ikea talent management case study

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Unlocking skills and growth: how ikea is empowering its workers.

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Ulrika Biesèrt, the chief human resources officer and global people and culture manager at Ingka ... [+] Group, the parent to Swedish furniture company IKEA

Employee engagement in the United States is dropping. A recent survey by McKinsey & Company reveals that worker engagement fell to 32% , down 3% from the prior year. While these individuals fulfill the basic job requirements, they do just the bare minimum. Factors that lead to disengagement include feeling undervalued, poor work-life balance and a toxic workplace culture.

In a conversation with Ulrika Biesèrt, the chief human resources officer and global people and culture manager at Ingka Group, the largest IKEA retailer, the executive shared how she looks after her 170,000 workers in more than 31 countries.

Biesèrt is committed to strengthening workers’ employability at Ingka through lifelong learning, development and reskilling. The CHRO emphasizes employee values, kindness, collaboration and prioritizing mental health and emotional wellbeing.

Values Are As Important As Performance

Employees, specifically in the tech sector, dread being subjected to a performance improvement plan, fearing they’ll be pushed out the door. In stark contrast, at IKEA, performance evaluation is equally weighted, with a 50% focus on the business KPIs, deliverables and performance goals and 50% on values and leadership.

Leadership expectations at the company cover the following topics:

• “I communicate with impact.”
• “I communicate in an inclusive and straightforward way.”
• “I act with honesty and transparency and show my vulnerability in dialogue with others.”
• “I lead by example.”
• “I live our IKEA values while performing in our business as what we do and how we do it is equally important.”

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“We ground our work in our vision and values, striving to take responsibility and take care of people,” Biesèrt said.

IKEA has several initiatives to support its workers' mental health and emotional wellbeing. The international retailer offers flexible wellness days to its employees and has a “co-worker experience manager” tasked with fostering a great workplace for employees to facilitate a great customer experience. This entails focusing on areas such as health and wellbeing, employment practices and reward structures.

Looking After Workers

The company champions the concept that everyone is a learner, has talent and can lead, referring to this movement as “leadership by all,” in which the organization empowers individuals to help lead the business together.

Employees are encouraged to share their career goals and take ownership of their development. For example, an IKEA employee can meet with their manager and openly state, “I want to become a team leader. What do I need to do to achieve that?” Nearly 90% of the company’s managers were hired from within , according to Alejandra Piñol, who is responsible for talent at Ingka Group.

Piñol said about the company’s inclusive leadership initiatives, “We want to encourage each of us to lead, to feel trusted and take decisions, so that, in turn, we better serve our customers.” She added, “Giving everyone the opportunity to lead allows for real entrepreneurship, which is in the DNA of IKEA.”

The company has a program in which staff at all levels try new assignments to gain new skills and a sense of appreciation for the jobs being carried out by colleagues. If you pop into an IKEA store one day, you may see Biesèrt or Piñol onsite doing manual tasks.

Deploying AI to Help Managers And Increase Retention

In an evolving business landscape, the company must contend with trends like digitization, automation, e-commerce, diversifying workforce models and changes in traditional retailing.

“These changes mean that life-long learning and innovation are prerequisites, and our future needs are about unlocking skills and driving growth,” said Biesèrt. To meet the demands of the future, IKEA is leveraging artificial intelligence to improve its operations and enhance the customer experience.

Biesèrt is focused on upskilling and reskilling workers for resilience in the age of AI. For instance, the company uses AI to transform call center employees into interior design advisors.

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• Support managers with automated retention analysis customized for their team
• Help pinpoint the employees in most need of attention and suggest topics to address
• Keep track of agreed actions
• Enables follow-up that managers take their responsibility to act on employee turnover

The deployment of AI to help increase retention has been rolled out to 122 stores in six countries, with more coming. The results from the first three countries showed an improvement of voluntary turnover by 2.7%.

Managers will conduct a probability analysis using data, such as time in their position, salary, schedules and more, to determine who is at high risk for voluntary turnover. Armed with this valuable insight, supervisors can initiate a dialogue with the employees regarding their work life.

