IKEA CASE STUDY 

Leadership is the process of influencing others in order to achieve group and organisational goals.（Mc Williams and Williams, 2014, p231). IKEA is a retail business that supplies for private households, which was founded by Ingvar Kamprad in 1943. 

 

 

 

 

 

 

 

 

 

 

 

 

Now, IKEA’s CEO is Peter Agnefjall.

 

 

 

 

 

 

 

 

 

 

One of the key reasons why IKEA can efficiently enable its business to make a lot of money is leadership. Leadership is an important aspect that has been devoted by the IKEA Management. Actually, international statistics reveal that IKEA is among the twenty best companies in terms of leadership. According to Testervn, 2011, IKEA was founded as a pure family business. Until now, its value is based on the concept of family business. Indeed, Ingvar Kamprad, the founder of IKEA, is one of the most successful leaders in the last century. IKEA’s effective leadership is one of the factors that led to the company’s success while talent is the prosperity of the enterprise and also is the enterprise’s greatest wealth.

 

In IKEA, each function has its own co-workers that report back to the managing director of that function.

 

1) Autocracy

This means that work is assigned by the task manager. The staff must obey and implement the work assigned to them so that the goal set by the manager is consistent in the department’s image. On the other hand, this method may cause employees to be reluctant because it limits the freedom of employees since the higher sales the better for employees.

 

2) Democracy

IKEA’s managers always encourage staffs to give advice in work. Managers consider their suggestions and make a final decision. Managers must also be able to understand the how employees think which would make employees be more efficient in work.

 

3) Laissez-Faire

Laissez-Faire means staff could relax since sometimes the tense work could lead to a fall in production. Another style is consultative, which is similar to democracy, but the target of the consultation changes to the people. This approach to management can create high levels of motivation with efficient quality output and results.

 

4) Paternalistic 

Paternalistic management focused more on employees' needs and feelings. The style is closely linked with the social needs of Maslow’s Hierarchy theory which is a theory in psychology proposed by Abraham Maslow in his 1943 paper "A Theory of Human Motivation" in Psychological Review. Maslow subsequently extended the idea to include his observations of humans' innate curiosity. His theories parallel many other theories of human developmental psychology, some of which focuses on describing the stages of growth in humans.（Mc Williams and Williams, 2014, p214).

 

Ingvar Kamprad is the perfect example of a visionary leader who shows both charismatic and transformational leadership. For charismatic leadership, Kamprad has a strong entrepreneurial character since he sets the company’s objectives and operational strategies and wants to be in control over most of all the business areas. Besides, Kamprad has based his leadership style on setting an example by encouraging hard work mixed with strict business ethics. As he has publicly stated,” if there is such a thing as good leadership, it is to give a good example, I have to do so for all the IKEA employees”. For transformational leadership, Kamprad gets employees to see beyond their own needs and self-interests for the good of the group which makes employees feel that they are a vital part of the organisation and help them see how their job fits the organisation’s vision.

 

All these aspects equate to the ideology that IKEA's leadership is based on the concept of shared values.