A Report on IKEA's IT/IS Implementation for Business Development

This report examines the implementation of Information Technology (IT) and Information Systems (IS) within IKEA, focusing on its contribution to business development and change management. It begins by outlining IKEA's present condition, including issues related to product quality and marketing strategies, and the competitive forces driving the need for IT/IS changes. The report then explores the types of IT/IS and their roles within the firm, such as communication, data management, customer relationship management, and management information systems. Furthermore, it identifies and analyzes the challenges IKEA faces when implementing IT/IS, including economic, employee acceptance, time, and communication issues. The significance of IT/IS implementation is also discussed, highlighting its impact on communication, operations, and customer service. The report emphasizes the importance of IT in improving product quality, enhancing marketing efforts, and adapting to changing market conditions to maintain a competitive edge. Overall, the report provides a comprehensive overview of IKEA's IT/IS journey and its implications for the company's future.

Change Management Or
Risk management

Table of Contents
INTRODUCTION...........................................................................................................................1
Present condition and issues of selected company and competitive forces for changing their IT
and IS...........................................................................................................................................1
Types of information technology and information system and its role in firm...........................2
Challenges faced by company while implementing IS/IT...........................................................4
Significance of implementing IT/IS systems...............................................................................5
Conclusion.......................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Technology management is considered as one of the effective tool that allows
organization to manage their fundamental activities ell and gain competitive advantage. With the
growing competition in the corporate world each firm is trying to adopt advance technologies so
that efficiency level of operations can be improved (Doppelt, 2017). Current study is based on
IKEA which is engaged in manufacturing of home furnishing products. The vision of the firm is
to provide quality products at affordable rates. Present assignment will discuss contribution of
information technology in changing organizational performance. Furthermore, challenges faced
by firm in implementing these It tools in the workplace will be described in this study.
Present condition and issues of selected company and competitive forces for changing their IT
and IS
IKEA has been highly affected in recent times regarding issues related to quality in
products. Due to this there has been decline in sales of company and reduction in profits. Due to
this they have to change their furniture design whose quality is been affected. This has severely
damaged their credibility. Their reputation in the market has been damaged and customer
satisfaction has been reduced (O'Riordan 2014). IKEA is facing a lot of problems regarding it
marketing strategies in the market. They are not able to effectively attract large number of
customers to purchase their product. All these factors has turned down its brand reputation in the
industry. This has majorly affected its product quality. Moreover, what has added to them is
marketing through social media. This all has to be changed in order to again build strong brand
image and give competition in the market. A proper Information Technology system is needed to
improve product quality as well as implementing effective market strategies. By using these
systems it can help in creating new products by identifying customers needs and fulfilling them.
This will bring transformation in business operations within IKEA and will bring change in
employees working. A change in IKEA will allow employees to adopt work according to these
changes in order to fulfil goals and objectives. IT enables every organisation to create and
develop new products in order to survive and generate more profits. It also changes entire
functioning and operations of business making it easy for sharing data and information between
workers and managers (Stark 2015). Bringing in new technology is useful in making proper
tactical plans and developing marketing strategies so that new product awareness can be created
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among large number of audience. Therefore, change in IT system forces business to increase
competition and product demand (Heizer 2016.)
There are many external forces that drive changes in the business unit. External forces are
explained as below:
External forces
Increase demand
Customers are the life blood of business, if entity fails to meet with their demand then it
will not be able to retain then in the workplace for longer duration. If demand of particular
product is increasing then it becomes necessary for the IKEA to make changes in its IT tools and
adopt advance technical instrument so that it can meet with the consumer demand (Hayes,
2014).
High competition
In the modern business world, manufacturing industry is facing high competition. If
others competitors are taking support of advance technical devices for manufacturing high
quality furnitures. Then it becomes essential for IKEA as well that to adopt these technologies.
This can help in sustaining in the market for longer duration (External Forces That Influence
Organizational Change, 2017).
Types of information technology and information system and its role in firm
Change management is of different types as some time it is complex and hard but it play
significant role for an organisation in growth and development. In effective change management
all the steps should be identified and planned in respect to implement information technology
and system successfully. For the IKEA it is important to bring changes such as implementation
of information technology which help company in gaining competitive advantage. Further
information technology plays significant role within the firm and assist in increasing productivity
and profitability of the firm. Here below are some roles of information technology:
Communication: In the IKEA to send and receive messages email is one of the effective
method. It is basic mean of communication through which message can be send to supplier,
employees, customers etc. Since from last few years the number of communication tools have
also evolved and it make easier to communicate with the use of live chat system or view
conferencing system (Miyamoto, Henderson and Han, 2016). With the use of different
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communication technology, it become easy for the firm to directly communicate with its
customers and provide them quality products and services according to their requirement.
