Value Chain Management: IKEA Case Study

In the procurement process, selecting the supplier is the final step.

Raw materials are an example of supplementary materials purchased by an organization.

E-procurement solutions can reduce the time between need recognition and order release and receipt.

In organizational buying behavior, the buying process is influenced by the characteristics of the product, such as its complexity and importance.

The primary task of procurement management is to ensure that the company has a secure supply of goods and services at the lowest possible cost.

In a reversed auction, the buyer determines the price and suppliers bid down the price.

The procurement function is responsible for managing the supply chain, including inbound and outbound logistics.

E-procurement can reduce the administrative burden and improve communication with suppliers.

The procurement process involves only the procurement team, and does not involve other stakeholders.

IKEA's value chain includes inbound logistics, operations, outbound logistics, marketing and sales, and services.

At Stage 2 of the procurement process, the primary focus is on cross-functional team-based problem-solving.

The procurement strategy at Stage 3 is characterized by a strong central procurement department.

In Stage 5, the emphasis is on reducing the total life cycle cost of purchased goods and services.

The procurement strategy at Stage 6 focuses on delivering value to the end customer.

There is no explicit procurement strategy in place at Stage 1.

At Stage 4, the emphasis is on cross-unit coordination and compliance with nationally negotiated contracts.

Procurement digitalization has hindered procurement operatives from working on procurement development

The objectives and targets for procurement are always defined and measurable

The post-contractual stage is not relevant in purchasing business services

The share of purchased goods in the value proposition is decreasing

Subcontractors do not seek support from their suppliers

Procurement is a standalone function that is not integrated with other business domains