LEGO Group vs. IKEA: CASE STUDY. Management Case Study

LEGO Group vs. IKEA: CASE STUDY
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Question1. Compare and contrast IKEA and Lego Group for Strategic competitive priorities
The Business strategy of IKEA is built on the company’s concept. From the mission of the company, it is determined to provide a range of home furnishing products at an affordable price to many customers. The company wants to achieve this by combining quality, design, function and value while still holding sustainability in mind. This concept exists in all parts of the company including the sourcing, packaging, design, and distribution all through the company’s business model (Hultman, Johnsen, Johnsen, and Hertz 2012, p. 11). Cost effectiveness is one of the competitive strategies adopted b both IKEA and Lego Group that make the companies competitive to their market rivals. IKEA provides premium standard furniture at low prices because of its technological power and economies of scales that it integrates into different business processes.
Another competitive strategy of IKEA and Lego Group lies in their wide range of products. In IKEA’s portfolio, there are nearly 9500 products and the company renews the range of its products by launching nearly 2500 new products on an annual basis (Yang and Shao 2019, p. 1). The company has also increased its presence in catering and food industries. Compared to Lego, IKEA provides wide range of products in every market across the globe. Lego Group has put more of its focus on the children playing toys while IKEA has fused both playing toys, world class furniture amongst other products.
Market expansion in international markets is another strategy employed by both Lego and IKEA. For IKEA, the furnishing chain and home improvement has aggressively engaged new markets internationally. The company operates more than 420 stores in more than 50 markets around the world. In 2018 alone, IKEA opened 19 new stores worldwide. Further, the company has more than 20 pick points in more than 10 countries and 41 shopping centers in 16 countries across the world. Market expansion strategy is also adopted by Lego Company which also has many stores across the world. Both Lego and IKEA companies benefit from strategic alliances (Hultman, Johnsen, Johnsen, and Hertz 2012, p. 13). IKEA has partnered with mega brands including Apple and together they have explored the possibilities of developing new products, augmenting realities and knowledge sharing. Lego has also partnered with different companies including IKEA and Adidas to develop new products, share information on customer behaviors and share their experiences and competencies in business.
Question2. Compare and contrast IKEA and Lego Group for Process design and layout (40
Both IKEA and Lego have great process design and layout which have made the customers more attracted to the two mega brands. IKEA has a unique entrance and exit. Once a customer goes through the sliding entrance doors, they begin their journey to its maze. Lego has friendly staffs that greet the customers and provide them with shopping bags. Similaly, in IKEA, shoppers pick shopping bags at the entrance. Its store layout is ...