OPERATIONS MANAGEMENT

IKEA's Operations Management

IKEA

Introduction

The following discussion will begin by presenting a succinct description of IKEA, followed by a more detailed explanation of what IKEA does, and how these operational activities relate with the theoretical concepts covered in the lecture series. This will be followed by a critical examination of issues and challenges confronted by IKEA as well as a highlighting of the role engineers play in meeting the operational requirements of IKEA (Baraldi and Waluszewski 2005). The Operations function is arguably the most integral part of any business. Virtually all organisations create and deliver some form of products and/or services to their customers and end-users. In this regard, this discussion will essentially attempt to present a critical reflection on what your IKEA does, and how engineers fit into their broader operations context.

IKEA's engineers play a major role in the development of IKEA at a broad level. For instance, an example of the multilateral role of IKEA's engineers can be found in the fact that IKEA's engineers provide assistance to IKEA's suppliers about the technical characteristics they can incorporate in their products to increase the utility of their products. In this regard, IKEA's engineers play a pivotal role in IKEA's products' research and development. IKEA translates its philosophy of providing cost effective furniture to consumers by allowing its engineers to bring intangible values into tangible product characteristics.

Description of IKEA

IKEA is a multinational company that provides consumers with domestic furniture and functional products for residential usage. The company has managed to garner significant popularity in the last few years on account of the maverick approach that it has adopted towards business conduction and operations management. The business has managed to make use of a business conduction approach in whic it has made it possible for consumers to purchase reasonably priced products for domestic usage (Yunker 2007). IKEA was formed in 1940s and is currently a subsidiary of the INGKA foundation from the Netherlands. The front end structure of the company is that which relates to the regular retail business. IKEA's product line comprises products from two sources. The first source is through third parties: IKEA purchases products from third parties and retails them under its umbrella.

These products are generally those that are designer products or those that are designed for specialized purposes. The second source is IKEA's industrial group: Swedwood. A majority of IKEA's products are produced by this group. IKEA's organizational structure falls under the direct control of the INGKA holdings group, which is then further divided into two categories: group support functions and expert functions (Yunker 2007). These are also referred to as inter IKEA systems. The five areas of functioning that fall under these two categories are range, industry, purchasing, distribution & wholesale and retail.

Detailed explanation of the organization's functions

The corporate structure is divided into two main parts: operations and franchising. Most of IKEA's operations, including the management of the majority of its stores, the design and manufacture of its furniture, and purchasing and supply functions are overseen by ...