For example, if the data shows that hours worked is the most significant contributing factor to an employee potentially voluntarily separating from the company, the manager can touch base with the employee and inquire if everything is okay and whether they feel they are working too much and any adjustments are needed. This practice also holds managers accountable for making the necessary improvements to ensure employee retention, engagement and happiness.

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IKEA: Hiring on Values As Well as Skills

Instead of looking just at job-related skills and experience when deciding who to hire, culture-focused companies such as IKEA “expanded their selection criteria to include cultural fit,” assessing applicants’ personalities and values, according to new research.

• Talent Management

IKEA’s standard job questionnaire downplays skills, experience or academic credentials, focusing instead on applicants’ values and beliefs.

Image courtesy of Flickr user 5thLuna .

Many successful companies, such as IKEA, consider corporate culture part of their competitive edge.

For those companies, that means hiring in a different way.

Culture-focused companies “make deliberate efforts to integrate their stated core values and business principles into talent management processes such as hiring methods, leadership development activities, performance management systems, and compensation and benefits programs” says the article “Six Principles of Effective Global Talent Management,” in the current issue of MIT Sloan Management Review .

Instead of looking just at job-related skills and experience when deciding who to hire, culture-focused companies “expanded their selection criteria to include cultural fit,” assessing applicants’ personalities and values. The assumption is that “skills are easier to develop than personality traits, attitudes and values,” says the article, which is based on a multiyear collaborative research project.

Case in point: IKEA, the Sweden-based furniture retailer:

• IKEA’s standard job questionnaire downplays skills, experience or academic credentials, says the article.
• The questionnaire asks about job applicants’ values and beliefs.
• Comments about values and beliefs become the basis for screening, interviewing, and training and development.
• When IKEA employees apply internally for new jobs or leadership positions, “the main focus is once again on values in an effort to ensure consistency.”

“The range of talent management issues facing multinational companies today is extremely broad,” write the authors Günter K. Stahl, Ingmar Björkman, Elaine Farndale, Shad S. Morris, Jaap Paauwe, Philip Stiles, Jonathan Trevor and Patrick Wright.

Their research highlights the six key principles successful companies adhere to for effective global talent management. “Cultural embeddedness” like what IKEA demonstrates in its hiring practices is one of those principles. The other five are: alignment with strategy; internal consistency; management involvement; a balance of global and local needs; and employer branding through differentiation.

For more about IKEA, see “The Experimental Roots of Revolutionary Vision” from the MIT SMR archives. It’s a 2006 profile of the history of the company by Jérôme Barthélemy.

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How IKEA maintains culture for 170,000 global employees

Ulrika Biesèrt oversees a lot of employees—over 170,000 globally.

She’s head of people and culture at IKEA Retail (also known as Ingka Group), which manages 390 of IKEA’s 464 retail stores worldwide, and generates 90% of IKEA’s revenue.

As the pandemic threw countless businesses into disarray, and confined millions of people worldwide to their homes, IKEA’s furniture and decor businesses boomed, and a third of sales moved swiftly online.

The changes meant hiring more staff, training them, and retraining vast numbers of current employees to do new things—like help customers with design ideas over the phone or internet.

IKEA prides itself on having a strong company culture. But with so many people to manage globally, many of them new hires, and a constantly evolving strategy, it’s easier said than done.

Just last week, for example, IKEA announced it will no longer pay full sick pay for unvaccinated UK workers who need to self-isolate due to Covid. In response to an inquiry from Quartz, Ingka Group said it “believes that the vaccine is an important step in the global effort to tackle COVID-19.” It clarified that unvaccinated UK workers with mitigating circumstances such as pregnancy or underlying health conditions would continue to get full sick pay if they had to isolate, but those with none would only receive the standard sick pay mandated under UK law.

Biesèrt spoke to Quartz about how she and her distributed team are doubling down on company culture to help whether the storm of the pandemic.

This conversation has been condensed and edited for clarity.  

Quartz: What has been your approach to sustaining company culture for thousands of employees during a pandemic, when dealing with issues ranging from illness and caregiving to onboarding new hires?

