Key Elements Of Industrial Relations Commerce Essay

Key Elements Of Industrial Relations Commerce Essay Worldwide approximately 6,000 workers lose their lives each and every day of the yeas due to work-related accidents, injuries, or diseases. An estimation of 2.2 million people throughout the world die every year because of work-related accidents and diseases and 270 million other people suffer from serious injuries and 160 million people suffer short or long term illness due to work each year. As this is a very high number and a critical issue in worldwide ILO has been at the heart of ILOs agenda, to protect against sickness, disease and injury taking place due to employment. As such this topic can be seen as an important issue in the IR systems of the world. The objective of this assignment is to see and come to a conclusion whether ILO can make a difference in the issue of Safety and Health at Work in the world today by looking closely at ILO, their work, views and recommendations on this issue through the knowledge and information that we got from this subject Industrial Relations. This discussion paper will also help us to improve our ability to communicate and generate ideas and give more comprehensive knowledge about Industrial Relations and its concepts and to identify what ILO needs to do in order to improve and make world more aware on Safety and Health at Work as this is a very important issue in the world today for its workers and employers. Betterment of Safety and Health at Work will establish much better relationships with their employees, have more satisfied and healthy workers, as such working place and people will be more happy and problem free which will help companies to achieve their goals easily and gain profits. Henc e, the IR system throughout the world will be more efficient and effective making the working environment and world a much better and safer place. (Safety and Health at Work, n.d.) 2.0 What are IR and IIR? Traditionally Industrial Relations (IR) focuses on formal and informal institutions of job regulation which includes collective bargaining, unions, employer associations and labour tribunals. A countrys industrial relations are formed by a series of influences like that countrys history, culture, law, technology, economic policies and response to globalization. Industrial relations are defined by Dunlop (1958) as the study of employment rules and their variations over time. As per Dunlop, government agencies and management unions established a network of rules to govern the workplace and the work community. It is the study about who generates the rules prevailing worker-management relations in the workplace, the temperament of those rules, and how they are managed and standardized. (Kelly, 1999) International Industrial Relations deals with the bodies and phenomena that have cross national limitations as their industrial relations features of multi-national companies or the international labour movement. 2.1 Key Elements of Industrial Relations (Refer Appendix 1) 2.2 Systems View of IR 2.3 Approaches to Industrial Relations 2.4 Success of an IR System Success of an IR system depends on a company successfully attending to certain issues by enabling and ensuring harmony within the economy and in turn gaining social development. (Refer Appendix 2) 3.0 International Labour Organization (ILO) Overview ILO was founded on 11th April 1919 at the peace conference by the Treaty of Versialls that ended the World War I. It was created mainly in response to humanitarian concern over the conditions of workders, political and economic considerations. Since its early days the ILO has made signal contributions to the world of work as in the first International Labour Conference held in Washington in October 1919 ILO adopted six International Labour Conventions dealing with working hours in industry, maternity protection, night work for women, unemployment, minimum age and night work for young people in the industry. The International Labour Office is the permanent secretariat and operational headquarters of ILO. There are more than 40 branch offices under the leadership of a Director-General with administration and management being decentralized in each regional area. Director-General is elected every five years by the governing body and is subjected to the instructions of the governing body and responsible for efficient conduct of the International Labour Office and other which may be assigned. ILO Administration Tribunal examines employment-related complaints by officials of International Labour Office who has recognized jurisdiction and currently serving 46,000 international civil servants who are serving of former officials of around 60 organisations. Universally ILO is regarded as an authoritative source of knowledge on the world of work and they have established institutes and centres that provide specialized research, training and support for the ILOs offices and constituents. (About the ILO, n.d.) 3.1 Structure of ILO Tripartite Constituency ILO is the only tripartite U.N. agency with government, employer, and worker representatives which makes them unique forum where governments and social partners of its 185 member states economy freely and openly debate and elaborate on labour standards and policies. 3.2 How ILO Works Tripartism and Social Dialogue Most important concept ILO is the cooperation between governments and employers and workers organizations in developing social and economic progress. By bringing together governments, employers and workers ILO aims to serve the needs of working women and men and setting labour standards, developing policies and devise programmes. This very structure shows ILOs social dialogue in action as workers and employers together have an equal voice with governments in its deliberations and these views are reflected in ILO labour standards, policies and programmes. Tripartism is encouraged within ILOs constituents and member states through promotion of social dialogue between trade unions and employers by formulation and implementation of national policy on social, economic and many other issues. ILOs main work is accomplished through three main bodies (The International labour Conference, the Governing body and the Office) which is comprise of governments, employers and workers representatives where the work of Governing Body and the Office is assisted by tripartite committees covering major industries. They are also supported by committees of experts on matters such as management development, industrial relations, vocational training, workers education, occupational safety and health, and special problems of women and young workers. To examine matters of special interest to concerned regions, regional meetings of the ILO member states are periodically held. (How the ILO works, n.d.) 3.3 Mission and Objective of ILO The primary goal of the ILO today is to promote opportunities for women and men to obtain decent and productive work, in conditions of freedom, equity, security and human dignity. (Juan Somavia, ILO Director-General) 3.4 The ILO Constitution The Preamble to the Constitutions says Whereas Universal and Lasting Peace can be established only if it is based upon Social Justiceà ¢Ã¢â€š ¬Ã‚ ¦ (Please see ILO website for full text) 3.5 Scope of the ILO 3.6 Works of the ILO ILO seeks to ensure that labour standards are respected in practice as well as in principle while working with its member States as they are the global body responsible for drawing up and overseeing application of international standards. 3.7 Key Issues Tackled by the ILO Some of the key issues tackled by the ILO are: Global job crisis Social protection floor initiative Realizing the Millennium Development Goals Social Justice and a Fair Globalization 3.8 How ILO Intervenes 3.8.1 International Labour Standards and its Effects 3.8.2 Recent Status of International Labour Standards As at November 2012 the International Labour Standards can be said to have: 189 Conventions (C 189, Domestic Workers Convention, 2010) 202 Recommendations (R 202, Social Protection Floors Recommendation 2012) 185 Member States (Maldives, South Sudan, Republic of Palau) International Labour Standards are classified as; Basic Human Rights, Employment, Social policy, Labour Administration, Industrial Relations, Conditions of work, Social Security, Employment of Women, Employment of Children and Young Persons, Protection for Special Categories 3.8.3 Means of Action used by ILO 3.9 Areas Handled by ILO under Conventions and Recommendations 3.9.1 Conventions and Recommendations Conventions and Recommendations are two instruments used by the ILO to set international labour standards to set out basic principles and rights at work. Conventions are legally binding international treaties that might be ratified by member states and recommendations serve as non-binding guidelines. As convention lays down the basic principles to be implemented by ratifying countries while related recommendations complements the convention by giving more thorough guidelines on how it could be applied. Recommendations can also be self-ruling and not linked to any convention. There are 8 fundamental conventions and four priority governance conventions. (Refer Appendix 3) Total Number of Conventions: 189 Convention Fundamental: 8 Convention Governance (Priority): 4 Up to date Conventions: 82 Shelved Conventions: 25 Withdrawn Conventions: 5 Conventions in force: 153 Number of Protocols: 5 Number of Recommendations: 202 Withdrawn Recommendations: 36 3.9.2 Why these Areas are Important Some important Conventions and Recommendations are: No. 29 Forced Labour Convention (1930) No. 87 Freedom of Association and Protection of the Right to Organize Convention (1948) No. 98 Right to Organize and Collective Bargaining Convention (1949) No. 100 Equal Remuneration Convention (1951) No. 105 Abolition of Forced Labour Convention (1957) No. 111 Discrimination (Employment and Occupation) Convention (1958) No. 138 Minimum Age Convention (1973) and Recommendation NO. 190 No. 182 Worst Forms of Child Labour Convention (1999) and Recommendation No. 146 (ILO Conventions and Recommendations, n.d.) Details are given in the Appendix (Refer Appendix 4) T F 3.10 Supervision and Monitoring of Application of Standards ILO has a large standard-setting and supervision agenda and is essentially based on two types of procedures a regular procedure and ad hoc procedure which is activated on adversarial basis and is described in its Constitution. Present structure is the outcome of a series of adjustments made by the Conference and the Governing Body throughout the years in order to adapt the procedure to the growing numbers of conventions and states that are parties to them. As ILO is a tripartite organization its constituents and decision makers are not only the governments but also workers and employers and they all play an active role in the supervision of ratified conventions. (Romano, 1996) Below are some of supervisory documents, reports and bodies Annual Reports Under Article 22 ( ILO Constitution)- Ratified Conventions Under Article 19 ( ILO Constitution)- Non-ratified Conventions Committee of Experts on Application of Conventions and Recommendation (CEACR) Conference Committee on Application of Standards Global Report Reports under Declaration of Social Justice for Fair Globalization of 2008 3.11 ILOs Complaint Procedure ILOs complaint