Two Distinctive HR Aspects Identified in IKEA - Case Study Example

IKEA Table of Contents Table of Contents 2 Introduction 3 Discussion 4 Two distinctive HR aspects identified in IKEA 4 How the HR aspects are affected by the Crisis of IKEA? 5 Analysis of the HRM practices with the help of theories and evidences of IKEA 8 Conclusion 11 References 12 Introduction In this age of extreme competition, human resource management (HRM) strategies and policies act as the catalyst for the growth of an organization. This is because; it is the HRM policies that help an organization to manage and control its human resources in an effective way. If the HRM policies and strategies are designed as per the requirements or demands of the human resources, then their inner morale and confidence might get enhanced. By enhancement of the inner morale, the level of motivation and dedication of the employees towards their work gets increased. As a result, their level of performance and productivity might get improved that may amplify the brand image and reputation of the organization in the market as compared to many other rival players. Only then, the organization might amplify its competitive advantage and sustainability in long run. However, the concept of HRM is offered high attention by the organization of IKEA so as to enhance its productivity and demand in numerous new markets such as China, Europe and many others. The prime intension behind this motive is to enhance the inner confidence and satisfaction of the employees to present inventive product lines in order to cope up the changing demands of the customers. Apart from this HRM policies and strategies are offered high concentration in order to make the employees accustomed with different cultural norms and ideas in different countries (IKEA Group sustainable strategy, 2020). This essay describes two different HR aspects that took place within the organization of IKEA and the ways by which these HR aspects are affected due to crisis. Along with this, it also describes the implications of wider HRM practices with the help of theories like Hofstede cultural model and Hertzberg two factor and Vroom expectancy theory. Discussion Two distinctive HR aspects identified in IKEA In order to amplify the brand image and dominance of the brand, every organization desires to expand itself in numerous new markets. Only then, the level of awareness and profitability of the organization might get enhanced that may amplify its productivity. Similarly, the organization of IKEA also tried to penetrate into the foreign markets such as China, Europe and many others. However, in order to enhance its demand and portfolio, the organization of IKEA tried to offer high concentration over the product strategy. This is done, in order to attract a wide range of high-profile customers towards the brand by offering inventive designs and eye-catching styles of square table, centre tables, chairs etc. However, in order to offer to present, high-designed products, the organization of IKEA tried to offer varied types of craftsmanship training programs (Inter IKEA Systems B.V. 2012). These types of training programs are implemented in order to amplify the inner skills and talents of the employees. As a result, the level of dedication and motivation of the employees towards their assigned tasks might get enhanced that may increase their productivity and efficiency. Due to the improvement of the inner skills, the level of performance of the employees might get increased that may amplify the brand image and competitive position of the organization in the market among other rival players. Moreover, in order to increase the product lines of the organization, IKEA might try to recruit numerous experienced and skilled staffs. By recruiting these staffs, the organization of IKEA became successful in satisfying varied types of inventive products lines that enhanced its equity and distinctiveness (Harzing & van Ruysseveldt, 2004, pp. 567-578). Furthermore, the organization of IKEA also tried to maintain a participative leadership style, in which every employee is free to present their ideas and views. In this type of leadership style, the leader or the CEO also presented the positive impacts of diverse workforce as IKEA penetrated varied foreign markets such as China, Europe and many others. Such type of mutual discussions takes place only to present the advantages of multicultural workforce in order to operate successfully in the above mentioned foreign markets. Such type of discussions are organised in order to improve the level of awareness and knowledge of the employees towards the concept of diverse workforce that may reduce its negative effects. Thus, if the organizational management become successful in managing a uniform workforce, then it may surely amplify its portfolio and distinctiveness in the foreign market among others (Dowling & et.al. 2008, pp. 523-534). Hence, it might be depicted that, development of a uniform culture and retention of skilled or experienced workforces might be possible only if the HRM policies are designed according to the requirements of the employees. Only then, the portfolio and prosperity of the organization of IKEA might get amplified thereby amplifying its demand and competitive position in the market among others contenders. Moreover, due to improvement of the demand of the products, the organization might easily cope up with any sort of business challenges or threats. Thus, HRM policies act as the corner stone to improve the brand value and popularity of an organization in this age of high competitive rivalry (IKEA Group sustainable strategy, 2020). How the HR aspects are affected by the Crisis of