Ulrika Biesért: Culture and values are at the core of who we are, and also who we want to be. That started with the founder [Ingvar Kamprad] a long, long time ago. We are also quite pragmatic. We’re focused on something we call “recruitment through values.” So even in the hiring process we put time into understanding a co-worker’s personality, values, attitudes, and we try to find people who fit our culture. Who you are is as important as your capabilities. More companies are saying this now, but I think this was quite groundbreaking when we began it.

I always say we are simple, down to earth, straightforward people who like to get the job done. So it’s less about hierarchy or official position. When we look at people, we measure not just what you do, but also how you do it, and that’s equally important.

If I’m a leader that is super good at delivering business objectives, but I’m not treating my co-workers well, then I’m not performing as a leader. Keeping culture aligned through 32 markets, we have to be very firm and have a clear point of view on our behaviors and ways of working.

I notice you used the term “co-workers” instead of workers or employees…

I’ve been at the company for 22 years, and we have always talked about co-workers. It’s very deeply rooted. [The term has been used at IKEA since at least 1985.]

How can you be sure that the cultural policies you try to create in Sweden are helpful and valuable for, say, a warehouse worker in Jakarta?

We regularly do anonymous co-worker surveys. Currently 83% of our co-workers rate us as a great place to work. But it’s not a perfect world, so sometimes we see, specifically in leadership, bad behaviors [like not treating others well]. And there, we act quite boldly. First, by supporting the leader to address the issue. But if that doesn’t work, it’s not the right fit. And then we need to have another discussion.

We try to create a culture where people are not so afraid of making mistakes, but also not afraid to speak up. If you feel that we are not living the culture, the first level is that you go to your line manager or the HR person in that local unit. We also have a crisis line, so you can anonymously make complaints. And then of course there is a hierarchy, and you can go the whole way up. But most of it is handled on a country level.

How has your business been affected by the pandemic?

A crisis shows who you are as a company, and we decided directly—and this is something I’m proud of—to side with our co-workers. So we have supported them, I would say, quite heavily. We decided to safeguard all pay for co-workers who needed to be home with the children. [This was a short-term measure in the early pandemic and IKEA now deals with the issue of supporting parents differently in different places.]

When you take care of your co-workers, they take care of customers. In all, 93% of our co-workers said they felt very supported by us during the pandemic, which is a lovely result I think.

Many companies are trying to hone their business to mitigate major problems like climate, while also being more fair and purposeful places to work. What is IKEA’s position on this as an expanding consumer goods company? 

Our vision is to create a better life for many. And that vision puts quite a bit of responsibility, on us. But it also presents opportunities. We have decided to become more affordable, more accessible, but also more “people and planet positive.” Irresponsible consumption is an old model that will not work in the future. We believe that the new business model must be integrated with a sustainability agenda. So for instance, our mattresses and kitchen products now have 25 years of warranty.

And no company can avoid the equality agenda for the future. Twenty years ago, we saw that we didn’t have women in leading positions, and decided to change it. Today, we have more than 50% women throughout our organization in managerial positions. We have worked very heavily with inclusion. In India, we are not only offering maternity leave, we are offering paternity leave as well. In Japan, we now offer the same benefits for partners of the same sex. We know we are not yet there. But we want to reflect the customer and society base, so this is our next commitment. I think you need to combine profit and purpose now. And that we are totally committed to.

What do your employees, or co-workers, do to push you more in these areas?

The sustainability agenda is among the top five reasons people choose to work for us. In interviews, the question of sustainability always comes up. And equality comes up.

We are trying to also be quite action-oriented and pragmatic. Now 92% of our co-workers have gone through our sustainability training, where we think about how you can live a more sustainable life as a human being, and what we’re doing as a company to contribute to a better world.

We are doing quite a lot of work on refugees. As of today, we have supported 775 refugees in 21 countries to get skills and language training [most of whom then got jobs at Ingka Group]. In 2022, we are committed to working with another 2,500 refugees and asylum seekers.

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Talent Management: How IKEA’s HR makes everyone grow

IKEA is on its way to becoming one of the top options for recent graduates. A refined Talent Management at the furniture chain recruits and develops its co-workers based on a strong belief that they will grow.