procedure is regulated by Articles 26 to 34 of the ILO Constitution by which a complaint can be judged against a member state not observing a convention to which it is a party and can be filed by: Another member state also having ratified the same convention Any delegate to the ILO Conference (each member state is also represented by a delegate representing the employers and a delegate representing the workers) The ILO Governing Body (composed of 28 state representatives, 14 representatives from employers and 14 representative of workers) This shows that a compliant cannot be filed by an individual and is mostly done by trade unions of the country which are represented in the ILO (Complaints, n.d.) Below are committees for complaints: Committee on Freedom of Association Commission of Inquiry 3.11.1 Declaration of Principles and Rights at Work and its Follow-up These declarations makes sure that these rights are universal and that they apply to all people in all states, regardless of their economic development and the commitment is supported by a follow-up procedure. The Declaration and its Follow-up provides three ways to help countries, employers and workers to achieve the full potential of the Declarations objective. They are: Annual Review composed of reports from countries that have not yet ratified Global Report Technical cooperation projects (About the Declaration, n.d.) 3.11.2 Core Labour Standards 4.0 Safety and Health at Work Every 15 seconds, a worker dies from a work-related accident or disease. Every 15 seconds, 160 workers have a work-related accident. There are more than 2.3 million deaths per year everyday, 6,300 people die as a result of occupational accidents or work-related diseases. From these 317 million accidents occur on the job annually which results in extended absences of workers from work. Hence, the human cost of this danger is huge and the economic burden caused due to poor occupational safety and health practices is anticipated at 4 percent of global Gross Domestic Product each year. 4.1 What is Safety and Health at Work? Safety and Health conditions at work differ from country to country, economic sectors and even social groups. Their concept of work culture is a reflection of the essential value systems adopted by that party and such cultures can be seen in practice in the managerial systems, personnel policy, principles for participation, training policies and quality management of the task. Safety and Health at work or Occupational safety and health (OSH) aim is the promotion and upholding of maximum level of physical, mental and social well-being of workers in all occupations; in summary the adaptation of work to man and of each man to his job. Main goal is to promote a safe and healthy work environment for every worker. The main focus is on three different objectives; The maintenance and promotion of workers health and working capacity The improvement of working environment and work to become conducive to safety and health, and Development of work organizations and working cultures in a direction which supports health and safety at work while doing so promoting a positive social climate and smooth operation and enhancing productivity of the work. 4.2 Reasons for selecting this Topic Main reason why I chose this topic is because today this is one of the main concerns in the world and the work environment. As industrial relations is a very important concept in each and every country today as creating and establishing a safe work environment is vital to the success of any business and is one of the best ways to retain staff and get their maximum productivity. As such this is very important and essential even though it might cost a bit to implement such safe practices and install safe equipment but not taking any action might lead to severe problems. As I used to work before and after finishing my studies I plan to go and start work I feel that safety in any workplace is essential and that businesses need to ensure this in order to keep their staff happy and make them work to their full potential. I also feel that knowing and understanding the OHS laws and new work health and safety laws will help me to avoid unnecessary costs and damage to myself and to my fellow w orkers and provide me satisfaction and an organization the foundation they need to achieve long-term success. When I go back to work I want to go to a place where there is best safety and health at work which will make my life safer in the work environment. This also a very crucial issue that people need to give their time and effort to make it better, specially international organization like ILO, to take notice and do something and make a difference in the world so that more people are aware of this problems, solutions and actions that will taken if there is bad safety and health at work as deaths and injuries take a primarily a heavy toll in developing countries, where most of the population is occupied in dangerous activities, such as agriculture, fishing and mining. Also the most affected are the poorest and least protected, often women, children and migrants throughout the world. 4.3 ILOs Approach on Safety and Health at Work ILO has a Programme on Safety and Health at Work and the Environment, SafeWork, which aims to create worldwide awareness of the scope and consequences of work-related accidents, injuries and diseases. SafeWorks aim is to place the health and safety of all workers on the international agenda; and to encourage and support practical action at all levels. As ILO says Decent work is safe work. (Safety and health at work, n.d.) The ILO published ILO-OSH in 2001 titled as Guidelines an on occupational safety and health management systems to help organizations with introducing OSH management systems. These guidelines encourage constant progression in employee health and safety, accomplished through a constant process of policy, organization, planning implementation, evaluation and action for improvement, all supported by constant auditing to resolve the success of OSH actions. In order to assist employers to keep up with the speedily changing and competitive industrial environments the ILO management system was created. ILO recognized that national legislation is vital but inadequate on its own to tackle the challenges faced by industry as such they selected to guarantee free and open distribution of administrative tools in the forum of occupational health and safety management system supervision for everyone to provide everyone with tools for industry to create safer and healthy working environment and set up a positive safety cultures within the organizations. 4.4 Safety and Health at Work Standards The ILO Constitution put forth the principle that workers should be protected from sickness, disease and injury taking place from their employment. ILO standards on occupational safety and health supplied fundamental tools for governments, employers, and workers to set up such practices and to provide for maximum safety at work. ILO have also adopted more than 40 standards in particular dealing with occupational safety and health, as well as over 40 Codes of Practice and almost half of ILO instruments deal directly with occupational safety and health issues. (Refer Appendix 4) 4.5 Good Practices of Safety and Health at Work in Different Countries The Healthy Workplaces Campaigns (formerly known as European Weeks for Safety and Health at Work) running since 2000 are one of EU-OSHAs principal tools for raising awareness of issues related to occupational safety and health, and promoting the idea that good health and safety is good for business. Also these campaigns are now largest of their kind in the world. (Healthy Workplaces Campaigns, n.d.) Some other good practices are: Assistance in planning and organization of all features of work, at all stages, to make sure working conditions which will not in the short or longer term damage the health and safety of the employees; Collaboration with the Internal Safety service, Safety Committee and involvement of workers, to make sure that all aspects of health and safety at work are incorporated in the workplace review and the solution of problems; Primary elements of the assessment principles of prevention are implemented in advising how the work is to be planned and performed. All company documentation needed for the risk assessment is collected; workplace and individual employee files are kept. Workplace assessment is performed in an efficient and practical way also in regard to the environment. Appropriate directions to the workers and their education are included; and Necessary training and expert assistance when needed are ensured. 4.6 Safety and Health at Work Situation in the Real World and its Reasons 4.6.1 Situation in General throughout the World Work plays an essential role in peoples lives as most workers spend at least eight hours a day in the workplace, whether it is an office, factory, on a plantation, etc. Hence, it is vital that work environment to be safe and healthy but this is not the case for many workers around the world. Each and every day workers around the world are faced with different health hazards, like dusts, gases, noise, vibration, extreme temperature and many more. It is very unfortunate that some employers take little responsibility for the protection of the workers and their health and safety. Actually some employers have no idea that they have the ethical and legal responsibility to protect their workers and due to this lack of knowledge and attention given to health and safety and hazards, work-related accidents and diseases are common throughout the world. (Your health and safety at work, n.d.) Map 1: Maplecroft Global Map of Health and Safety Risk 2011 http://human-rights.unglobalcompact.org/media/v_hr_solutions-20110825_121354/hr_solutions/images/global/health_and_safety.jpg 4.6.2 Safety and Health at Work in Relation to Sri Lanka Activities relating to occupational safety and health (OSH) in Sri Lanka are operated through priority outcome 2, Enhanced labour administration and promotion of equitable employment practices of the Decent Work Country Programme for Sri Lank 2008-2012. As occupational Safety and Health deals with the safeguard of the most valuable and indispensable human asset of any country, its workforce which includes not only the wage employment but all the working population who engages in some kind of self economic activity contributing to national development. According to ILOs estimates, in Sri Lanka about 4,000 accidents are being reported annually and around 600,000 working days each year are lost due to accidents. Since year 1896 till 1950 in Sri Lanka considerations on Occupational Safety and Health was confined to Mines and to the relevant machinery and only extended to Factories under Factory Ordinance to date. These shortcomings in relation to Occupational Safety and Health coverage in the formal sector is a key concern because only 30 percent of the labour force is covered by the statutory provision on OSH. As the government realized the need for wider coverage the state took responsibility to ensure safe and non-exploitative work environment for all Sri Lankans and the Ministry of Labour Relations and Manpower embarked on formulating new legislation with technical assistance from ILO. As a result the new Safety Health and Welfare at Work Act has been approved by Cabinet