IKEA if the company really care about them and

IKEA is a world-famous furniture manufacturer and retailer, reputed for selling minimalism-style furnitures and other home related goods. IKEA has over 260 stores, with operations carried out in over 45 countries and more than 70,000 employees1. The stores themselves can host over 400 million customers every year. This company was founded in Sweden in the year of 1943, built on the idea of selling a wide range of well-designed, functional home furnishing products with affordable prices, based on which most of people can buy them. The IKEA group is now owned by the INGKA Foundation through a holding company, but unlisted on the stock market.  Since 2008, IKEA had became the world’s largest furniture manufacturer and retailer. It’s great success in business is believed to be due to it superior business strategy. Including production operation strategies, “maze”store design, “do-it-yourself” product strategy, remarkable inventory method etc.1.1 IKEA’s human resource and work culture.IKEA’s vision is “to create a better everyday life for many people”. The ‘People’ here means not just customers, but also their employees, and the community. The company’s human resource philosophy follows the belief that the staff will be more productive and efficient if the company really care about them and listen to what they think2. As many other Swedish companies did, IKEA used a paternalistic stance toward employees and their needs and encourage employee empowerment.However, although the company had a smarter HR concept and offered great benefits, their application was more or less standardized and policies applied uniformly to all employees. And, this did not always work well, as different employees had different needs. In the late 1990s, Spiers-Lopez became the leader of the human resource department at IKEA of North America branch. Soon she realized that employees were not able to derive the maximum benefit from IKEA’s human resource policies, because the policies did not always match everyone’s situations and needs2. She believed that employees would benefit more if there were a greater amount of flexibility in benefits administration. Thus, sheperformed comprehensive surveys on her employees, asking them questions about what they need, requirements and preferences. She concluded that, although almost all of IKEA’s staff  believed in, and were committed to the IKEA concept and culture,  indeed everyone had different requirements and expectations to the company. In order to accommodate these different needs, she proposed some initiatives that supported life balance and diversity.Her positive human resource policies were backed by IKEA’S company culture – encouraging diversity and innovation. She also believed that IKEA’s culture was characterized by a family-like culture, which makes relationships among the company’s  employees strong and open.As she said, “In IKEA, we regard each other as a family. We even look after each other’s parents, siblings or kids, and our colleagues’ family is strongly encouraged to support and take care of each other” .Kamprad, the founder of IKEA, believed that “the true IKEA spirit is still founded on our enthusiasm, on our constant will to renew, on our cost consciousness, on our willingness to assume responsibility and to help, on our humbleness before the task and on the simplicity in our behavior. We must take care of each other, inspire each other.”3…Obviously, IKEA’s great HR strategy involved substantial costs to the company. Sometimes they even seemed to be the antithesis of the company’s cost conscious culture. Nevertheless, the payoff of this HR policy far outweighed their costs. For instance, in 2001, IKEA’s employee turnover was 76% , but then dramatically fell to 56% in 2002 and 35% in 2003. The company’s turnover was also almost half the average  rate of funituing industry, (around 60%). This finally lowered the company’s costs in recruiting and training replacements.