Talent Management at IKEA

IKEA’s vision is clear: To create a better everyday life for the many people. They produce furniture to the lowest price possible so that even people with a small wallet can afford their products.

This also plays a big role in their design process. Before a designer at IKEA starts planning, he or she is given the end price for the consumer. Only then he can start thinking efficiently, and moreover, practically.

IKEA’s Human Resource Idea is designed to create the highest value for their customer. Everyone at the company is seen as a Co-worker, and not as an employee. Everyone is perceived as a talent and enjoys great support from management.

The Swedish furniture-chain came a long way to where it is now. Ingvar Kamprad founded his business in 1943 and started off by selling pens and postcards from a bike in a small town in Sweden. After he realised the huge demand in furniture, he extended his business model and opened his first store in 1948. And even the location of the very first IKEA was way back in the countryside, Kamprad managed to grow his company exponentially, so Nathan Oterdoom (IKEA HR Advisor) and David Hoogland (IKEA team manager) in Groningen, Holland.

Today there are 400 Stores in 49 countries, with 183.000 workers. Until now, IKEA is not listed in the Stockmarket and is therefore not dependent on external investors. The international furniture company only grows when they can afford the investment. In addition to that: in case a country is underperforming, others will have to save money in order to help stabilising the weakest link.

One more interesting fact about IKEA before going back to their human resource practices: IKEA puts great emphasis on its sustainability. That is why IKEA has its own forests in Poland ind Russia – the goal is to become self-sufficient by 2050.

Every company is only as strong as its workforce. Also, IKEA knows that their human capital is the most important one, which is why the Talent Management at IKEA attracts more and more students withhigh-classs degrees around the world.

The biggest share of employees at IKEA is working in the Customer Care Centre. Here, everyone performing 40 meetings a day, 9 minutes each. Without agenda co-workers at IKEA will be recorded and judged on a monthly basis. And apparently, they like it.

They should, because IKEA receives 619.335 Phone Calls, 106.786 Emails, and 124.601 social media requests every year.

IKEA has a very compelling Talent Approach towards their employees. First of all, everyone at IKEA is seen as a talent. The recruitment team selects applicants carefully according to their values and thus, try to spot and identify talent. Once a member of the IKEA Team, there a many different ways one can grow.

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Inside IKEA’s Digital Transformation

• Thomas Stackpole

A Q&A with Barbara Martin Coppola, IKEA Retail’s chief digital officer.

How does going digital change a legacy retail brand? According to Barbara Martin Coppola, CDO at IKEA Retail, it’s a challenge of remaining fundamentally the same company while doing almost everything differently. In this Q&A, Martin Coppola talks about how working in tech for 20 years prepared her for this challenge, why giving customers control over their data is good business, and how to stay focused on the core mission when you’re changing everything else.

What does it mean for one of the world’s most recognizable retail brands to go digital? For almost 80 years, IKEA has been in the very analogue business of selling its distinct brand of home goods to people. Three years ago, IKEA Retail (Ingka Group) hired Barbara Martin Coppola — a veteran of Google, Samsung, and Texas Instruments — to guide the company through a digital transformation and help it enter the next era of its history. HBR spoke with Martin Coppola about the particular challenge of transformation at a legacy company, how to sustain your culture when you’re changing almost everything, and how her 20 years in the tech industry prepared her for this task.

• Thomas Stackpole is a senior editor at Harvard Business Review.

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IKEA U.S. takes equity, diversity and inclusion to the next level

Furniture retailer builds ambitious new strategies into its business plan.

5-MINUTE READ

Call for change

A responsibility to build a better society.

For many years, the world’s largest furniture retailer, IKEA, has prioritized efforts to promote equity, diversity and inclusion (ED&I). For example, the company has partnered with social entrepreneurs, creating thousands of jobs for under-represented groups around the world, including a project with Syrian refugees to develop textile products for sale in IKEA stores. Additionally, through employee development and human resources programs across the globe, IKEA has successfully increased the percentage of women in leadership positions,  reaching 50% in 2020 .

Even with its existing achievements in ED&I, IKEA wanted to do more.