IKEA? The organization of IKEA expanded its roots into the markets of China and Europe, in order to amplify its competitive advantage and profitability. However, the market share and popularity of the organization of IKEA might get enhanced only if it became successful to offer inventive product lines. But to prepare such types of designed products, highly experienced employees need to be recruited of varying cultures. Multicultural workforces within an organization might create varied types of internal disputes as presented by Hofstede cultural model. As per Hofstede model, the Chinese employees always try to offer high preference or concentration to the dominant individual as compared to Swedish employees. This is mainly due to dimensional difference within the citizens of two countries such as Sweden and China. Due to which, power is not centrally distributed among the employees of the organization of IKEA. This means, the experienced and talented individual comprise of high power and authority as compared to the low skilled employees. Such type of distinctions due to power and authority, interpersonal conflicts might take place within the employees that may reduce their confidence and dedication power. As a result, the level of motivation might get reduced that may decline the level of productivity and profitability. Similarly, the citizens of Sweden desire to offer high level of concentration over individual family members rather than society as a whole. On the other hand, the Chinese citizens or employees desire to offer high level of concentration over collectivism. Due to such type of differences, the level of coordination and cooperation among the employees may not take place that may reduce their inner morale and performance. As a result, the rate of profitability and efficiency of the organization of IKEA might get disturbed that may hinder its growth and market share significantly among others. Moreover, the Chinese employees, desired to offer high value for masculinity as compared to Swedish employees. As a result, the female members of the organization are not offered equal respect and authority by the Chinese employees that create an interpersonal conflict among them. Due to which, the rate of coordination and communication among the members reduces significantly that may hinder their portfolio and prosperity of the organization of IKEA in the market among others. Such type of interpersonal conflicts might enhance the rate of attritions that may decline the retention ratio. Furthermore as the Chinese employees offer high values of pragmatism as compared to Swedish employees, so the Chinese employees always try to undergo vivid planning. This is done, in order to reduce the threat of unknown risks to a considerable extent. However, on the other hand, the Swedish employees do not believe in the concept of planning. As a result, the Swedish employees had to cope up with varied types of business challenges and feel the taste of failure. However, maximum extent of the Swedish employees desires to help others in their work in order to accomplish the task efficiently. On the other hand, the Chinese employees do not try to present any sort of help to the other employees and due to which, the rate of coordination among the Swedish and Chinese employees may not prove worthy for the organization of IKEA. However, in order amplify the level of coordination and communication among the employees of Sweden and China effectively, the leader or CEO might try to maintain an interpersonal relationship with all its employees. By doing so, any sort of interpersonal disputes might be easily reduced that may enhance their coordination and communication. Moreover, implementation of good interpersonal relationship, the rate of motivation and confidence might get enhanced that may improve their performance and efficiency. Other than this, due to proper coordination, the organization of IKEA might become successful in developing varied types of inventive products and services that may increase its productivity and profitability in foreign markets. Hofstede model showing Sweden and China (Source: Hofstede, 2014) Moreover, due to proper coordination and communication among the employees of varying cultures and creeds, the level of knowledge and talents might get enhanced that may prove effective for the individual in future era. Hence, it might be clearly stated that proper acceptance of all employees of varying cultures and creeds, may prove effective in amplifying the competitive position and reliability of the organization in the market among others (Dicken, 2011, pp. 256-267). Therefore, it may be depicted that equal respect and power need to be offered to all employees, irrespective of cultural variation or creed. Analysis of the HRM practices with the help of theories and evidences of IKEA The HRM practices play an active role in fulfilling the inner desires and dreams of an individual in an effective way. Only, by doing so, an organization might retain or attract skilled and experienced workforces that may prove effective in inventing varied types of designed products. By doing so, the organization might become capable to satisfy the changing needs of the customers thereby amplifying their reliability and dependency over the brand of IKEA. Therefore, it might be stated that, the level of motivation and dedication of the employees might be enhanced only if their primary, secondary and tertiary needs get fulfilled (Briscoe & Schuler, 2008, pp. 423-434). As per Hertzberg’s two factor theory, motivation or dedication of an individual towards his or her assigned duties or tasks might get enhanced only if the basic needs get fulfilled (Davidson & et. al. 2011, pp. 734-754). For example: if an individual or an employee is satisfied with the hygiene factors like work safety, fridge benefits, salary, attitude, behaviour of the colleagues etc, then he or she might surely get motivated towards higher performance or devotion. However, in case, the employees get dissatisfied by the behaviours or attitudes of the co-members, then their level of confidence might get lowered. As a result, the employee may not offer full dedication towards his duties and might not prove effective for the organization. Similarly, if the employees fail to maintain proper coordination and cooperation among themselves due to cultural diversity, then the organization of IKEA may not develop inventive products. As a result, the organization may not become able to enhance its image and position in foreign markets of China and Europe. As a result, the rate of profitability and productivity of the organization of IKEA might get reduced to a considerable extent. Thus, it might be revealed that HRM policies are directly related with the improvement of the organizational net income and total sales (Beardwell & et.al. 2004, pp. 323-334). Furthermore, due to the implementation of effective HRM policies, the rate of retention of the experienced staffs also increased that proved extremely effective for the organization in future age. This is because; retention of experienced staffs enhanced the inner skills and talents of the other employees that improved their performance and commitment towards the assigned goals. Hence, the brand value and market share of the organization of IKEA increased by a significant extent as compared to its competing players (Boxall & Purcell, 2007, pp. 245-256). Other than, Hertzberg’s two factor theory, Vroom expectancy theory also states that the employees might get motivated towards the work, only if their performance leads to results. This means, the employees might get motivated to offer high level of devotion or commitment only if they are aware about the outcomes or rewards such as money benefits, promotions, recognitions etc. This is called expectancy. However, after becoming aware about the rewards, the employees might get motivated towards the assigned tasks at any sort of conditions. This is called instrumentality (Davidson & et. al. 2011, pp. 723-734). The last element of this theory is valence. If the employee feels that the rewards offered by the management are effective for him or her, then the employee might show better efforts. Similarly, the CEO of IKEA, Mr. Peter Agnefjäll implemented varied types of reward systems in order to amplify the motivation and dedication of the employees towards the work. By implementing such type of HRM policies, the employees became highly devoted towards their duties and tasks that amplified both organizational as well as individual performance. As a result, the organization of IKEA became successful in amplifying its brand image and prosperity in the foreign market among other rival players. Other than this, in order to improve the inner skills and talents of the existing employees Mr. Agnefjäll implemented varied types of training and developmental programs. These programs helped in enhancing their level of knowledge and technical skills that may prove effective for them in future age (Bartlett & Ghoshal, 2008, pp. 223-234). However, due to the presence of such type of assistance by the management of the organization, the level of expectation of the employees might get enhanced that may reduce the rate of attritions. As a result, the organization of IKEA might attain varied types of assistances from the experienced employees such as presenting valuable ideas and suggestion for the improvement of the organizational portfolio and many others. Moreover, if the employees get satisfied with the sort of HRM policies implemented by the management of the organization of IKEA, then the level of interpersonal conflicts and clashes might get reduced that may increase their commitment towards the assigned tasks. As a result, the efficiency and functioning of the organization might also get enhanced thereby amplifying its competitive advantage and portfolio in the foreign markets as well (Bamber & et.al. 2011, pp. 123-134). Hence, it might be clearly depicted that the improvement of an organization is entirely dependent over its HRM policies or strategies. If the HRM strategies are not implemented in an appropriate way, then the motivation and confidence of the employees may not be enhanced. However, if the organizational employees lack their confidence and devotion power, then their performance level might get declined. Due to declined performance of the employees, the brand image and equity of the organization might also get reduced day by day among others. Conclusion Conclusively, it might be stated that, an organization might improve its competitiveness and sustainability only if its human resources are satisfied and contended with its HRM policies. This is because; human resource is the prime pillar of an organization, without which it may not prosper in future age. Moreover, it is the human resources of an organization that help sin development of varied types of inventive products and services, thereby amplifying its productivity and net income as compared to others. Hence, it might be depicted that, in order to achieve a dominant position in the market, an organization might try to maintain its human resources satisfied and contended. Only then, it might tackle all sorts of business challenges and upcoming threats in an effective way thereby amplifying its opportunities and inner strengths. 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