Human Resource Management a IKEA *

Abstract:

IKEA was one of the largest furniture manufacturers and retailers in the world, with operations in 32 countries (in early 2005). The company was well known for its stylish and innovative designs. It was the pioneer of furniture that could be dismantled and packed flat, to allow ease of transportation.

IKEA's main strength was its committed workforce, which was often the source of the company's innovative concepts. IKEA adopted a positive approach toward human resource management. In the late 1990s and early 2000s, the company implemented several initiatives that promoted ‘life balance'and diversity. The case discusses the innovative human resource management practices adopted by IKEA and describes its work culture. Initiatives related to flexible work design, comprehensive benefits, quality of work life, and employee training and development are outlined. The case also discusses the prominent elements of IKEA's culture, such as diversity, openness, equality, cost consciousness, and competitiveness.

Issues: » To understand the human resource management practices and work culture of a major furniture manufacturer and retailer. » To appreciate the importance of positive human resource management practices in employee retention. » To understand the need for employee development and to study the practices adopted by a major multinational company toward this end. » To analyze the effect of culture on employee morale and the relationship between culture and innovation.

Questions for Discussion:

1. IKEA was well known for its positive human resource management practices. Critically examine the important elements of IKEA's human resource management policy and their effect on employee morale.
2. Employee development is one of the most important aspects of human resource management. Examine IKEA's employee development programs and comment on the advantages of these programs to the employees as well as the employer.
3. Culture plays an important role in fostering innovation. What, according to you, are the important cultural elements that promote innovation? What are the reasons for IKEA's innovativeness?

Key words:
Human Resource Management Work Culture Ingvar Kamprad Franchisee Model Swedish Companies Employee Retention 'Life Balance And Diversity' Benefits Policy 'Coworker Appreciation Day' 401(K) Policy Training And Development 'Paddle Your Own Canoe' Ikea Values Diversity and Creativity Advertising

*Note : This case is a simplified version of a longer case study, and is intended for learners for whom English is a foreign language. The longer version of this case study (HROB066) is available at: http://www.icmrindia.org/casestudies/catalogue/Human%20Resource%20and%20Organization%20Behavior/HROB066.htm