now and is expected to be presented to Parliament for their approval. (Safety and Health at work, Sri Lanka, 2012) 4.7 What is ILO doing about Safety and Health at Work at Present? Since its very beginning 90 years ago the protection of workers lives and health has been a key objective of the ILO. As todays rapidly changing world with its technological change and fast-paced and globalised economy causes new challenges and pressure on all areas of the world of work, especially for occupational safety and health which ILO has made as an integral element in their Decent Work Agenda. The Programme on Safety and Health at Work and the Environment (SafeWork) is ILOs lead unit on OSH which plays an important role in sharing best practices in the field and raising awareness of OSH issues. The four major goals of SafeWork are: Develop preventative policies and programmes to protect workers in hazardous occupations and sectors; Extend the effective protection to vulnerable groups of workers falling outside the scope of traditional protective measures; Better equip governments, employers and workers organizations to address problems of workers well-being, occupational health care and the quality of working life; and Document the social and economic impact of improving workers protection so that it can be recognized by policy and decision makers. (World Day for Safety and Health at Work 2009, 2009) The celebration of Word Day for Safety and Health is an essential part of Global Strategy on ILOs Occupational Safety and Health as they promotes the establishment of a global preventative safety and health culture by involving all stakeholders focusing international attention on emerging trends in the field of occupational safety and health and on the magnitude of work-related injuries, diseases and fatalities worldwide. It is also the day that worlds trade union movement holds its International Commemoration Day to honour the dead and injured workers who were the victims of occupational accidents and diseases they organize worldwide mobilization and campaigns on this date. The world day for Safety and Health at Work held on 28 April every year has become one of the most important international events for promoting OSH. Each year there is a theme which is built on promoting a preventative safety and health culture in the workplace with different sub-themes. Theme of 2012 centers on the promotion of occupational safety and health (OSH) in a green economy as there is a change in the world to a greener and more sustainable economy. In this as the green economy grows it is imperative that safety and health at work are incorporated into green jobs policies. This means that integrating risk evaluation and management measures in the life cycle study of all green jobs. (World Day for Safety and Health at Work in 2012: Promoting safety and health in a green economy, n.d.) ILO has also been actively supporting initiatives in some countries for developing national policies and programmes where else in other countries closely working with their governments to establish national tripartite advisory bodies for OSH. 4.8 Monitoring and Control Processes Adopted by ILO The ILO has developed an amount of comprehensive instruments to promote its work in the field of OSH and most of these international instruments are concerned with specific hazards or specific sectors. The ILO Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187) and its accompanying Recommendation (No. 197) describes requirements for countries to promote OSH through national OSH systems and programmes, building a preventive safety and health culture and applying a systems approach to the management of OSH and to make this happen employers, workers and governments all play key roles. Below table shows ILOs Strategic Approach on Occupational Safety and Health C:UsersuserDesktopilo.png There are three main components of the Promotional Framework Convention as per the table. (Refer Appendix 5) ILO has also established a knowledge management hub in the International Occupational Safety and Health Information Centre (ILO-CIS) to provide workers and employers with relevant up to date information regarding health and safety issues. The centre supports the ILOs action plan on knowledge and management and international association by being accountable for: Compiling OSH related information and ensuring worldwide access to it Creating and disseminating ILO OSH publications (including the ILO Encyclopedia and related products) Maintaining an international network of national and international OSH institutions. ILOs principle that Decent Work must be Safe Work, SafeWork aims to create worldwide awareness of the dimensions and consequences of work-related accidents and diseases; place OSH on the international and national plans and provide assistant to the national efforts for the development of national OSH systems and programmes in line with applicable international labour standards. 4.9 How it works in China and Indonesia ILO works with governments, workers and employers in China and Mongolia and are strengthening their efforts to prevent accidents and diseases at work by promoting a preventative safety culture via the biennial China International Forum on Work Safety and the observation of World Day on Safety and Health at Work each year on April 28. Also national occupational safety and health systems including legal frameworks, inspections, and occupational accidents and injuries reporting, training and information, and social dialogue are being strengthened in China. ILO has also been promoting a practical training programme on WISE (Work Improvement in Small Enterprises) in SMEs to meet the challenges in China as many young and migrant workers are employed in small and medium-sized enterprises. ILOs safety and health mandate also include helping workers, employers and governments reaction to the challenges created by HIV/AIDS and other health and psychosocial risk. Risk management focuses on prevention and anti-discrimination in the workplace as a key for successful response. In China Safety and health at work is a workers human right and an essential part of people-oriented, safe development plan put forward by their government as a healthy workforce and safe and productive enterprises are part of their sustainable development strategy. (Safety and health at work, Co-Beijing, n.d.) In Indonesia ILO has closely worked with tripartite partners to strengthen national OSH system and to ensure that OSH issues are fully incorporated and covered in all ILOs programmes as a primary part of the ILO Decent Work agenda in Asia. Under ILO-Jakarta all the projects and programmes have a component to make sure that improvement of OSH execution through research and training programmes. In Indonesia also ILOs health and safety mandate includes assisting workers, employers and governments reaction to the challenges faced by HIV/AIDS and by influenza pandemic through its HIV and AIDS programme and Avian Influenza and the Workplace project. In order to realize the goals of Asian Decent Workk Decade ILO is also helping Indonesia develop and apply preventative safety and health culture in workplaces. The Manpower Act No. 13 of 2003 mandated that every enterprise have to apply OSH management system to guard the safety of the workers and to comprehend the best productivity. Within the enterprise the cooperation of workers is essential for the prevention of occupational accidents and diseases. The enterprise policy should also reflect that workers duties in hazard control have as their counterpart the recognition of certain basic rights; particularly workers have the right to remove themselves from danger and refuse to carry out or continue work if they have rational justification and believe that it presents impending and serious threat to the

Children And Television Essay -- essays research papers

Children are vulnerable and easily swayed by everything around them. Parents try to do everything in their power to protect their children from unhealthy environments. They child-proof everything, but they don’t realize that thousands of strangers enter the home everyday...through the television. Television is in 98% of North American homes and the average Canadian child watches four hours of television every day. Most parents do not realize that their children are watching violence-ridden television programs and that by the age of 18 the average North American child will have viewed over 200,000 acts of television violence. Children should not be allowed to watch violent television programs because children are easily desensitized to violence, they are unable to distinguish reality and fantasy and they copy what they see on television. Children are very impressionable and are easily desensitized to the violence they see on television. Research has shown that young children are aroused by aggressive scenes on television and show higher levels of emotion when watching aggressive programs than when watching passive programs. The arousal diminishes with repeated exposure to television and the violence no longer affects children. When people are no longer aroused by violence they become less responsive to human suffering and may not be as quick to help or may not intervene during an emergency. When there is a problem, arousal levels are high and quick action is taken but when arousal levels do no increase then people are not as concerned about the problem and may not jump in to solve it. Because society is becoming more aggressive, there will be more violent sociatal situations and if people do not take swift action and help because they are desenstiaed to the violence, many lives could be lost. Young children have trouble distinguishing between reality and fantasy. They cannot make objective evaluations, cannot form logical conclusions and cannot sort out relevant data about the things they see on television. They don’t understand the difference between what is possible and what is actually probable. If a young child see someone on TV jumping off a mountain and landing on their feet, they believe that it is real becausw they saw it happen with their own eyes and do not have the capacity to believe otherwise. Children do not develop the capacity to dis... ...eir children are watching in addition to the type of programs. In the formative years, they should also explain to their children the difference between "pretend" and "reality." For example, if the child sees someone getting shot on a TV program, the parent should point out that these are just actors pretending to get shot with a pretend gun. Frank discussions about the repercussions of real violence should also be discussed, with the focus on "right" and "wrong" behavior. This will help develop a sense of morality within the child which will allow him or her to make more informed decisions. The hue and cry about reducing the amount of violence on TV has had little affect on programmers or producers. The best defense parents can mount against the cumulative affects of television violence is to clearly explain to their children what is acceptable behavior. If parents explain their expectations to their children, they will be better able to f ormulate their own opinion regarding violence within a strong moral framework rather than within a blurred and confused sense of television reality which glorifies violence and makes is seen acceptable.

