International Business Assignment Example | Topics and Well Written Essays - 500 words - 2

International Business - Assignment Example The strategy that keeps IKEA to its position is through refreshing and renewing their service model. IKEA has a unique approach to deal with its customers as it employs a self-serving method. Customers make choices on the product, picks them from the shelves and assembles them at their at home on their own. Self-service is a rare approach in the furniture businesses, but the customers choose to apply the approach due the low prices offered. IKEA is a corporation often described as the prototypical Teflon multinational. Some describes the company as quintessential global cult brand which has a democratic culture. For instance, at a company dinner employees take dinner first, followed by the managers, directors and lastly Ingvar Kamprad. Kamprad emphasized on a matrix form of organization which is an informal, nonhierarchical and team-based organization. This kind of an organization has an open flow of information and knowledge within all stages of management. The current organizational structure can be described as highly functional, with an international market strategy. Therefore, IKEA maintains a centralized control over functional activities as well as taking advantage of low cost and good quality furniture from the international suppliers. In addition, control over strategic direction has been developed, and functional layoffs are minimized. To ensure the effectiveness of the logistics process, IKEA has integrated distribution and purchasing process under one umbrella function. The significance of centralized strategic direction will rise as IKEA continue to expand overseas (Capell, 2005). IKEA has found its strength in providing highly functional and quality products at a low price. Moreover, the company has been able to establish a market brand name and a goodwill that is essentially instrumental to the performance of the organization. On top of that, the company has an efficient value