IKEA’s Workforce Management and Strategy

1. Introduction

1.1 Background of the study

In the recent globalisation era, there is high competition in the labour market and it is necessary to manage strong employee base for better performance of the organisation, so that the efficient employees can perform better and satisfy their customers as well as contribute positively for gaining high market share (Berman et al., 2019). Hereby, the employees are playing an important role in running the firms in the market and thus it is the major responsibility of the organisational leader to manage them properly at the workplace. The staff members are the major stakeholders of the organisation, who play a crucial role in managing their business operations and contribute positively to achieve long run organisational success (Armstrong and Taylor, 2020). Organisational leader and management team must encourage and create values for the employees to retain them for long run at the organisational workplace. Through restructuring the organisational corporate strategy and developing Human Resource (HR) practice, it is possible for the leaders to maximise the wellbeing of the people, engaged in the organisation. In the retail sector, there is high competition across the globe and IKEA is facing high competitive threats in running their business successfully (Bailey et al., 2018). It is essential for the company to attract diverse workforce for managing their internal operations as the firm is efficient to expand their business international and run their operations successfully. In the recent competitive era and globalisation, it is the responsibility of the CEO of IKEA and the board members to develop effective corporate strategy and design HR practice for managing the diverse workforce and retain them successfully (DeCenzo, Robbins and Verhulst, 2016). IKEA is a Swedish origin multinational group selling ready to assemble furniture, kitchen appliances and hoe accessories in the market. The organisation is successful to create newly design and high quality furniture and home appliances that are beneficial for the organisation to target the customers across the international countries. Number of locations that the company serve is 433 operating across 52 countries in the year of 2019 and here are more than 211000 employees, who can manage the customers by delivering high quality products and efficient services. The organisation is also efficient to generate €41.3 billion revenue in the previous year and it is successful to secure future sustainable development by managing their business operations efficiently (IKEA, 2020).

1.2 Problem statement

Recent globalisation era increases migration rate across the international borders, where the labourer are migrating from one country to another for better working opportunities and ensuring future professional growth (Bratton and Gold, 2017). The multinational corporate firms face several issues to handle the diverse workforce in long run due to cultural diversity and lack of corporate strategic planning. In this regard, the major issues in human resource management are lack of management of employee morale, cultural diversity at the workplace, and ethics, lack of cooperation, as well as poor communication, inequality and lack of fairness at the workplace lack of management of transparency and accountability, which further deteriorate the organisational performance, as the managers fail to create values for the employees (Ciobanu, Androniceanu and Lazaroiu, 2019). There are monetary and non-monetary incentives at the workplace through which the organisational leader aims at creating values for them and improving their interest to work where it is also necessary to develop corporate strategic planning for achieving future organisational success.

1.3 Aims and objectives of the research

The aim of the research is to identify the corporate strategic planning and HR practice at the organisation IKEA, and analyse the impacts of proper strategic planning of HR on the business of the firm. The objectives of the research are such as,

To Identify different human resource management functions at the workplace for enhancing organisational performance

To acknowledge the ways International organisation design their HR Strategy to align with their Corporate strategy

To analyse the impacts of organisational corporate strategies and HR policies on the performance of the employees

To develop proper recommendations for the organisations to restructure their strategy for motivating he expatriates and enhancing their performance in long run

1.4 Research questions

What are the different human resource management functions at the workplace for enhancing organisational performance

How does International organisation design their HR Strategy to align with their corporate strategy?

What are the suggested recommendations for the organisations to restructure their strategy for motivating he expatriates and enhancing their performance in long run

2. Literature review

2.1 Corporate strategy of the multinational companies

The multinational corporations try to develop the corporate strategy in order to fulfil its vision and mission, so that the organisational values can be maximised well in long run. In order to gain high competitive advantage, the organisational corporate strategy needs to be developed well and in this regard, the strategies are such as,