Comedys Adjoining Terror: The Ponder Heart Essay -- Michael Kreyling

Comedy's Adjoining Terror: The Ponder Heart Michael Kreyling essay called, "Comedy's Adjoining Terror: The Ponder Heart", opens with the critic drawing a parallel between The Ponder Heartand Faulkner's Intruder in the Dust. He warns us that if we look too hard into the serious side of The Ponder Heart, we may lose the humor. The Ponder Heart takes place in the Beulah Hotel in Clay, Mississippi and is told with all the characteristics of a dramatic monologue. According to Kreyling, Edna Earle is a troubled soul that is struggling for fulfillment and freedom while being trapped by the dictates of society and filling the role that society has prescribed for her. The source of comedy in The Ponder Heartis this struggle between laughter and outrage, and stability and chaos. The critic sees this struggle as life that collides with external restrictions. This releases the vital energies that exist in Welty's writing, whether she chooses to use two persons or conflicting natures in one person. Another way Kreyling illustrates this point is through the mythological personas of Apollonian and Dionysis. Edna Earle represents the Apollonian ways of living which include order, knowledge and experience. Uncle Daniel represents the Dionysian side of life as he simply does what comes naturally. He listens to spontaneous impulses that rule his life. Michael Kreyling states that there is no winner or victor in The Ponder Heart. It is basically stagnant although time continues to move on. Time is the arch enemy of Edna Earle. Through time, she must face the fact that things are changing and what was important in her world is not always very important to the new social set. The critic tells us that the result of the trail, while... ...re lady bike riders, the wrong element, speeding cars, and the Peacocks. These things bring home to Edna Earle the fact that she must change to survive in life and one is left with serious doubts as to whether she ever will. I have to agree with Michael Kreylingthat if one looks too deeply into The Ponder Heart, one loses the sense of comedy that it first inspires. I'm not sure this book should be delved into to a great extent. I prefer to see Edna Earle as a delightful, entertaining person, and although I agree with Kreyling's assessment of the characters, I prefer to concentrate on the humorous side of The Ponder Heartbecause I think that was Eudora Welty's main purpose. Works Cited: Kreyling, Michael. "Comedy's Adjoining Terror" The Ponder Heart". Eudora Welty's Achievement of Order. Baton Rouge: Louisiana State University Press. 1980.

The Competitive Advantage of Ikea

DEPARTMENT OF TECHNOLOGY AND BUILT ENVIRONMENT The Competitive Advantage of IKEA and IKEA in China Zhi Li June 2010 Master’s Thesis in Logistics and Innovation Management Master of Science in Logistics and Innovation Management Supervisor: Lars Steiner Abstract Title: Author: Supervisor: Purpose: The competitive advantage of IKEA and IKEA in China Zhi Li Lars Steiner The main purpose of this master thesis is to describe the IKEA concept and discuss the application in China.After research the history of IKEA, interview with the manager of IKEA store, and find the information from the web and thesis, use the theory of competitive advantage to describe the IKEA concept and the competitive advantage which is the way that IKEA used to get the success. Secondly, discuss the application in China and give IKEA the suggestions to develop the competitive advantage in China market. Methods: Because IKEA is not a public company, I cannot get too much data.I browsed the official website of IKEA to get much information about the introduction of IKEA’ corporate culture, strategies, copartner, history and the data of IKEA financial and work group. I find some English and Chinese books, thesis and reports try to find more data and more good ideas of Chinese scholars. Visit and observe the IKEA store and note my questions. I tried to have an interview with IKEA store in china, but failed. Fortunately, I got an interview with Hans Karlsson which is the logics manager of IKEA store in Gavle.He explained the competitive strategy of logistics, the competitive advantage about IKEA and the next step IKEA may do in china. Try to analysis the different culture and other problem that IKEA have to face. Analyze all the data and the idea I have got and use the theory of Michael Porter to finish this thesis. IKEA should have many innovations to adapt to the China market. â€Å"At IKEA our vision is to create a better everyday life for the many people. Our business idea suppor ts this vision by offering a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. (Our vision and business idea, http://www. ikea. com/ms/en_US/about_ikea/the_ikea_way/our_busine ss_idea/index. html) It seems not achieved in China market yet. Firstly, IKEA should have greater cooperation with local suppliers to get more competitive advantage of cost leadership. Secondly, according 1 Conclusions: to the specialty of China market, IKEA should have some more adjustment to satisfy so many China picky customers. Thirdly, IKEA should intensify propaganda work to let more customers understand and accommodate the IKEA model. As an outcomer, there is a long way to be the winner in this huge and potential market.After a long time to research the China market, IKEA already understand the China market more than before. With accelerating the speed of expand, the success of IKEA in China market is only the p roblem of time. Key words: IKEA, competitive advantage, IKEA model, China market 2 Contents page 1. Introduction †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 6 1. 1. Background †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 1. 2. Purpose †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 7 1. 3 . Research question†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 7 1. 4. Structure of the thesis †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 7 2. Theoretical framework †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 8 2. 1.The five competitive forces that determine industry profitability †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 8 2. 1. 1. Bargaining power of supplie rs†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 9 2. 1. 2. Bargaining power of customers†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 9 2. 1. 3. Threat of new entrants †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 10 2. 1. 4. Threat of substitute products †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 0 2. 1. 5. Competitive rivalries within an industry †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢ € ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 10 2. 2. Generic competitive strategies †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 10 2. 2. 1. Cost leadership †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 11 2. 2. 2. Differentiation †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 12 2. 2. 3.Focus †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 12 2. 2. 4. Pursuit of more than one generic strategy †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 12 3. Methodology †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 13 4. Findings †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 15 4. 1. The introduction f IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 15 4. 2. The history of IKEA from the web of IKEA†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 16 4. 2. 1. 1920 †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 16 4. 2. 2. 1940s-1950s†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 16 4. 2. 3. 1960s-197 0s†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 7 4. 2. 4. 1980s †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 17 4. 2. 5. 1990s †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 17 4. 2. 6. 2000s †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 18 4. 3. The data from the web of IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 19 4. 4.The information from interview †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 19 3 4. 4. 1. The logics process of IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 19 4. 4. 2. The market segment †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚ ¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 22 4. 4. 3. The logistics strategy all over the world†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 22 4. 4. 4. The China market †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 2 4. 4. 5. The next step that IKEA can do to increase the competitive advantage especially in logistics†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 23 4. 4. 6. The competitor of IKEA†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 23 4. 4. 7. The uniform of IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 23 4. 5. The compare with the competitor of IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 3 4. 6. The situation of IKEA in China at this stage†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 24 4. 6. 1. The reason of the price problem †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 24 4. 6. 2. The substance of the IKEA dilemma in China †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 24 4. 6. 3. The reason that the speed of IKEA develop slower than the competitor †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 24 4. 6. 4. The challenge and the innovation of IKEA in China †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 25 4. 6. 5.The disadvantage of IKEA in China†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 25 4. 6. 6. The model of IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 25 5. Discussion †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚ ¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 25 5. 1. The competitive advantage model of IKEA †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 25 5. 2. The three ways used to increase the competitive advantage †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 26 5. 2. 1.Overall cost leadership †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 26 5. 2. 2. Differentiation †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢ € ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 27 5. 2. 3. Focus †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 27 5. 2. 4. Pursuit of more than one generic strategy †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 27 5. 3. The suggestion for IKEA in China †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 8 5. 3. 1. The advertisement †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 28 5. 3. 2. The company culture †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 28 5. 3. 3. The cooperation of local supplier †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 28 5. 3. 4. The environment-friendly products †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 29 5. 3. 5. Flexible strategies†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 9 6. Conclusions †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 29 4 Reference†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 31 Appendix †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 32 5 1. Introduct ion The purpose of this chapter is introduction the background of IKEA, the purpose, the research questions. 