Case Studies Operations - term 1 year 12

IKEA cost leadership strategy

IKEA aims to price products 20-50% below competitors through vertical integration, flat-pack design, automation and high-volume production, reducing operational costs.

IKEA flat-pack design

Reduces transport, storage and labour costs and allows customers to take goods home immediately, improving speed, convenience and affordability.

IKEA differentiation strategy

Ready-to-assemble furniture, in-store experience, self-serve warehouse access and optional paid assembly/picking services.

IKEA sustainable inputs

IKEA monitors sustainability and safety of inputs, using FSC-certified timber and avoiding harmful materials like lead crystal in glasses.

IKEA HR approach

IKEA fosters low hierarchy, flexible work systems and collaborative teams to strengthen staff involvement in operations.

IKEA scheduling (Kronos)

IKEA uses Kronos automated scheduling software to analyse trading data, labour availability and demand patterns to optimise staffing.

IKEA leading edge technology

IKEA uses patented technologies like plastic 'loading ledges' and 100% automated factories to increase efficiency and reduce labour cost.

IKEA customer service

IKEA offers a self-directed shopping experience with showrooms, self-serve warehouses and instructional videos to support customer independence.

IKEA sustainability strategy

IKEA's 'People and Planet Positive' initiative promotes closed-loop resource cycles, renewable materials and global sustainability sourcing.

IKEA CSR example

IKEA complies with EU timber sourcing laws and uses FSC-certified wood to meet ethical and environmental expectations beyond legal minimums.

IKEA quality management

IKEA applies TQM with supplier audits, testing labs (fire, climate, strength tests) and strict ISQS supplier standards.

IKEA cost objective

IKEA uses efficient processes like Chemical Leasing and automation to reduce per-unit cost, achieving annual global price reductions (2-3% each year).

IKEA dependability

Vertically integrated supply chain and strategically located distribution centres near ports.

IKEA flexibility

Decentralisation increases agility, allowing IKEA to focus on core retail while outsourcing logistics to specialist subsidiaries.

IKEA global sourcing

IKEA sources inputs from low-cost countries (e.g. China, Poland, India) to reduce labour and procurement costs.

Costco logistics example

Costco built a $77 million distribution hub in Western Sydney to increase logistics efficiency, reduce transport time and support expansion.

Apple standardised goods

Apple mass-produces iPhones using standardised assembly lines with high precision and low variety.

Apple customised goods

Apple allows customisation for products like Apple Watches (bands, colours) and service options like AppleCare.

Apple warranties

Apple provides a 1-year complementary warranty and optional paid insurance, strengthening dependability and service quality.

Telstra leading edge technology

Telstra invests in 5G rollout in 35 cities, showing innovation in operations processes and service delivery.

Qantas outsourcing

Qantas outsources aircraft maintenance (e.g., 747 checks in Hong Kong) to cut costs and access specialist expertise.

Woolworths FIFO

Woolworths uses FIFO for perishables to reduce spoilage, maintain freshness and meet quality expectations.

IKEA JIT inventory

IKEA uses JIT inventory and SKU labels to minimise holding costs and reduce 'cost-per-touch' in warehouses.

Westpac CSR

Westpac sets sustainability goals such as 40% women in senior roles, reduced emissions, and social disadvantage initiatives.