Business Strategy: Analysis of IKEA's Macro Environment, Internal Capabilities, and Competitive Forces

Business Strategy

Contents
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
Apply appropriate frameworks to analyse the macro environment for a given organisation......1
LO2..................................................................................................................................................4
Using appropriate frameworks analyse the internal environment and capabilities of a given
organisation..................................................................................................................................4
LO3..................................................................................................................................................6
Apply Porter’s five forces model and to evaluate the competitive forces of a given market
sector for an organization............................................................................................................6
LO4..................................................................................................................................................8
Apply a range of theories, concepts and models, interpret and devise strategic planning for a
given organisation........................................................................................................................8
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Business strategy is undertaken as the integration of decisions as well as actions which are
considered through entity in order to attain the business goals. Moreover, with assistance of
effective tactics, business could undertake competitive edge upon others. Along with this, for
rendering appropriate strategies is vital for evaluating both internal as well as external
atmosphere so that affects of several factors could be determined upon business (Aladag and et.
al., 2020). Likely strategies are developed through various business levels like functional,
business and corporate. for this report, the undertaken firm is IKEA, which is known to be one of
the growing retailer firm that deals in home appliances, furniture and others. Also, it have
headquarters is in Netherlands as well as operates into several countries such as United
Kingdom, Norway, Sweden, and others. The topics which going to be covered in this report is,
external and internal environment analysis with assistance of appropriate framework. Moreover,
the porter’s five forces model, porter’s generic model and Bowman clock model. Apart from the
strategic plan are also developed in this report.
LO1
Apply appropriate frameworks to analyse the macro environment for a given organisation.
Overview of organisation: IKEA is undertaken as the world’s renowned furniture selling
entity which have been trading privately. Moreover, the respective firm owner is Stitching Ingka
Foundation. Along with this, respective firm have been involved within retail outlets offering
furniture, financial assets management, customer satisfactory, shopping centres and many more,
the firm have been performing into various areas like North America, Europe and so on.
 VISION: The vision of IKEA is to develop an effective life for individuals in order to
offer them appropriate as well as comfortable furniture.
 MISSION: The mission of IKEA is to support their vision as well as provides board
variety of well developed, home furnishing at comparable lower cost so that individuals
may simply afford its offerings.
 Objectives: The key objective of IKEA is to enhance the various stores so that it may
enhance its market share by 15% as well as therefore the profit in a year.
PESTEL Analysis
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In order to effectually accomplish business goals, this is vital for IKEA for analysing the
affect of several external factors so that various factors influence may be minimised (Basari and
Shamsudin, 2020). Moreover, this might be performed with assistance of PESTEL analysis that
described below:
 Political Factors: The political stability as well as effective legal system have optimistic
affects upon IKEA as because of this there would not such changes that would undertakes
into norms. Moreover, alliance as well as associations with other countries would has
affirmative affects upon IKEA as it simply trade with them.
 Economical factors: The economical situation is feasible for IKEA as its opportunities
for FDI are simply available as well as government is anticipated for minimising the
corporate rate up to 18% that would have affirmative affects of firm. Additionally, the
customer per capita income is high that provide them opportunities for developing its
business.
 Social factors: Within United Kingdom, the living standards of individuals is effective as
well as because of that they are competent to spend huge amount upon products quality
as well as it provides opportunity for them to open up its new shops into country.
Additionally, with enhanced educational level, the consumer undertakes to buy branded
goods which are of standard quality that would be favourable for Respective companies.
 Technological factors: Within United Kingdom, individuals consider to have
technological advanced goods that allow them to have much potential. Because of this,
the management of IKEA have opportunity for providing its effective products that are
formulated with effective process of technological process.
 Environmental factor: The government have undertaken several steps as well as laid
various implications upon administrative of wastage so that ecological protection may be
assured. With this, firm could assure effective image into its consumer minds.
 Legal factors: IKEA have to comply with equality as well as employment act into
workplace but it would also has affirmative affects upon them as this assure satisfied and
efficient personnel which could contributes with its effectiveness.
Based upon the above PESTEL analysis, this has been determined that entity has vita
benefits upon whole external environmental factors as well as because of this they may simply
explore its marketplace into United Kingdom (Chernyakhovskaya and Berezka, 2020).
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