1. 1.Background â€Å"The IKEA Concept is based on offering a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. Rather than selling expensive home furnishings that only a few can buy, the IKEA Concept makes it possible to serve the many by providing low-priced products that contribute to helping more people live a better life at home. †(http://franchisor. ikea. com/showContent. asp? swfId=concept2). The IKEA Concept guides the way IKEA products are designed, manufactured, transported, sold and assembled.All of these factors contribute to transforming the IKEA Concept into a reality. In the booklet â€Å"the future is filled with opportunities†, Ingvar Kamprad, the founder of IKEA, says that:† IKEA does not just want to win your brain. IKEA also wants to win your he art. † No matter whom you are, formal education or informal education, a worker or a manager, you can find IKEA is a place which is full of opportunities. â€Å"It is up to you† is a common expression in IKEA. (Salzer, 1994) IKEA starts the furniture business in the 1940s. From a small company become to a world famous transnational corporation, the development speed of IKEA is very fast.According to the â€Å"IKEA at a glance- financial year 2009†, the IKEA trademark represents the leading home furnishings brand in the world with more than 300 stores in more than 35 countries, more than 15,000 co-workers and 46 production units. They sold totaled 21. 5 billion Euros at 2009. (http://www. ikea. com/ms/en_US/about_ikea/pdf/FF09_GB. pdf, 2010-5-29). How does IKEA develop quickly and keep strong competition in the furniture industry? That makes me have strong interesting about IKEA. With China join the WTO, more and more foreign companies entered China market. IKEA e ntered the China market in 1998.Recently the biggest IKEA store in Asia opened in Shenyang. But there are only 12 stores in China now. Compared with other foreign furniture companies, the development speed of IKEA is seems too slow in China. On the other hand, China is already become to the biggest purchasing country which is about 20%. But the sales per region are only 5% in Asia and Australia. What is the problem IKEA have in China? What should IKEA change in China? I will use theory of competitive advantage to find the reason why IKEA can get the success. Because the IKEA is not a public company, I cannot find too much data. So I 6 have to research the model of IKEA.I tried to have an interview with the manager of IKEA store in China to know the situation and the future plan of IKEA. Unfortunately, they did not have time. I tried to connect with the manager of IKEA in Gave. Luckily, the logics manager Hans Karlsson gave me a chance to have the interview. So we meet at 2010-05-21. He introduced the logics process of IKEA and answered some questions I have. But he cannot give me the data either. I browsed the website of IKEA, and read many books, journeys, even newspaper report to find the data, the introduction of IKEA model, and the opinions of foreign and Chinese scholar about IKEA.The research of this thesis contains the history of IKEA in Sweden, the IKEA concept, international expansion periods. Then I find out what IKEA should change in the future to adapt the China market better. 1. 2. Purpose The purpose of this thesis is to describe the IKEA concept and discuss the application in China. After research the history of IKEA, interview with the manager of IKEA store, and find the data from the web and the thesis, using the theory of competitive advantage explain the advantage, disadvantage, and situation of IKEA.According to the special situation of China market and Analysis the different opinions of IKEA, discuss how to develop the concept of IKEA to k eep the competitive advantage of IKEA in China market. Finally, get the experience to these foreign companies which want to enter China market and these Chinese foreign companies which are still in the early stage. 1. 3. Research question As the topics of this thesis are competitive advantage of IKEA and IKEA in China. After collect and analysis the information I got, these research questions will be solved.A, what is the competitive advantage of IKEA? B, what is the problem that IKEA have in China market? C, what is the next step IKEA should do to increase the competitive advantage in China market? 1. 4. Structure of the thesis The structure of this thesis is as the follow steps: 7 Chapter 1- introduction This chapter is to introduce the background of IKEA, the research purpose, the research question and the structure of this thesis Chapter 2- theoretical framework This chapter is to introduce the theory of competitive advantage which we will be used.There are including â€Å"the five competitive forces that determine industry profitability† and â€Å"generic competitive strategies†. Chapter 3-methodology This chapter is to describe the process that I find the question and use the methodology to solve the question. Chapter 4-finding This chapter is to introduce the information I collected. There are including the history of IKEA, the data from the web of IKEA, the information from interview and the opinions from other thesis. Chapter 5-discussion This chapter is use the theory and the finding to analysis the competitive advantage model of IKEA and discuss the three ways sed to increase the competitive advantage. Then, finds out the reason that helps IKEA get success. Chapter 6- conclusion According to the situation of China market, finds out the disadvantage of IKEA in China and gets the suggestions. 2. Theoretical framework The purpose of this chapter is to do the literature review of the five competitive forces the determine industry profitabi lity and the generic competitive strategies. 2. 1. The five competitive forces that determine industry profitability â€Å"The first fundamental determinant of a firm’s profitability is industry attractiveness.In any industry, whether it is domestic or international or produces a product or a service, the rules of competition are embodied in five competitive forces: the entry of new competitors, the threat of substitutes, the bargaining power of buyers, the bargaining power of suppliers, and the rivalry among the existing competitors. †(Porter, 2008) The collective strength of these five competitive forces determines industry 8 profitability. Figure 1: the five forces that shape industry competition http://sites. google. com/site/greenlightgocoaching/news 2. 1. 1.Bargaining power of suppliers The bargaining power of suppliers is also described as the market of inputs. The suppliers influence the profitability and product competitiveness by increasing the price of input s elements and reducing the unit quality value. The bargaining power of suppliers is depend on the inputs elements. When the inputs elements is big part of total cost, the inputs elements is very important in the product process or influence the quality of buyer product, the suppliers have strong bargaining power. (Porter, 2008) 2. 1. 2. Bargaining power of customers The bargaining power of customers is lso described as the market of outputs: the ability of customers put the firm under pressure, which also affects the customer's 9 sensitivity to price changes. The customers influence the profitability by asking for low price, good quality and service. (Porter, 2008) 2. 1. 3. Threat of new entrants When the balance of supply and demand is imbalance, the new entrants will be attracted by high returns of the profitable market. New entrants not only bring new technology and resource, but also reduce the profitability of all companies in this industry. (Porter, 2008) 2. . 4. Threat of su bstitute products Because the products could substitute, two companies which are in same industry or in different industries may compete with each other. Firstly, the profitability could be reduced by the substitute products. Secondly, because of the substitute products, companies have to improve the quality, reduce the cost and price, or make product more features. (Porter, 2008) 2. 1. 5. Competitive rivalries within an industry For most industries, the intensity of competitive rivalry is the major determinant of the competitiveness of the industry.Competitive rivalry is likely to be based on dimensions such as price, quality, and innovation. Technological advances protect companies from competition. This applies to products and services. Companies that are successful with introducing new technology are able to charge higher prices and achieve higher profits, until competitors imitate them. (Porter, 2008) 2. 2. Generic competitive strategies â€Å"Though a firm can have a myriad o f strengths and weaknesses compared with its competitors, there are two basic types of competitive advantage a firm can possess: low cost or differentiation. (Porter, 1985) The two basic types of competitive advantage influence the five competitive forces that determine industry profitability. â€Å"The two basic types of competitive advantage combined with the scope of activities for which a firm seeks to achieve them lead to three generic strategies for achieving above-average performance in an industry: cost leadership, differentiation, and focus. The focus strategy has two variants, cost focus and differentiation focus. â€Å"(Porter, 1985) 10Figure 2: three generic competitive strategies Each of the generic strategies involves different route and target to competitive advantage, â€Å"The cost leadership and differentiation strategies seek competitive advantage in a broad range of industry segments, while focus strategies aim at cost advantage (cost focus) or differentiation (differentiation focus) in a narrow segment. † (Porter, 1985) 2. 2. 1. Cost leadership Cost leadership is the clearest of the three generic strategies. In this strategy, firm should try their best to reduce the cost. If a firm can achieve and sustain overall cost leadership, then it will be an above-average performer in its industry provided it can command prices at or near the industry average. At equivalent or lower prices than its rivals, a cost leader’ low-cost position translates in to higher returns. A cost leader, however, cannot ignore the bases of differentiation. If its product is not perceived as comparable of acceptable by buyers, a cost leader will be forced to discount prices well below competitors’ to gain sales. This may nullify the benefits of its favorable cost position. (Porter, 1985) if customers think the product is not good as the product of competitor, the firm has to reduce the price. The firm can get high profitability until a cost leade r gets the cost leadership parity in the bases of differentiation. 11 2. 2. 2. Differentiation The second generic strategy is differentiation. â€Å"In a differentiation strategy, a firm seeks to be unique in its industry along some dimensions that are widely valued by buyers. It selects one or more attributes that many buyers in an industry perceive as important, and uniquely positions itself to meet those needs.It is rewarded for its uniqueness with a premium price. The means for differentiation is peculiar to each industry. Differentiation is based on the product itself, the delivery system by which it is sold, the marketing approach, and a broad range of other factors. † (Porter, 1985) If the extra cost for differentiation is less than the premiums price, the firm which has the competitive advantage of differentiation can get better profitability than other firms in the industry. Because the extra cost for differentiation is the disadvantage of the differentiation, the fi rm cannot ignore the cost position.So, only based on the price is almost the same as competitor, the differentiator could get the high profitability. 