Data management: For the organisation it is important to kept record of all its customers and
employee’s information. Along with this there are different types of files and documents that
need to kept safe and secure for this purpose data management can be used by the firm. It made
easier for the firm to store and maintain a tremendous amount of historical data economically,
and employees benefit from immediate access to the documents which is required (Lin and
Atkin, 2014).
Customer relationship management: With the use of Information Technology, it become easy
for the IKEA to make improvement in the way of designing and managing customers
relationship. If company implement the CRM system then it can easily respond to the customer
query on time and solve their issues which help in retaining them for longer period of time
(Camagni, 2017.). All the communication and interaction done with customers can be stored in
the CRM system and it can be recalled if customer call again.
Management information system: To store the data can be only benefited if it is used
effectively and efficiently by the firm. IKEA can use this information and data as a part of their
strategic planning process and for execution of any tactical strategy. Furthermore, with the use of
information it become easy for the company to track profitability over time and increase return
on investment. Further manager uses it for tracking the sales on a daily basis (Hasan, Smith and
Finnegan, 2017).
Information technology and information system contribute to change in the organisation. It is
because in modern era there are many new technologies who are using advanced technology in
their IKEA so that they can gain competitive advantage and increase profit. Information
technology help in keeping the record of the firm and it made easier for them to make strong
relation with customers (Schwalbe, 2015). With the implementation of CRM system, it become
easy for the firm to keep records of its customers. Further it helps in gathering information
related to needs and wants of customers so that changes can be made in products and services.
Apart from this while contributing changes within the firm it is important that IKEA manage the
changes in an effective manner. As it is not easy to implement IT’IS as it consumes time and
sometime employees avoid using this technology due to lack of skills and knowledge. Therefore,
it is essential to provide training and development facilities to employees so that they use
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information technology effectively for increasing productivity and assist company in gaining
competitive advantage.
Challenges faced by company while implementing IS/IT
There are many issues faced by the organization, in order to deal with these problems
company have to make changes in their operational activities. IKEA is the multi national firm
which operates it business across the world. Company always adopt the latest technology as per
the requirement of market so that it can manufacture quality products and can meet with the
needs of consumers. But there are many issues faced by IKEA while implementing IT (Goetsch
and Davis, 2014). These are explained as below: Economic challenges: It is considered as one of the main issue that is faced by IKEA
while implement information technology tools in the workplace. Whenever new
technology come in the market then it becomes necessary for the cited firm to adopt it, so
that it can run its operations smoothly and can gain competitive advantage. But when
entity implement this IT software and tools then overall costing of the firm can get
increase. Installation cost, maintenance cost, training cost to employees etc. are
associated with implementation of new technology (Pugh, 2016). In such condition it
becomes difficult for the organization to run its operations smoothly. Non acceptance of employees: It is very difficult for the existing workers to work with
new IT tools. They have no knowledge about new technologies so they generally resist
this changes. In such condition issues related to conflicts etc. Get arise in the business
unit. It is the responsibility of management of IKEA that to handle such issues effectively
and try to resolve such type of challenges soon (External Forces That Influence
Organizational Change, 2017). Time challenge: It is the major issues which is faced by IKEA while implementing new
IT techniques. Company has to give time for installation of new technology, in such
condition existing operations get affected. It increases operational timing of the firm and
entity fails to met the demand of time. Chances of failure: Existing technology which are used by IKEA are much more capable
in manufacturing quality products as per the needs of consumers (Hayes, 2014). As
expectation of consumers are increasing then in such condition if entity implements new
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technologies then it may be possible then new tools fails to meet the requirement and
produce such high quality products. This may increase dissatisfaction among consumers
and it may affect overall sales volume of the organization. Communication issue: before implementing IT tools in the workplace, managers of
IKEA is required to coordinate with all staff members. They should provide proper
training to the employees and have to make them aware with uses and benefits of these
net technologies. If company fails to communicate well with staff members then it may
create complications in the business unit. By this way workers will not be able to
understand working process of these information technologies. Thus, they will not be
able to produce such material through these equipments (Goetsch and Davis, 2014).
