Yassin Oura

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Strayer University *

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2013

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Management

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Nov 24, 2024

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Yassin Oura-Aguy MGT 450 Case Study: Sustainability at IKEA Group 1. IKEA Group's People and Planet Positive Sustainability Plan: IKEA's People and Planet Positive sustainability plan is a good way to cope with the company's effects on people and the environment. A lot of large targets are in the plan, such as "climate positive" status and only employing recycled and green products by 2030. The all- around technique displays a dedication to corporate responsibility. Getting these goals done, though, is what will decide how well the plan affects the firm. Even if the objectives are lofty, they are in step with international trends and what customers demand when it comes to sustainability. The hard part is putting it into practice and getting beyond any issues that might come up. 2. Response to CMO on Avoiding Easily Copied Options: Steve Howard should advise the chief marketing officer (CMO) of the significance of placing a premium on innovation in order to distinguish the company from rivals. To maintain a competitive advantage in a highly competitive market, one must refrain from making decisions that are simple for competitors to replicate. In order to improve environmental sustainability, Howard might propose to the Chief Marketing Officer (CMO) the investigation of novel approaches that could potentially capitalise on IKEA's proficiency in the fields of design and technology. IKEA possesses the capacity to establish a unique market position and appeal to a wide range of customers and markets by tailoring and modifying its environmental initiatives to accommodate their particular needs and inclinations. Possible avenues for generating innovative concepts that rivals may seek guidance on replicating include forging strategic alliances and engaging in collaborative efforts with individuals representing diverse industries. 3. Alignment of Sustainability Strategy with Business Model:

IKEA's sustainability strategy is an ideal complement to its business model. The sustainability objectives explicit in the company's approach serve to augment its fundamental principles of affordability, design, and utility. For example, the commitment to utilising renewable materials aligns with the streamlined and economical manufacturing processes that define IKEA's prosperity. However, while the organisation transitions to more sustainable practices, conflicts may arise in the near future, which could negatively impact pricing and expense strategies. Cost-effectiveness and sustainability will need to be balanced in order to maintain consumer loyalty. 4. IKEA's Wood Supply Chain Sustainability: Certification and Traceability: Increased customer and environmental confidence are benefits. However, higher costs and complicated procurement processes may result. Vertical Integration: This sustainable option gives IKEA more control over the supply chain. A downside is high initial investment and possible inefficiency. Collaboration with NGOs: Working with non-governmental organisations (NGOs) can provide knowledge and boost legitimacy. Goal conflicts and slower decision-making may be drawbacks. Investment in Sustainable Alternatives: Introducing innovative ideas may help IKEA stand out. Problems include high R&D costs and needing to know if the product will sell. Recommendation: IKEA wants to be environmentally friendly and keep costs low, so a mix of certification and traceability (Option 1) and investing in environmentally friendly options (Option 4) makes sense. This method protects the environment while keeping things running smoothly, and it can help IKEA stand out by being creative. 5. CAGE Framework Analysis for IKEA's Entry into Brazil: Cultural, Administrative, Geographic, Economic (CAGE) Analysis: Cultural: Brazil has a rich musical history. IKEA must adapt its marketing and product lines to local tastes.

Administrative: It is important to understand the rules and regulations in Brazil. Following local laws and rules will affect how easy it is to do business. Geographic: Brazil must be evaluated, given its size and regional inequalities. Logistics and distribution methods must address these issues. Economic: Brazil's economic conditions—including purchasing power and income—will affect product positioning and price. By utilising the CAGE framework, IKEA can optimise the probability of success by customising its entry strategy to correspond with the distinct cultural, administrative, geographic, and economic circumstances of Brazil.

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