2. 2. 3. Focus The third generic strategy is focus. â€Å"This strategy is quite different from the others because it rests on the choice of a narrow competitive scope within an industry. The focuser selects a segment or group of segment in the industry and tailors its strategy to serving them to the exclusion of others. By optimizing its strategy for the target segments, the focuser seeks to achieve a competitive advantage in its target segments even though it does not possess a competitive advantage overall.The focus strategy has two variants. In cost focus a firm seeks a cost advantage in its target segment, while in differentiation focus a firm seeks differentiation in its target segment. â€Å"(Porter, 1985) The firm can focus the time, the resource and the money on the segment to get the competitive advantage. If the firm can g et the competitive advantage of cost leadership or differentiation in its target segment, the firm could provide customer the better service and meet the special requirement. Because of the different requirements of customer, there are always many segments in one industry. . 2. 4. Pursuit of more than one generic strategy Each generic strategy is different way to create and sustain competitive advantage. Usually a firm has to choice one of them or it will become stuck in the middle. â€Å"The benefits of optimizing the firm’s strategy for a particular target segment (focus) cannot be gained if a firm is simultaneously serving a broad range of segments (cost 12 leadership or differentiation). Achieving cost leadership and differentiation are also usually inconsistent, because differentiation is usually costly.Conversely, cost leadership often requires a firm to forego some differentiation by standardizing its product, reducing marketing overhead, and the like. † (Porter , 1985) If a firm can use the strategies flexible, like use more than one strategy at the same time, this firm will get a great competitive advantage and market share. 3. Methodology Before I went abroad, I know many worlds’ Fortune 500 companies. All of them have the secret of success, like Coca-Cola have the unique recipe, the Volvo famous for the safety of the car and so on.But I never heard the IKEA before. When I started to study in Gavle, I want to buy some cheap articles for daily use, everyone told me to IKEA. Not only that, when I travelled in Europe, I found I can find the IKEA store almost in every city. Why IKEA is so popular? What is the secret of success? And why I never saw IKEA store in China? Does IKEA do not want have the market of China or IKEA is in a dilemma in China market? These questions attracted me so deeply. After I browsed the web of IKEA, I got some information of IKEA.The concept of IKEA is based on a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them and to helping more people live a better life at home. Simply, the target customer is everyone. The strategy is low price. And they use many ways to achieve the aim of low price like flat packs and self-assembly furniture. I noticed that the China had already become the biggest purchasing country which is about20%. On the contrary, the sale per region in Asia and Australia is only5%.IKEA have 192 stores in Europe, 12 stores in Russia, 48 stores in North America, but only 12 stores in China & Japan. (Source: financial year 2009 of IKEA) From the first IKEA store opened in China in 1998 to now, IKEA only open 8 stores in 10 years. The speed is much slower than other foreign furniture companies like British B which already had 38 stores in China. The strategy of IKEA is low price, but the China is already became the world factory and the logo â€Å"made in China† is became to the syn onymous with low price.After read some thesis and report about IKEA written by Chinese scholar, I find the price is too high to Chinese people because of the exchange rate. The concept of IKEA is providing most people low price furniture to help them have a better life at home, but most Chinese people cannot afford the price now. So I think IKEA must be in a dilemma in China. Then I wrote a these named â€Å"the dilemma of IKEA in China and ‘made in China’†. I wanted to analysis the situation of IKEA and suggest IKEA increase the number of purchasing from China to reduce the cost of goods. 3 When I discussed with my professor Lars Steiner, he have a different opinion. He asked me maybe IKEA do not want let most Chinese people afford the price, and maybe IKEA just want China to be a good purchasing base. That question really puzzled me a long time. Indeed, IKEA could treat China as a good purchasing base. Because the situation of China market is special, the chang e to adapt the China market may affect the global strategy of IKEA, even affect the earning performance. Data observed, experienced or recorded closest to the event, are the nearest one can get to the truth, distortions inevitably occur as the proximity to the event decreases† (Walliman,2005) So I want to have an interview with the manager of IKEA to get the further understanding. Because I want to research the China market of IKEA, I wrote e-mail to the customer service of IKEA store in Beijing and Shanghai. They replied me that thank me write the letter to them; they already send my e-mail to the manager and let me wait the reply of manager.After two month waiting, I received nothing. So I have to give up. After that, I try to write e-mail to the customer service of IKEA store in Gavle. Similarly, they replied me that thank me write the letter to them and let me to wait for the reply. Fortunately, Hans Karlsson which is the logics manager of IKEA store in Gavle told me I can get a chance to have an interview with him and he is very glad to help me. So I hurried to prepared the interview questions and get suggestions from my professor Lars Steiner.We meet each other in staff office of Gavle IKEA store on 2010-05-21. The first sentence of Mr. Karlsson is very sorry he cannot tell me too much data about IKEA because IKEA is not a public company. He introduced the history of IKEA, the concept of IKEA, the competitive strategy of logistics which is the most important way to keep the low price, the strategy of market segmentation, the situation of IKEA in China, explaining some good examples according to the model of competitive advantage, analyzing the next step which IKEA will do to adapt the problem of China market.IKEA is a world famous company and an example of success, but there are not too much theses and books to research IKEA, especially about IKEA in China market. Even I have a further understanding about IKEA though this interview, I still think i t is not enough to explain the situation of IKEA in China. Because Mr. karlsson is the manager of IKEA and China market is not one part of his job, he maybe just tell me the good side of IKEA and the opinion about China market is too one-sided. I think I also should refer to other people’s opinions which have suggestions to IKEA and deeper understanding of China market.That will be having a complete understanding about IKEA in China. So I ask help to my friend Guanying Liu which is studying the master of international economics in Shenzhen University. Unfortunately, she does not know too much about IKEA, but she provided me some theses and reports from the data library of her university. I collected the data, opinions and suggestions from these materials. After that, I found even these materials is not too much, I can get a general idea about the situation, the problem and the suggestions of IKEA in China.That make me have a more complete knowledge about the questions I want to research. 14 After the data-gathering process, I read the â€Å"The Five Competitive Forces that Shape Strategy† and â€Å"Competitive advantage† written by Michael Porter who is one of the most influential management experts in the world today. These theories in these books are very good tools to help a company to get the competitive advantage to extending volume growth. I use these theories in these books to analysis these data I collected. I find the success of IKEA is not got by lucky.The model of IKEA is a very good example to improve Michael Porter’s theories. These methods of IKEA used could learn by other companies, especially these Chinese companies which are still at an early stage. 4. Findings In this chapter, I will introduce the findings from the web, the history of IKEA, the information from interview. 4. 1. The introduction of IKEA Figure 3(http://cache. gizmodo. com/assets/images/gizmodo/2008/08/ikea. jpg) IKEA is one of the world famous furni ture companies. It was founded in 1943. As a 15 and which is one of Sweden band which have good unique style and brand image, IKEA band constantly strives to provide customers with the furniture which is pyretic, beautiful and practical, people can afford the household articles for use. 4. 2. The history of IKEA from the web of IKEA The IKEA story begins in 1926 when founder Ingvar Kamprad is born in Smaland in southern Sweden. He is raised on ‘Elmtaryd', a farm near the small village of Agunnaryd. Even as a young boy Ingvar knows he wants to develop a business. 4. 2. 1. 920 At the age of five Ingvar Kamprad starts selling matches to his nearby neighbors and by the time he is seven, he starts selling further afield, using his bicycle. He finds that he can buy matches in bulk cheaply in Stockholm and re-sell them individually at a very low price but still make a good profit. From matches he expands to selling flower seeds, greeting cards, Christmas tree decorations, and later p encils and ball-point pens. 4. 2. 2. 1940s-1950s The root of a furniture dealer Ingvar Kamprad is entrepreneurial in developing IKEA into a furniture retailer.This period sees the exploration of furniture design, self assembly, advertising, the use of a catalog and a showroom to reach the many people. Table 1: 1940s-1950s In 1951 IKEA founder sees the opportunity to sell furniture on a larger scale using a catalog. The IKEA catalog that we know today is born. In 1953 Furniture showroom opens in Almhult, Sweden, This is an important moment in the development of the IKEA concept – for the first time customers can see and touch IKEA home furnishings before ordering them. The innovation is a success; people wisely choose the products with the best value for money.In 1955 They start to think about the flat package 16 4. 2. 3. 