Case Study of Supply Chain Management in IKEA - Paper Example

Supply chain management is a wide range of activities that are set to improve the plan, control and execution of product flow right from the organization's raw materials and production to the distribution process and finally to the customer in a cost-effective manner (National Retail Federation, 2014). IKEA has enhanced its performance by promoting a better supply chain that upholds cost-effectiveness, retail stores, sustainability, and warehouses as one entity (National Retail Federation, 2014). On the issue of sustainability, IKEA enhances the production of their products by promoting better packaging and transportation measures which are an aspect that enhances giving back to the environment. IKEA performs various actions to improve the sustainability of its business in all ways possible (National Retail Federation, 2014). On the issue of production, the company finds the usability of any waste product in any other way as a matter of giving back to the environment (National Retail Federation, 2014). The company ships products like bottle cans to ensure that it is easy to stock its facility. IKEA drives Innovations in the supply chain by focusing on shipping products like bottle cans an approach to prevent overproduction which is an issue that can affect the environment. According to the National Retail Federation (2014), IKEA has partnered with American forests in anticipation of enhanced replanting entry program as established in 1998.

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Strategic sourcing is the critical factor that enhances operations of IKEA concerning its approaches for the supply chain. Cost-effectiveness and answers the operation of IKEA concerning supply chain (National Retail Federation, 2014). In that perspective, IKEA serves its customers with great diligence to quality service and connectivity. Cost effective supply chain service money hands IKEA can provide services to consumers at a lower price. Cost efficiency is promoted by the well-established warehouses and stores which are made to look like one entity. In that manner, it has enabled it, consumers, to roam around to check the product that they require hence allowing them to realize the worth of the facility (National Retail Federation, 2014). National Retail Federation (2014) outlined that IKEA customers pick up the products right from the warehouse in serving the process of handling products and communicating to customers. The approach is simplified concerning dealing with customers.

All processes are automated to ensure that service delivery is enhanced. For instance, IKEA about the fact that one cannot manage an organization by sitting in an office or working from my desk. In that perspective, IKEA enhances the way the employees dealing with issues related to supply chain since they have adopted a method of mounting a laptop on their bikes to ensure that they carefully monitor every detail that happens concerning supply chain (National Retail Federation, 2014). Enhance technology is incorporated in the stores and supplies of the company. Enhancement of technology and management process in relation to the supply chain promotes efficient practice in the firm. Change is considered to be a day-to-day activity with regard to the positive aspects of the business. Today, IKEA focuses on improving the technology incorporated in the warehouse, communicating with its clients, and improving the communication between employees and the top management (National Retail Federation, 2014). In such a manner, IKEA enhances the connectivity between employee's senior management and clients. Positive development and Efficiency are what drives IKEA to positively develop its supply chain and improve connectivity to its clients.

IKEA encompasses all the integrated planning and execution approaches as an aspect to optimize the flow of materials. Financial Capital information and enhancing demand planning in relation to the sourcing of the production process. Besides the company ensures that inventory management and storage transportation is promoted by adopting specific logistics that support specific software management in relation to the products in its Warehouse (National Retail Federation, 2014). Complex practices are also emphasized since the employees, and top management officials with regard to supply chain management are encouraged to mount laptops on their bikes as a way of handling any query that comes along the way concerning connectivity and harassment (National Retail Federation, 2014). Alignment of communication is also a factor that is highly valued in the facility. For instance, IKEA makes sure that it promotes collaboration with risk management by enabling the management officials to respond to issues immediately things electronic communication is highly valued.

Conclusion

In conclusion sustainability and answers, IKEA approaches to supply chain management. Sustainability, cost efficiency, and structuring its Warehouse to be one entity enables IKEA to succeed in enhancing consumers loyalty to its products. IKEA promotes better management of supply chain in relation to various factors that align with supply chain, i.e. the production process, customer management, customer satisfaction, employee management, and management of the supply of products within and outside its jurisdiction. Strategic sourcing is the critical factor that enhances operations of IKEA in relation to its approaches for the supply chain. Cost-effectiveness and answers the operation of IKEA in relation to supply chain.

References

National Retail Federation. (2014). How IKEA drives innovation in the supply chain. Retrieved from https://www.youtube.com/watch?v=NOyBX0_GtNw&feature=youtu.be