IKEA U.S. asked Accenture to help assess its current state of ED&I, define an ED&I vision, and develop a comprehensive plan to accelerate gains in this area. The aim was to implement an effective approach that the company could replicate in other countries. IKEA U.S. was particularly interested in setting and pursuing race and ethnicity goals as well as increasing the diversity of its leadership.

With increasing inequality due to climate change and other global challenges, we recognized that we have a responsibility to help build a society that provides equal opportunities for all.

STEPHANI “STEVIE” LEWIS / Chief Diversity Officer, IKEA U.S.

When tech meets human ingenuity

Improving maturity in ed&i.

We used our maturity model to characterize the current state of ED&I at IKEA U.S. This model measures the extent to which ED&I is embedded in a company in specific areas and identifies opportunities for improvement.

The team inputted the results of several activities into the model:

• Interviews with IKEA U.S. departments:  For instance, interviews with communications staff focused on understanding how ED&I values are embedded into the communication strategy.
• A survey of executives at IKEA U.S.  gathering insights into the current state of ED&I and their aspirations for the company.
• Focus groups with IKEA U.S. co-workers  to explore their experiences working at IKEA and gather their perspectives on the company’s ED&I maturity.

Using the model’s results and additional research on ED&I at eight other retailers, Accenture compared the ED&I maturity of IKEA U.S. with that group. We also compared human resources data for IKEA U.S. employees with U.S. Census data in various geographic areas, revealing the diversity gap between IKEA and local Census populations.

A valuable difference

A roadmap for greater equality.

We presented the results from our maturity assessment in a facilitated workshop with the IKEA U.S. ED&I staff and leadership team. The participants translated the results into a vision to guide action and several ED&I strategies, such as increasing underrepresented groups at all levels of the organization. They also developed 30 recommendations to be integrated into the 2023 business plan for IKEA U.S., such as determining ED&I performance indicators.

Since Accenture completed the project, the ED&I team has asked leaders at each U.S. store to implement ED&I initiatives that support the new vision and strategies while serving specific store needs. These include an Equity Council, an accountability group led by CEO Javier Quiñones, and a pilot program to support diverse talent with leadership training and mentorship. IKEA U.S. has also built a dashboard that tracks ED&I indicators at stores, allowing for progress reports to be shared with executives.

“We now have the data and the tools to take ED&I to the next level,” said Lewis.

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CASE STUDY | RETAIL

Performance Management Coaching

Embedding a coaching culture at ikea with coaching training.

IKEA embarked on a journey to harness its unique corporate culture and management style to drive business performance. To do this they needed to equip their managers with performance management coaching skills to complement the existing management style and expand the portfolio of management and leadership skills.

“Having been involved in many aspects of training within IKEA at all levels over the past 10 years, the coaching programme facilitated by Performance Consultants was miles ahead of any in-house programme relating to coaching that I have been involved with and the business results speak for themselves.” Phil Rogers, UK Top Talent Development Director, IKEA

As the world’s largest furniture retailer, IKEA is a multinational company developing solutions that influence the lives and future of millions. The IKEA culture and values reflect the entrepreneurial spirit of its founder Ingvar Kamprad and are essential to its global success.

The 8 IKEA key values are togetherness, caring for people and planet, cost-consciousness, simplicity, renew and improve, different with a meaning, give and take responsibility, lead by example.

The Challenge

IKEA wanted to drive business performance by strengthening management and leadership skills.

They were looking to:

• Up-skill and establish a solid management and leadership style
• Improve performance
• Complement the IKEA culture and values

They needed a performance management coaching course that would embed a coaching culture based on IKEA’s values and improve on the previously low take-up and effectiveness of their in-house management and leadership development trainings.

“We believe that every individual has something valuable to offer and we strive to have the same values in the way we work.” IKEA

Our Approach

Performance Consultants designed and delivered an accredited train-the-trainer performance management coaching programme to 750 managers and supervisors in the UK.