1960s-1970s The IKEA concept starts to take shape. Table 2:1960s-1970 In 1960 The first IKEA restaurant opens in the IKEA store in Almhult, Sweden. In 1961 I KEA begins quality testing its products using Swedish testing standards. In 1962 Marian Grabinski designs the MTP bookcase. Developing this and other wooden products develops strong relationships between IKEA and Polish suppliers during the 1960s. These relationships continue today and are an important reason for IKEA maintaining low prices so that the many people can afford them.In 1965 The store's success leads to the opening of a self-serve warehouse – an important part of the IKEA concept is born. Additionally, Accenten is opened, where customers can buy quality cooking items at a low price. In 1976 Ingvar Kamprad writes The Testament of a Furniture Dealer and in 1976 it is published – it documents IKEA's vision and business idea and has a strong influence on the development and vitality of IKEA's culture. 4. 2. 4. 1980s IKEA expands dramatically into new markets such as USA, Italy, France and the UK. More IKEA classics arrive such as KLIPPAN, LACK and MOMENT.IKEA begins to take the form of today's modern IKEA. Table 3:1980s In 1982 The IKEA Group is formed and its owner is a foundation, the Stitchting INGKA Foundation, which is based in the Netherlands. In 1984 IKEA FAMILY, the new customer club, is launched. Today, IKEA FAMILY is in 16 countries (over 167 stores) and has about 15 million members. The IKEA catalog print run expands to 45 million copies, in nine languages. In 1985 IKEA now has 10,000 co-workers and 60 stores in the IKEA Group. 4. 2. 5. 1990s IKEA grows even more. Children's IKEA is introduced and the focus is on home 17 urnishing solutions to meet the needs of families with children. The IKEA Group is formed and responsibility for people and the environment is seen as a prerequisite for doing good business. Table 4: 1990s In 1991 IKEA acquires its own sawmills and production plants and establishes the industrial group Swedwood to produce wood-based furniture and wooden components. In 1997 Children's IKEA is launched. IKEA dec ides to develop a range specifically for children. In 1998 IKEA arrives in China. The first IKEA store opens in Shanghai. In 1999 The IKEA group grows to 50,000 co-workers and has 158 stores in 29 countries.On IKEA have the Big Thank You event. The total of all sales on this special October day, worldwide, is divided among all co-workers – in total about 84. 85 9, 1999 million Euros. It is a great way to thank hard-working IKEA co-workers for contributing to the company's ongoing success. 4. 2. 6. 2000s IKEA expands into even more markets such as Japan and Russia. Everything for the bedroom and kitchen is explored and presented in co-ordinate furnishing solutions. This period also sees the successes of several partnerships regarding social and environmental projects.Table 5:2000s In 2000 The code of conduct called The IKEA Way on Purchasing Home Furnishing Products (IWAY) is launched. It defines what suppliers can expect from IKEA and specifies what IKEA expects from its supp liers in terms of legal requirements, working conditions, active prevention of child labor, external environment and forestry management. In addition to this, IKEA also introduces The IKEA Way on Preventing Child Labor to ensure that no child labor is used by suppliers or their sub-contractors. Child rights project in India. E-shopping is launched in Sweden and Denmark.Since then many other markets have started offering online shopping at IKEA. In 2001 The IKEA Group trials running its own rail operations through IKEA Rail AB. The use of rail continues to be an important part of the IKEA strategy to promote sustainable transportation of IKEA material and products. A new product-recovery concept is implemented in more than 100 IKEA stores in Europe to ensure that returned products are, where possible, 18 In 2002 In 2005 In 2006 repaired instead of being wasted. Everything for the bedroom under one roof.IKEA customers help children in need The IKEA Group exceeds 100,000 co-workers and operates in 44 countries. 4. 3. The data from the web of IKEA The IKEA opened 15 new stores at 2008 and in august 2009 had 267 stores, which welcomed a total of 590 million visitors during the year. A further 34 stores are owned and run by franchisees outside the IKEA group. IKEA group sales totaled 21. 5 billion Euros. IKEA food services reported sales of 1. 03 billion Euros. The IKEA group had 31 trading service offices in 26 countries, and 28 distribution centres and 11 customer distribution centres in 16 countries.The swedwood group, the IKEA industrial group had 15,000 co-workers and 46 production units. (source: IKEA at a glance- financial year 2009) Table 6: the top 5 selling and supplier countries IKEA Germany The United States (10%) China (22% ) Poland (16% ) Italy (8%) Sweden (6 % ) Germany ( 6% ) Britain ( 9% ) France (9% ) Sweden ( 7% ) selling TOP (16%) 5 countries IKEA TOP 5 supplier countries (http://www. cnstock. com/paper_new//html/2007-07/20/content_57549571. htm) 4. 4. The information from interview In this chapter, I will introduce the information from the interview with Mr. Karlsson on 2010-05-21 at Gavle IKEA store. . 4. 1. The logics process of IKEA Mr. Karlsson introduced the logics process of IKEA. The following pictures show the process. There are four main parts in the logics process: supplier (factory), distribution centre (warehouse), store, the customer. 19 Supplier (factory): IKEA focus their force to the design. At this step, they consider the low price when they design new product. And then IKEA try to find the supplier all over the world according to many factor like the geographic position, the price, the quality and so on. Distribution centre (warehouse): IKEA has 28 distribution centres in 16 countries.These distribution centres use the same computer system. They collect the information about the sales volume of every product, the quantity of inventory, and so on. The distribution centre control the goods between factory a nd store, even sometime they package the goods which from different factories. The distribution centre also is the warehouse of this area. For example, the distribution centre in shanghai is the biggest distribution centre in Asia. They always gather the goods from all over the world to here. And then they send the different number of goods to every store in Asia according to the sales volume.The high efficiency of logics is the biggest strategy is a good way to keep the low price. Store: there are two part of IKEA store: open hall and warehouse. In the display hall, customer can get the complete information about the product. Through the open hall, IKEA show its function of products, quality and low price to customer furniture with the three-dimensional way. After the customer decided the product they want to buy, they can go to the warehouse to take the unopened product. There are not too much shop assistants in the store, which is a good way to reduce the operating expenses of st ore and keep the low price.Customer: after the customer brought the goods, they transport the goods by themselves. That is a way to reduce the cost of transport and keep the low price. There are 3 ways which IKEA used in logics process: 1, the DC delivery Figure 4: the DC delivery process In this process, they transport the goods from the factory to the distribution centre all over the world. Then according the condition of demand, they transport the goods to different stores. After the customers buy goods from the store, the store collect the information and send the information to the distribution centre.After analysis the information, IKEA send the new order to the factory. That is a loop. This way is the most common way IKEA used now. 2, the transit delivery 20 Figure 5: the transit delivery process Sometime, the goods are not produced by one factory. These goods need produced different parts by more than two factories and maybe these factories are in different countries. At thi s situation, they transport all parts of the goods from these factories to the distribution centre. They package these parts to a complete one in the distribution centre and then transport the goods to the store.The rest logics process is same like the normal way. 3, the direct delivery Figure 6: the direct delivery process This way is a special and high efficiency way. In this process, the goods do not need to transport to the distribution centre. The goods are directly delivered to the stores. So, they can save the cost of one time transport. And also this way can increase the use ratio of the warehouse. Mr. Karlsson told me this way of direct delivery is less than 50% in the total logics process and IKEA wish to increase the rate of this way to reduce the cost of transport.Actually, there are so many kinds of goods in IKEA and there are so many suppliers 21 and stores in all over the world. The process of logics is much more complicated than these pictures. 4. 4. 2. The market se gment The target customer of IKEA is everybody. So the market segment is a very important part of IKEA strategy. After visited the IKEA store, I think the market segment of IKEA is the different part of house, like the kitchen, the bedroom, the bathroom. Actually, the market segment is according to the â€Å"life situation†. The life situation creates the need of the home furniture.IKEA do not select the customer, IKEA just select the offer from the life situation. For example, I am a student. I need the bookshelf, desk and I do not need the kitchen because I do not live in my own place now. But after 10 years, the need of life situation will change. I will need other things. The most important point is that I am always the target customer even in different ages. And IKEA always provide customers the things they need. I think that is a good method that IKEA used to service the customers and win the hearts of the customers. Even there are so many products in IKEA.Not all of th e stores have the same goods. According to the local situation, IKEA adjust the goods in IKEA store. For example, there are not too much students in Gavel, so there will be less products for students than other IKEA store like the IKEA store in Stockholm or Linkoping. That is a good way to increase the use ratio of the store and the warehouse, and also minimize the cargo backlog. 4. 4. 3. The logistics strategy all over the world When I start to research the IKEA, I have a question whether the goods in IKEA store are the same price.So I compare the price of the same kind of good on the web of IKEA store in different countries. I found the price is almost the same. So I thought IKEA use the same logistics strategy all over the world. The exchange rate between RMB with Euro is the biggest reason that Chinese customer cannot afford the price of IKEA goods. But Mr. Karlsson told me that the logistics strategy of IKEA have difference between different country. The price of goods is decid ed by the cost of all of the process. The different place has the different cost, just like the big deal of McDonald, it will changed by different request of customer. . 4. 4. The China market Mr. Karlsson thinks the China market is huge potential. At the moment and in the future, IKEA will find more business opportunities include the supplier and the 22 market. IKEA is always changing. So the situation of IKEA in China will be better. For the question â€Å"do you think increase the purchasing quantity in China can reduce the cost and increase the competitive advantage? † Mr. Karlsson has the different opinion: he thinks the price is decided by the cost in the total produce and transport process.With the development of the China economy, China market seems not the cheapest place any more. 4. 