Operations Management Challenges and Strategies in IKEA

REPORT ON
OPERATIONS
MANAGEMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
CONCLUSION..............................................................................................................................17
REFERENCES..............................................................................................................................18

INTRODUCTION
Operation management includes organizing, planning and supervising processes and
further making necessary improvement for gaining high profitability. It is multidisciplinary
functional area in the organization with marketing as well as finance.
Ikea is multinational furniture organization which was established by Ingvar kamprad in
Sweden. It was started in 1943. The report includes brief introduction to organization and
highlighting operation management challenges that is faced by company. Critically discussing
application of any three principles for maintaining quality management of operation management
practices. Evaluating impact of productivity, workflow and quality on the organizational
competitiveness. Evaluating integration of core operational strategies of company with its overall
business strategies. Report further carried forward with the discussion of role of management
information system in assisting strategic goals and operational processes success in organization.
The role of ICT application in supporting as well as enhancing operation management. Report
ends with analyzation of methodologies and scheduling tools which can be used for developing
project specification, controlling, scheduling and evaluation to effectively implement and
manage the project successfully. Concluding report with final findings and analyzing and
evaluating contribution of project leadership for effectively brining about change and manage all
stakeholder expectation.
MAIN BODY
Brief introduction to company and highlighting operation management challenges that are
faced by company. Critically discussing application of any three principle in maintaining
quality management of operation management practices
IKEA was founded in Sweden and it had its headquarter in Netherlands. It was
established in 1943 as mail-order sale business and the further begins to sell furniture in 1948.
IKEA is multinational group which manufacture, design and sell ready to use furniture, home
accessories and kitchen appliances (Heizer, Render and Munson, 2017). The company's name is
acronym for Ingvar Kampard, who is founder of company. It is currently operated its business
across 49 country and also have 145 stores globally. It mainly develops and manufacture
different type of furniture that are bed, sofas, bookshelves and tables along with bathroom
accessories and kitchen utensils. For effective functioning and management company consists of
various departments.

There are multiple operation management challenges that are faced by company. The
operation management is very important for IKEA as it is helpful for maximizing efficiency of
company while goods and service are being produced, so that the needs and demands of
consumer could be fulfilled. IKEA is company that manufacture furniture and thus some
operation management decision are involved in the company for purchasing fabric, wood, hiring
and training employees, planning for location and factory layout. So along with opportunities
many challenges are faced by company. The challenges which are faced by company are
sustainability, globalization, ethical conduct, system design and ineffective communication. The
company don't have effective communication among its employee and top management so that
problems which are faced by their employees couldn't be solved by company. Thus, employees
get demotivated. The company doesn't follow the sustainability in their companies business
operation so it can be indicated that they are harming country's natural resources. IKEA does not
have ethical business practice in their business. They lead to have a negative impact on the
company on its stakeholder and consumers as well. Designing system, managing system and
planning system represents wide range of challenges to the company, and they should effectively
manage and control it. The operation management of IKEA faces challenge while transporting
goods to the various countries. The trade barriers, technological advancement and transport
technology as well (Reid and Sanders, 2019).
There are major principles of operation management that can be used for focusing and
delivering the good and services to their customer's. The supporting IKEA for delivering good
result, by an optimized input of the material, equipment, human resource and technology. The
three operation management principles that can be further used by company are-
 Reality- The operation management of IKEA must focus on problem, instead of various
technique. As there is no tool which could present a universal and overall solution for
company' s problem. This principle can be used by IKEA that they could solve their
employees or any other operation issues by focusing on problem and then further
implementing solution and techniques on it so that it could be effectively solved. The
technique must be used according to the issue or problem so that manager can find
solution according to that. If IKEA follow this they can implement success in their
company and could gain their goals and objectives which are prescribed by them (Hitt,
Xu and Carnes, 2016).