 Changing market condition: Market is fluctuating, it can get changed any time. In such
condition IKEA has to conduct deep market research before implementing IT tools in the
workplace. In the absence of proper research cited firm would not be able to implement
these technologies properly in the organization. But on the same time if market condition
gets changed then it will have to conduct research again and previous activities will not
give any results to the firm.
Significance of implementing IT/IS systems
By implementing IT systems in business many changes occurs that helps IKEA for long
term. It improves operations of business and also employees performance. IT system process
data and provide useful information to employees (Schwalbe 2015).It also manages and
shows effective utilisation of resources to increase business productivity. There are various
ways in which IT system provides advantage to IKEA:-
 Communication- It gathers and collect information of customers allowing employees to
create and design product accordingly. It also helps in effective communication with
others departments relating to product development or improvement in product quality.
This helps in systematic working and collaboration.
 Operations- IT systems provides a complete information or data to employees and
managers. This helps them to work on this more effectively. It is useful in managing and
utilising resources top each department. It improves customers service by creating a
better quality product. For example- sales data gives an insight about what are customers
demand and accordingly product is designed.
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 Decisions- Better and effective decisions are taken regarding any business problem or
issues (Ierisman , 2015). It helps managers to choose proper strategy or plan from
various alternatives. It also leads to make decisions on product development and
production process. So overall efficiency of both managers and employees is increased as
they are able to make decisions based on available data. In IKEA it is very important for
company to decide which employee will design furniture
 Records- It helps in keeping records of different customers and their furniture designs.
Also, it is useful in finding solution of problem by using the past data. By comparing
data and information of customers it shows that how their taste and preference has
changed. Thus, according to it future analysis can be made and product can be designed.
It also shows reasons for increase in cost and forecasting demands of product. Along with
this analysis can be made on what actions have affected company performance (Galliers.
and Leidner 2014). Thus, IKEA will be able to develop strategies based on past
experience.
Thus, implementing IT systems in IKEA will help them to improve their product quality
and designing new products. It will also increase employees productivity as they will be able to
adopt change. Business operations will enhance due to change in strategies and goals of IKEA.
So overall they will be able to create more demand and attracting more customers. This will lead
to increase their sales and generating more revenues for long run. In this way they will be able to
survive in the market and increase competition. In this way they can gain more market share by
identifying customers needs and fulfilling them. (Cohen , Krishnamoorthy. and Wright 2017).
Conclusion
From the above report it is concluded that it is important for the firm to manage the
changes within the organisation so that it can survive in competitive market and increase profit.
In a competitive environment it is important for the firm to use Information technology and
information system so that producing can be increase and company can make innovative
products and services for its customers. Before implementing IT tools in the workplace,
managers of firm is required to coordinate with all staff members. Information technology help
company in making changes within the firm and keep information and data which help in
accomplishing success. Further, it is concluded that there are many issues faced by the
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organization, in order to deal with these problems company have to make changes in their
operational activities. Whenever new technology come in the market then it becomes necessary
for the cited firm to adopt it, so that it can run its operations smoothly and can gain competitive
advantage.
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REFERENCES
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dynamic theory of economic space. In Seminal Studies in Regional and Urban Economics(pp.
65-92). Springer, Cham.
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Erisman, J.W., 2015. Put people at the centre of global risk management: an individual focus is
needed to assess interconnected threats and build resilience worldwide, urge Jan Willem
Erisman and colleagues. Nature.519(7542). pp.151-154.
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Cohen, J., Krishnamoorthy, G. and Wright, A., 2017. Enterprise risk management and the
financial reporting process: The experiences of audit committee members, CFOs, and external
auditors. Contemporary Accounting Research.34(2). pp.1178-1209.
Galliers, R.D. and Leidner, D.E. eds., 2014. Strategic information management: challenges and
strategies in managing information systems. Routledge.
Heizer, J., 2016. Operations Management, 11/e. Pearson Education India.
O'Riordan, T. ed., 2014. Environmental science for environmental management. Routledge.
Stark, J., 2015. Product lifecycle management. In Product Lifecycle Management (Volume
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Online:
External Forces That Influence Organizational Change, 2017. [Online]. Available through
<https://bizfluent.com/info-8429147-external-forces-influence-organizational-change.html>
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