4. 5. The next step that IKEA can do to increase the competitive advantage especially in logistics Mr. Karlsson think IKEA will continue to use and work with the concept of IKEA. There s till have many places they can do to increase the competitive advantage, like increase the direct delivery, use more train and so on. 4. 4. 6. The competitor of IKEA Mr. Karlsson thinks the IKEA is already an international company and IKEA is growing. So at the present time, the competitor of IKEA is not the international competitor.With the development of IKEA, the competitor of IKEA is the local competitor. Sometimes, the local competitors copy the good idea or counterfeit the goods of IKEA. To this situation, the important way IKEA used is the low price. IKEA get the lower price though the large-scale procurement. Low price, good quality, knight service and new design methodology or technology help IKEA occupied the market quickly. 4. 4. 7. The uniform of IKEA When I have the interview with Mr. Karlsson, I noticed that everybody ware the same uniform in the office.So you cannot distinguish who is the manager and who is the normal employee. And Mr. Karlsson told me IKEA not only s ervice the customer but also provide a comfortable environment for their employees. 4. 5. The compare with the competitor of IKEA After I research the data from the internet, I get a form about the competitor of IKEA 23 Table 7 The foreign furniture company Sweden IKEA British â€Å"B&Q† American Home Depot The time and the place of the first The number of store store in China now 1998 shanghai 8 1999 shanghai 50 At the end of 2006 successfully 12 purchased 12 stores in China. . 6. The situation of IKEA in China at this stage This chapter is to introduce some Chinese scholars’ opinions about the situation of IKEA. Chinese scholars could understand China market more clearly. So, I think their opinions could let me get deeper understand about IKEA in China at this stage. 4. 6. 1. The reason of the price problem There are 3 reasons that make the concept of IKEA change: a, the competitive advantage of low price is not clear and the price is always too high to customer. B, the challenge of high exchange rate make IKEA cannot have the same price in global.C, IKEA seems have the strategy of the high-grade brand positioning in China. (Sa Wang and Licheng zhang, 2008) 4. 6. 2. The substance of the IKEA dilemma in China The substance of the IKEA dilemma in China is which one is more important between localization and standardization. One side, IKEA use the standardization to run the China market. On the other side, IKEA the strategy of IKEA in China does not give full consideration to standardization. That makes strategy of IKEA do not have a good effect in China market. (Xiaofei Zhao, 2005) 4. 6. 3.The reason that the speed of IKEA develop slower than the competitor The IKEA stores in China are just the image shops. From 1998 to 2005, IKEA open 2 stores in China. These stores are used to collect the information and cultivate customer spending habits. From 2005 to now, IKEA enters to the acceleration stage. IKEA is developing in its own rhythm. (Chunhua He , 2009) 24 4. 6. 4. The challenge and the innovation of IKEA in China The challenge: A, IKEA is the â€Å"later comer†. Compared with other competitor, the speed of development is later. B, IKEA is the â€Å"Mr. Misunderstanding†.Because of the high price, the paradise of wage earners becomes to the place of high income bracket. C, IKEA is the â€Å"outcomer†. The Chinese customers still do not adapt the management style of Northern Europe. The innovation: A, IKEA changes the place of store from suburbs to prosperous areas. B, increase the number of service staffs C, increase the way of advertising (Benshun Cui 2003) 4. 6. 5. The disadvantage of IKEA in China A, do not provide the free transport service and free install service B, IKEA always buy land and build the store by them. This way is not only need a long time but also need too much money. Xiaofei Zhao, 2005) 4. 6. 6. The model of IKEA The model of IKEA could be generalized as a whole: one core, two strat egies, three marketing, and four fulcrums One core: insist on â€Å"Recreational Shopping† Two strategies: a, low price b, the model of chain operating Three marketing: a, transparent promotion b, Catalog c, one-stop shop for marketing Four fulcrums: a, cost control b, brand control c, management control d, and image control (Daqian Li, 2005) 5. Discussion 5. 1. The competitive advantage model of IKEA After the long time research, there is so much knowledge about IKEA.From the web, the interview, and especially follow the history of IKEA, we can find many methods which IKEA used to improve the competitive advantage. According to the theory of â€Å"competitive advantage†, I summarize these methods in to the table 8. 25 Table 8: the competitive advantage model of IKEA The five competitive The methods IKEA used forces that determine industry profitability Bargaining power of 1, looking for the suppliers from all over the world suppliers 2, cooperating with more than one suppliers 3,†IWAY† defines what suppliers can expect from IKEA and specifies what IKEA requires from its suppliers.Bargaining power of 1, low price customers 2,good quality 3, good service 4, high quality of design 5, wide varieties Threat of new 1, â€Å"Catalog† is a good way to advertise entrants 2, the scale effect 3, high-efficiently of logics 4, develop new products Threat of substitute A special team develops new products, updating technology, products promoting technological development Competitive rivalry 1, using the scale effect to get the low price 2, improving the public image within an industry 3, the model of chain operating 5. 2.The three ways used to increase the competitive advantage As a world famous furniture company, the secret of success behind IKEA is the strategy. 5. 2. 1. Overall cost leadership The strategy of overall cost leadership is always the IKEA’s biggest aim. We can find the history of IKEA is also the history of looking fo r low price. We can find IKEA try to find the low price at every part of the process. For example, before they design a product, they already confirm the price. They use â€Å"flat-package† to reduce the cost of transport. They reduce the staff in store to reduce the cost of store.They also use the scale effect to purchase goods from all over the world. 26 5. 2. 2. Differentiation Today's IKEA range consists of 9,500 home furnishing articles, designed to be functional and good looking but at a low price. You can find almost everything you need in IKEA. Both romantics and liberals can find the style they like. Customers need the goods low price and good quality. Low price or good quality is easy to achieve, but it is not easy to get both of them. At start, IKEA chose a different way which is stand on the side of everybody. IKEA also take children to their customer, and the spirit f care for children really wins many customers’ heart. IKEA also does a good job in environ ment protection. 5. 2. 3. Focus There are three main part of IKEA: IKEA office, home storage, Children’s IKEA. The target customer is everybody. According to the â€Å"life system†, they segment the market to many parts. That will be better meet the requirement of different customers. Especially the new design for child, it helps IKEA win many hearts from the customers. 5. 2. 4. Pursuit of more than one generic strategy Even these 3 strategies are interacting and affect to each other, IKEA use these strategies flexibly.That is the reason that IKEA can get much more competitive advantage than other competitors. A, cost leadership and differentiation Differentiation always needs the extra cost, and cost leadership always need company forego some differentiation by standardizing its product. The method IKEA used to solve this problem is design the price tag before design the product. They can seek the differentiation inside the price tag. The â€Å"flat-package† an d â€Å"self-assembly† not only save the cost of transport but also give the designer more room to seek the differentiation.B, cost leadership and focus If a firm services too much segment markets, it will not get the profitability of focus. IKEA use the â€Å"life system† to find out what the customer really need at different age. The people at different age need different furniture. After the segment though â€Å"life system†, the designer could understand the need of customer. So the designer could design the product which is low price and useful to the customer. This method not only segment markets very well but also can focus the resource to the cost leadership. It makes sure everything they produced is useful to people.After the research of the 27 local situation, IKEA could find out the need of local customers and change the goods in IKEA store. That could improve the use ratio of store and prevent the waste of transport. 5. 3. The suggestion for IKEA in China According to different situation, IKEA should change the strategy flexibly. 5. 3. 1. The advertisement The normal way IKEA used to advertise is the â€Å"Catalog†. If IKEA wants to get a good effect in China, IKEA should not only use the â€Å"catalog†. Because of the number population in China IKEA will find out the â€Å"Catalog† may spend a lot of money in the future.Because there are still a little stores in China, IKEA still a new name in China. If IKEA wants to open more stores in new city, IKEA should take the advertisement to the city before the store opened. 5. 3. 2. The company culture IKEA is already 60 years in Sweden. The customer already understands the company culture and the model of IKEA. Even IKEA already entered China about 11 years, Chinese customers still do not understand the model and company culture of IKEA. In the shadow of the high price, the concept which wants to improve the quality of life seems like an empty talk. IKEA need ti me to achieve the concept in China.But if the customer do not trust and support IKEA, the future of IKEA will not look good. So, the mission of IKEA right now is to advertise the spirit of IKEA to customer. Only after get the trust of customer, IKEA could have a better future in China. 5. 3. 3. The cooperation of local supplier There are 3 logics process that IKEA used. In the future, IKEA should increase the direct delivery to get more competitive advantage of cost leadership. Because China is a developing country, every technology and environmental awareness is still not complete. If IKEA want to find more cooperators in China, IKEA could provide more help to the cooperator.So IKEA can get more cooperation with the suppliers which fit the requirement of â€Å"IWAY†. Only increase the number of purchasing in China and get the scale effect, IKEA could achieve the aim that everybody can afford. 28 5. 3. 4. The environment-friendly products IKEA is a company which focuses on th e environmental protection. In China, the environmental awareness of people is not good as the Sweden people. Sometime, people will not choose the environment-friendly products because they think these products must be more expensive than normal product. If IKEA add the advantage of technology