.M. and Schriesheim, C.A. eds., 2013. Leaders and managers:
International perspectives on managerial behavior and leadership. Elsevier.
8. Jacobs, F.R., Chase, R.B. and Lummus, R.R., 2014. Operations and supply chain
management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.
9. Matthews, J., 2018, Leadership Theories: Three Types of Contingency and Situational
Theories, Online available at: https://toughnickel.com/business/Leadership-Theories-
Three-Types-of-Contingency-and-Situational-Theories[last accessed on 16th July 2018]
10. Merkezimiz, C., 2018. Online availabale at:
https://cagrimerkezimiz.com/ikea-cagri-merkezi-iletisim-telefon-numarasi/ [last
accessed on 15 July 2018]
11. Packowski, J., 2013. LEAN Supply Chain Planning: The New Supply Chain Management
Paradigm for Process Industries to Master Today's VUCA World. CRC Press.
12. Pedler, M., Burgoyne, J. and Boydell, T., 2013. A Manager's Guide to Self-development.
McGraw-Hill Education (UK).
21

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13. Poksinska, B., Swartling, D. and Drotz, E., 2013. The daily work of Lean leaders–lessons
from manufacturing and healthcare. Total Quality Management & Business Excellence,
24(7-8), pp.886-898.
14. Pound, E.S., Bell, J.H. and Spearman, M.L., 2014. Factory Physics for Managers: How
Leaders Improve Performance in a Post-lean Six Sigma World. McGraw-Hill.
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https://searcherp.techtarget.com/definition/inventory-management (Last accessed on
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16. Sadri, G., 2012. Emotional intelligence and leadership development. Public Personnel
Management, 41(3), pp.535-548.
17. Schroeder, R., Rungtusanatham, M.J. and Goldstein, S., 2012. Operations management
in the supply chain. McGraw-Hill Higher Education.
18. Schwartz, M.S., 2017. Corporate social responsibility. Routledge.
19. Slack, N., Brandon-Jones, A. and Johnston, R., 2013. Operations management. Pearson.
20. Stevenson, W.J., 2012. Operations management: Theory and practice.
McGraw-Hill/Irwin.
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perspective and responsibility. Harvard business review, 90(6), pp.64-72.
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Leadership, Management, and Operations Management: A Case Study of IKEA

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