Evaluating IKEA's Organizational Structure (Essay Sample)

Organizational Structure: Comparisons with IKEA
Student’s Name
Institution Affiliation
IKEA
           The structure of an organization plays a significant role in determining the direction the company takes and its effectiveness. For companies such as IKEA, the constant need to expand and become a global entity comes with the need to have a structure that complements the part. Globalization comes with a lot of competition from other companies. To maintain the company’s position in the global market, it is essential to create and instill a complex structure and culture that will stand the international market challenges. The structure should be able to supplement progressive strategies while incorporating regions and operations management. Despite its robust structure, IKEA is facing serious completion from Tesco, Wal-mart, and Wayfair. This paper will analyze their structure in comparison to IKEA.
About IKEA
IKEA is renowned for its quality furniture products and home appliances. The company started as a small organization but over the years, it has grown to become a multinational firm with a global presence across over 27 countries (Dudovskiy, 2017). Aside from that, the firm also has several strategies that are highly coveted by other firms. These strategies include a new product development strategy, cost leadership strategy international expansion strategy. Moreover, it has a compact style of management that seeks to fulfill the vision and mission of the company. The management is so vital in ensuring the strategies of the company are achieved while fostering employee involvement (Grant & Jordan, 2016). It combines the activities of every employee with the international market for better operations and strategy achievement.
Old IKEA Organizational Structure
           The fact that IKEA has been able to maintain its market presence over the years shows that it has a good and effective organizational structure. It has been able to accomplish some things which have become its trademarks. Some of them include strong financial strength, market leadership, and democratic design concept. It has adopted a flat framework whereby there are fewer layers of management (Chu et al., 2013). This makes supervision easy and effective while at the same time encouraging action freedom by the employees. Their framework has encouraged their employees to be productive. Despite their currently working structure, some weaknesses need to be addressed. There is a need for greater job involvement for the employees to suit the innovative global market. 
New IKEA organizational structure.
The main objective of IKEA is to expand its global presence through innovative headways. As a result, the company recently restructured their organization to complement its goals (Chu, Girdhar & Sood, 2013). Same to their culture, the new structure is decentralized, flexible and is focused on employee satisfaction by using low management levels. The new positions in the structure have very detailed job description to maximize on their options of getting the best candidate for it (Chu et al., 2013). The new structure strive to foster, employee satisfaction, job involvement and innovativeness.
IKEA Organic Organization Structure
Inter. IKEA Holding B.V
IKEA System B.V
IKEA Industry Holding. B.V
IKEA Supply AG
IKEA Sweden AB
Administration Staff
Purchasing Staff
Production Staff
Project Manager 1
Administration Staff
Purchasing Staff
Production Staff
Project Manager 2
Determination for the need for an Organic Structure
           Being an international face, IKEA is open to the increased competition every year. However, in some places such as Russia, the competition is retrogressive. Furthermore, the wide and vast number of employees the company has makes it quite challenging to supervise. Nonetheless, the company takes pride in its decentralized structure as it allows the free flow of information while promoting cross-functional and hierarchical teams (Chu et al., 2013). 
           IKEA needs to maintain their global status as they seek expansion. This can only happen when the company’s structure is in line with the strategies, vision, mission, and policies. Since the company's center of attention is in the job involvement of employees, it should continue nurturing the same while focusing on a positive attitude.
TESCO