ISP530 - CaseStudy ( Ikea ).docx - UNIVERSITI TEKNOLOGI...

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UNIVERSITI TEKNOLOGI MARA CAWANGAN SELANGOR KAMPUS SHAH ALAM 54000 KUALA LUMPUR FACULTY OF COMPUTER AND MATHEMATICAL SCIENCES Fakulti Sains Komputer dan Matematik ISP 530 INTRODUCTION TO DIGITAL BUSINESS CASE STUDY FOR IKEA’S COMPANY NAME MATRICS CARD USAID BUKHARI BIN SULAIMAN 2020976867 UMMI BALQIS BINTI MUSA 2020975443 MUHAMMAD ZULKIFLI BIN ZAINI 2020982339 RYSHMANOVA KARINA 2020747325 GROUP : CS2643A FOR : PROFESSOR MADYA KALSOM BINTI NASIR 1 | P a g e
CONTENTS 1. Chapter 1: Organization Profile 3-7 2. Chapter 2: Digital Business Implementation 2.1: Brief description of history and establishment of the digital business 2.2: Major operations involved with digital business 2.3: Benefits from digital business implementation 2.4: Challenged experienced 8-10 3. Chapter 3: Digital Business Analysis 3.1: Description of the Business Models for the digital business 3.2: Description of the Revenue Models for the digital business 3.3: Description of digital business strategy analysis 3.4: Description of digital business supply chain management and e- procurement 11-19 4. Conclusion 20 5. References / Appendix 21 2 | P a g e
CHAPTER 1 ORGANIZATION PROFILE 1.1 IKEA 1.1.1 History and establishment IKEA is a European multinational group that designs and sells ready-to-assemble furniture kitchen such as beds and desks, appliances and home accessories. The company is the world’s largest furniture retailer. Founded in 1943 by 17-year-old Ingvar Kamprad in Sweden. He took the first letters of his name and his hometown to make the name of IKEA. As of June 2019, there are 433 IKEA stores opening in 52 countries. By 1958, the first IKEA store became an expanded establishment at the Almhult. The initial concept behind the store was to have a spot where customers could come to see furniture set up by IKEA. Kamprad experimented with adding restaurant to the store so that when shopping, customers could relax and refresh. The restaurant was successful and all IKEA stores became an important feature. IKEA opened their first store in Sweden in 1965. Most of IKEA’s stores and factories are owned by INGKA. INGKA is a holding company controlled by the Stitching INGKA Foundation, one of the 40 wealthiest foundations in the world. The INGKA Foundation is controlled by five-member executive committee that is chaired by Kamprad and includes his wife and attorney. Although most IKEA stores operate under the direct control of INGKA Holding and the INGKA Foundation, the brand and idea of IKEA is held by a completely different Netherlands company, Inter IKEA Systems. Growing IKEA shop, including those owned by INGKA Holding, charges Inter IKEA Systems a franchise fee of 3% of sales. Nearly 70% of the stores located in Europe. INGKA received 90% of IKEA’s revenue in 2018. The best countries for IKEA are Germany with 15% of sales and the United States with 14% of sales. The retailer added 19 stores last year, including its first store in India in Hyderabad. Ikea received 957 million store visits in 2018 and 2.5 billion to Ikea.com. It offers roughly 9,500 products. IKEA’s supply chain management is one its solid sources of competitive advantage. IKEA has 1046 suppliers in 52 countries and 32 3 | P a g e
distribution centres in 16 countries. These resources are important to ensure capability to meet

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