Reallocating the organisational resources

Marketing strategic planning

Operation management

Customer service management

These are the major strategies of the firms to be sustainable in the market and gain high market share. The companies try to develop product portfolio and in this regard product diversification strategy is mandatory on which the firms can maintain a strong portfolio with availability of the diversify products and services at the organisation. Cost leadership strategy is also applied by the multinational companies to reduce the cost of operations and production and generate profitability (Ansoff et al., 2018). Additionally resource reallocation is another mandatory strategy where the firms try to reallocate the resources for improving economies of scale to manage the production and distribution. The firms are facing issues related to managing their operational efficiency due to poor communication, lack of supply chain management and poor distribution network and it is mandatory for the firm to develop effective strategic planning to sustain in the competitive market. Operational strategic planning is also another important tactic to run the organisation successfully in the market and in this regard the business focus on strengthening their supply chain, improving Information system management through technological innovation and implementation, retaining efficient distributors, and managing warehouse for product stock management. In this regard, the organisations in the recent years face the issue of low market share and lack of competitive advantage due to intense competition which may deteriorate the firm’s performance and in this regard, market expansion strategy is important tactic of the companies to expand the business and gain high competitive advantage in long run and in this regard the marketing strategic planning and customer’s service management are the major practice through which the brands can establish their business efficiently (Lasserre, 2017).

2.2 Aligning HR strategies

For identifying the HR strategic planning, it is necessary to evaluate the human resource management functions, through which it is possible to understand the organisational tactics to create values for the employees at the workplace. The functions of staffing policy through recruitment and selection method, motivating, managing change, maintaining relationship with each employee at the workplace and evaluating and appraising are effective to manage strong employee base (Sparrow, Brewster and Chung, 2016).

The HR managers try to create values for the employees by providing monetary incentives and non-monetary rewards a well as developing suitable organisational culture, so that the staff members can work under the suitable working condition. In this regard, motivational theories are also effective to identify the best HR practice at the multinational corporations.

As per the Maslow’s hierarchy of needs there are some different needs including psychological, safety, love and belongingness, self actualisation and self esteem (Bratton and Gold, 2017). The leader and organisational manager aim at fulfilling the basic needs through providing monetary support and structured salary (Marchington et al., 2016). Safety and security of the employees are also maintained through organisational policy of data privacy, insurance coverage for any accidental incidents at the workplace and providing safe workplace. Love and belongingness are also managed well where the leader aims at developing strong bonding to engage the staff members in the organisational activities. Self actualisation and the needs to self esteem are also managed by the leader through giving sense of achievement, responsibility and appreciation (Ciobanu, Androniceanu and Lazaroiu, 2019). Additionally, there is Herzberg’s theory of motivation which also aligns the HR policies and practice at the workplace. There are two factors, hygienic and motivations. Under hygienic factors, the leaders and HR managers focus on managing co-worker relationship, developing proper working condition, implementing employment policies, maximising supervisor quality and wages (Nankervis et al., 2019).

In order to mitigate the human resource management issues such as lack of employment program, poor induction training, lack of appraisal program, poor motivational activities and lack of suitable organisational culture, it is necessary for the organisation to develop effective tactics to manage their strong employee base. The leaders in this context aim at motivating the employees through achievement and recognition at the workplace, developing working culture, advancement and personal growth, and work. The mangers try to create values by respect and integrity as well as managing transparency and accountability, where the leaders aim at strengthening their employee base and retain them for long run.

2.3 Impacts of HR practice and corporate strategies

There are different impacts of appropriate corporate strategic planning and HR practices at the workplace, which are,

Enhancing the organisational performance

Retaining experienced staff for long run

Encouraging employee’s creativity Maintaining employee morale

Fulfilling the organisational commitment towards each staff

Boosting the interest of the employees to perform better

Improving contribution of the staff

Creating values for them (Nankervis et al., 2019)

Managing cultural diversity at the workplace

Enhancing organisational innovation

3. Methodology

In order to understand the research methodology, it is possible to review the research onion which provides clear understanding about the research methods, where the researcher will be able to choose the right research method successfully to complete the study efficiently.

3.1 research philosophy

As per the research philosophy, there are three types which are positivism, interpretivism and realism. As per the interpretivism, the researcher is able to conduct research by in-depth analysis, where the people are not involved properly, as it is effective for conducting qualitative research. On the other hand, realism is the philosophy to conduct the analysis on the basis of real life example. Positivism philosophy is when the people are engaged and the researcher aims at gathering public reviews and perception of the individuals in the research for better analysis and evaluation. In this regard, the researcher will choose the positivism philosophy, in order to conduct the research by involving the people. Valid data collection and in-depth analysis could be done through the positivism philosophy.

