Companies adapt to cultures that are suitable for their businesses and industries. According to the Competing Values Framework theory, organizational cultures can be classified as a clan, adhocracy, hierarchy, or market cultures (Hughes et al., 2019). From the Competing Values Framework, the types of organizational culture that best describe the culture of IKEA are clan, market, and adhocracy. Clan culture emphasizes teamwork and participation among employees (Z. Acar & P. Acar, 2014). The clan culture is reflected in IKEA's policy of hiring people who are supportive and work well in teams (Hughes et al., 2019). Further, the company culture emphasizes establishing mutual goals and working relentlessly to achieve the common objectives (Hughes et al., 2019). On the other hand, a market culture emphasizes efficiency and achievement while adhocracy focuses on risk-taking, innovation, and change (Z. Acar & P. Acar, 2014). At IKEA, employees are expected to be cost conscious in their daily operations which suits the market culture (Hughes et al., 2019). The employees are also expected to be innovative to enhance their performances (Hughes et al., 2019). Thus, IKEA's culture can be categorized as a clan, market, or adhocracy culture.
Schein’s Four Key Organizational Factors Observed at IKEA
Schein identified four primary factors that describe an organization’s culture, namely, myths and stories, symbols and artifacts, rituals, and language (Hughes et al., 2019). Myths and stories are the historical tales passed down over time to communicate an organization’s underlying values (Hughes et al., 2019). The story that describes IKEA’s organizational culture is the belief that one has to be down to earth like the company’s founder, Ingvar Kamprad. Symbols and artifacts are the objects that describe the various features of an organization’s culture (Hughes et al., 2019). In the case of IKEA, it is the firm’s giant blue and gold warehouses that resemble Swedish flags. Rituals are recurring events that underscore the vital aspects of a company’s culture. In IKEA the predominant ritual is hiring co-workers who work well in teams. Language concern the jargon used by employees in the workplace. IKEA’s products are given Nordic names which represent the company’s language. Therefore, IKEA’s culture can be described using Schein’s four key organizational factors.
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Competitive Advantage of IKEA’s Culture
The leadership of an organization sets the culture and can change and strengthen the culture. Organizational culture is a considerable source of competitive advantage (Hughes et al., 2019). In the case of IKEA, the culture of teamwork and innovation will provide the organization with a source of competitive advantage. For one, a culture of teamwork promotes workplace collaboration which enhances the firm’s performance. Further, innovation enables the company to identify new ways to enhance its performance to gain competitive advantage. However, IKEA’s leadership may have to change the culture in the future in case of a merger with another firm, the current culture causes negative impacts on personnel, the company moves into a different industry or the current culture fails to suit future economic conditions (Ibidunni & Agboola, 2013). In such circumstances, IKEA’s management can reinforce the culture by adding or removing particular aspects of the organization or by enacting different policies and values such as rewarding different behaviors (Hughes et al., 2019). Thus, though the culture of IKEA is currently competitive, the company may have to change it in the future to suit the changing business environment.
References
Acar, A., & Acar, P. (2014). Organizational culture types and their effects on organizational performance in Turkish hospitals. EMAJ: Emerging Markets Journal , 3 (3), 18–31. https://doi.org/10.5195/emaj.2014.47
Hughes, R. L., Ginnett, R. C., & Curphy, G. J. (2019). Leadership: enhancing the lessons of experience (9th ed.). McGraw Hill Education.
Ibidunni, S., & Agboola, M. (2013). Organizational culture: Creating, changing, measuring, and consolidating for performance. European Journal of Business and Management , 5 (32), 177–186. https://www.researchgate.net/publication/317605448_Organizational_Culture_Creating_Changing_Measuring_and_Consolidating_for_Performance