This included:

• Interactive foundation seminar:  To inspire the team and to share the vision of what could be created by adopting a values-based performance management and leadership approach. This really lit the imagination of the top team and created the optimal momentum and placement for the rest of the project. Simultaneously, IKEA’s training to date and HR material were revized and updated.
• Developing coaching skills:  The train the trainer coaching programme included modules from our existing  Coaching for Performance  training programme which aligned with the International Coaching Federation (ICF) – the industry gold standard for people who want to lead and manage in a coaching style. These modules were customized to suit IKEA’s business and training needs.
• Certification  ⎯ internal pool of managers and supervisors accredited to deliver the training.
• Sustaining the learning  ⎯ internal coaching champions were identified to keep the training momentum and practical application going.
• After the success of a pilot study for 80 managers and supervisors, we delivered an in-house roll-out to 750 managers in the UK.

“Coaching is the enabler and a coaching culture creates the conditions for high performance.” Sir John Whitmore, coaching pioneer

The Results

All participants passed their assessment (some requiring additional support and training) and became accredited. They are now delivering 2-day Performance Management Coaching courses in branches all over the country and training new in-house trainers.

Departments whose managers attended performance management coaching training:

• Saw a 5% KPI increase (4% is considered significant)
• Went from 60% scores in management ability to 90% scores across the board
• One department went from 3rd worst performer to top performer

As a result of the programme, Performance Consultants have:

• Generated extremely high internal motivation and enthusiasm for the coaching training among participants and their teams
• Received consistently great feedback praising the approach and coaching training delivered
• Collected great stories of how the coaching training has impacted the business, reduced costs and improved creativity

Reflections with Sir John Whitmore

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IKEA Organizational Culture: simplicity, teamwork and diversity

IKEA organizational culture plays an important role in maintaining cost-effective business operations to sustain cost leadership business strategy for the furniture giant. In other words, due to its cost leadership business strategy, IKEA does not offer the most competitive financial compensation to its workforce. Instead, the home improvement and furnishing chain attracts employees with intangible benefits that are deeply integrated within IKEA corporate culture.

IKEA organizational culture is based on the following principles:

1. Simplicity and high level of informality . It has been noted that “humbleness in approaching tasks and simplicity in the way of doing things are cornerstones of the IKEA culture”. [1] For example, in IKEA US only a few executives have business cards and “everyone is on a first-name basis and sits side by side at IKEA desks and if you have an ego that needs stroking, IKEA is not the workplace for you.” [2]

2. The value for teamwork . Executives who prefer to manage as one-man show do not fit into IKEA organizational culture. The Swedish furniture chain wants to ensure that it employs only individuals who share its values and appreciate its culture. For this reason, individuals wishing to join IKEA are offered to take an online test which poses a series of 10 work-based scenarios with a choice of actions. The outcome of the test advises applicants if they are likely to ‘fit’ into IKEA organizational culture.

3. Embracing diversity among employees and different ways of doing things . Diversity among the workforce in terms of gender, race, age, ethnicity and sexual orientation is an important element of IKEA corporate culture. As illustrated in table below, there is an adequate level of women representation among across franchisees in floor level workers, as well as, management.

IKEA employee gender diversity in FY21 [3]

Furthermore, the furniture retailer supports the rights of its LGBT+ employees to be themselves. The company also aims to increase the representation of various minority groups among the workforce. The world’s largest furniture retailer believes that recognizing differences among its employees contributes to creativity and supports the growth of the business.

4. Frugality . Late IKEA founder and long-term leader Ingvar Kamprad was famous for his frugal money habits such as driving a 1993 Volvo 240 GL for two decades, purchasing clothes from the flea markets and getting haircuts when travelling in developing countries to save money. [4] High level of frugality of founder has reflected on IKEA corporate culture to a certain extent in a way that managers at all levels are encouraged to cut costs in all areas of the business.

5. Recruitment through values . During the hiring process The Swedish furniture chain invests a lot of time and energy to understand personality, values and attitudes of candidates to only recruit people who fit IKEA corporate culture. In other words, the personalities of candidates are as important as their skills and competencies. [5]

IKEA Group Report contains the above analysis of IKEA organizational culture. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on IKEA . Moreover, the report contains analyses of IKEA leadership, organizational structure and business strategy. The report also comprises discussions of IKEA marketing strategy, ecosystem and addresses issues of corporate social responsibility.