3.2 Research approach

There are two types of research approach, one of inductive and other is deductive. The inductive approach is where the researcher identifies the data and information ad analyse it fir creating he models and theories related to the research. It is an inverse method, where the researcher tries to develop the theories and models after analysing the data and collected information. On the other hand, deductive approach is related to gathering the right information data by reviewing the models and theories by gathering the literature sources (Quinlan et al., 2019). Apart from that, the researcher will try to improve own knowledge and understanding to analyse the gathered information by applying the theories and models related to the research. In this particular research, the researcher will choose the deductive approach to identify and analyse the data information. The researcher will be able to collect the data and analyse it efficiently through the deductive approach.

3.3 Data collection method

Data collection methods are of two types, one is primary and other is secondary. The primary data collection is mainly the collection of first hand data and information directly from the participants, where the respondents share their feedback and perception over a particular topic. On the other hand, the secondary data collection method is effective to gather secondary data through reviewing the secondary sources of information such as books, journals, online articles, website, company financial report, business letters and newspapers, which are appropriate sources to gather a vast range of information for the research (Quinlan et al., 2019). The researcher in this regard will choose both the primary and secondary data collection method in order to conduct the analysis after collecting the relevant and valid data, where the primary data provides a scope to the researcher to empower the organisational representative of IKEA and gather their feedback for analysing the above mentioned research topic.

3.4 Data analysis technique

The data analysis technique includes quantitative and qualitative. The quantitative data analysis is related to the process of analysing the collected data and information through charts, graphs, and statistical tools such as SPSS (Johnston, 2017). On the other hand, the qualitative data analysis is related to evaluating the collected information by utilising the secondary sources of information. It is applicable for analysing the interview data. In this research, the researcher will chose the qualitative data analysis method, for better analysis and evaluation of the gathered information in which the researcher will be able to apply the collected secondary sources of information, theories and models for better analysis of the above mentioned research topic. The interview transcript is collected through primary data collection and it will be analysed and evaluated through secondary data analysis technique by applying the existing theories of HR and corporate strategic management ion the business context.

3.5 Sampling

Sampling is necessary for the researcher to develop proper understanding about inclusion of the participants, who are able to provide appropriate answers to the interview questions. In this regard, random sampling is applied where the researcher will include 5 managers of IKEA to analyse the corporate strategy and HR practices at the organisation, where the management team is successful to strengthen their employee base. The managers include 3 HR managers in the HR department, 1 manager from production and manufacturing department and 1 manager from the sales department. The random sampling is selected to choose the managers in the main branch of the organisation IKEA.

4. Ethical considers

During the study, the researcher will manage transparency and accountability in conducting the research successfully. Respecting all the respondents and managing integrity during the interview process by involving the managers of IKEA will be beneficial further for the researcher to collect relevant data and information and analyse it successfully for fulfilling the above mentioned research objectives. Additionally, Data relevancy and validity should be maintained in the study to manage ethics and complete it successfully by including the right information and authentic data related to the research. Moreover, the researcher executives the Data Protection Act 1998 and ensures that all the collected data and information will be used only for this study and analysis purpose (Baker et al., 2016). The researcher also will try to convince the participants to attend the interview rather than forcing them to participate, so that the respondents can be respected and valued during the interview process. Hereby, audio and video recording of interview would be collected and the researcher will ensure there will be no face-to-face interview due to the issue of spread of COVID-19.

5. Limitations

The major .limitations of the research is time constraint, lack of access of journals and cost constraint. Due to lack of time, it is difficult for the researcher to conduct the analysis to fulfil the research objectors. The researcher also is suffering through difficulties to conduct in depth analysis for better evaluation due to time constraint. The researcher will also face problems to access the online journal sites, which are required for gathering a vast range of information related to HR planning and corporate strategies in the multinational corporate firms. It is necessary for the researcher to review the existing sources of information including journals, articles, online newspapers and business letters to have proper understanding about the researcher topic. However, due to lack of access of the online journal sites and absence of having credentials of the privately protected online sources, the researcher will face difficulties to manage data gathering and further data analysis. On the other hand, the primary data collection method is another effective tactics to analyse the above mentioned research topic, but due to cost constraint, the researcher will face problem to conduct the survey by including the employees, who are playing crucial role in the organisation.

Reference List

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