Abstract

The case discusses in length about Sweden based IKEA's globalization strategies and its foray in the Chinese furniture market. The basic assumption behind IKEA's global strategy was 'one-design-suits-all,' which meant that the company did not adapt to the local markets. The case presents how IKEA was forced to change some of the elements of its global strategy in the culturally diverse Chinese market. It highlights the importance of striking a balance between the implementation of global polices and the need for higher degree of localization for IKEA to be successful in markets like China. The interrelationship between IKEA's culture, structure and strategy and its responsiveness to the needs of local markets are also highlighted.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Role of social, economic, political and cultural factors that prevail in China in shaping IKEA’s strategy in China
• Need for IKEA to strike a balance between globalization (integration) and national responsiveness (differentiation) in China.

Keywords

IKEA, Globalization, Standardization, Localization, IKEA Way, Do-it-yourself (DIY) Principle, Corporate Structure, Corporate Identity, Business Environment in China, Chinese Furniture Market, Business Model, Low-Price Strategy, Corporate Culture, National Responsiveness