[1] Heritage (2017) Inter Ikea Group, Available at: http://www.inter.ikea.com/en/about-us/heritage/

[2] Kowitt, B. (2016) “At Ikea, Everybody Is Equal” Fortune, Available at: http://fortune.com/2016/03/10/ikea-corporate-culture-best-companies/

[3] Sustainability Report FY 2021, IKEA

[4] Martin M. (2018) “4 unusual ways self-made billionaire IKEA founder Ingvar Kamprad insisted on saving money” CNBC, Available at: https://www.cnbc.com/2018/01/29/money-habits-of-self-made-billionaire-ikea-founder-ingvar-kamprad.html

[5] Werber, C. (2022) “How IKEA maintains culture for 170,000 global employees” Quartz, Available at: https://qz.com/work/2113323/how-ikea-maintains-workplace-culture-for-170000-distributed-employees/

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IKEA Case Study Analysis: Talent Management and Corporate Culture

Overall, IKEA’s success in its worldwide expansion suggests that its talent management strategies have been adequate to past needs. With that said, it does not necessarily follow all of the steps of talent management as defined by Mercer, which may lead to difficulties. The company has a well-established imperative and understanding of workforce gaps and risks, working to fill them. It engages in a talent development strategy, recruiting workers and training them to fill roles they suit best, and uses all of the people practices and programs described. However, the company’s recruitment approach is to make decisions based on their values and beliefs rather than abilities or talents. Hence, the talent implications, demand, and supply steps are omitted, which may harm IKEA’s performance. Moreover, with its egalitarian approach, difficulties may emerge during talent development that also need to be addressed.

To understand market implications, IKEA will need to formulate its strategic objectives and determine what competencies it needs to achieve them. Wilcox (2016) provides the example of international expansion, which can benefit strongly from the presence of workers that can speak the language of the country and understand its market dynamics. IKEA’s current model does not account for such needs, and these skills are challenging to develop in existing employees. Based on the implications and the current needs of the company, it can also determine its talent demand and possibly incorporate it in the hiring process. Lee (2018) notes that the belief that low-skilled positions, which include IKEA shop workers, do not need talent and can be trained is fallacious. Employees with affinities for the positions they will be occupying will ultimately perform better than their less well-suited counterparts.

Once the talent that the company needs has been determined, it can analyze the talent supply. As Rothwell, Arnold, and Evans (2019) state, this task is best accomplished by focusing on the abilities required for the company and conducting research in the population regarding the presence of the corresponding skills. A market research company will likely need to be hired for the second purpose, as IKEA is unlikely to have the necessary competencies and resources. These analytics should be collected for both the short and the long term to shape the business’s HR policy for the future. Ultimately, the company should understand the results it can produce by both promoting employees internally and hiring external ones and make hiring and promotion decisions based on this knowledge.

IKEA’s current HR strategy involves evaluating employees for performance and potential and assigning training and promotions to the most capable ones. With that said, it views all employees as equal, which has led to legal issues before due to alleged discrimination (IBS Center for Management Research, 2020). As Collings, Mellahi, and Cascio (2017) note, these two approaches are contradictory as the talent development strategy explicitly focuses on the differences between workers when choosing whom to train. The court case may be seen as an inevitable extension of this problem, with the company alleging equality without practicing it. To overcome this issue, Collings, Mellahi, and Cascio (2017) recommend focusing on fairness and transparency, acknowledging that differences exist between employees, and ensuring that everyone understands the process by which career growth can be secured. By adopting this approach, IKEA can retain its talent development approach while improving its results and avoiding legal issues.

Reference List

Collings, D. G., Mellahi, K. and Cascio, W. F. (eds.) (2017) The Oxford handbook of talent management . Oxford: Oxford University Press.

IBS Center for Management Research (2020) IKEA’s talent management and corporate culture. Web.

Lee, T. R. (2018) Entrepreneurial management theory and practice: with cases of Taiwanese business . Singapore: World Scientific Publishing Company.

Rothwell, A., Arnold, J. and Evans, M. (2019) From talent management to talent liberation: a practical guide for professionals, managers and leaders . Abingdon: Taylor & Francis.

Wilcox, M. (2016) Effective talent management: aligning strategy, people and performance . Abingdon: Taylor & Francis.