LEADING THROUGH DIGITAL DISRUPTION ASSIGNMENT SAMPLE
Introduction
Adapting digital technologies to change business processes, organizational culture, or customer experiences can be regarded as digital transformation (Sousa et. al. 2019). In an increasingly competitive and dynamic business environment, change has become a necessity. In order to effectively manage change, organizations must devise strategies. Specifically, change management is the systematic process of dealing with and adapting to any changes generated by processes, goals, or technologies.
IKEA’s digital transformation is taken into account in the present report. Retail is the industry in which the company operates. The IKEA brand of home goods has been sold to people analogue for almost 80 years now (IKEA, 2022). The company’s headquarters is in the Netherlands, and it was founded in 1943. The report has an easily understandable structure, which is divided into various segments. The essay explains the case, offers ways to gain insights and makes quick decisions and hires employees. In addition, a section discusses establishing a digital-ready culture and choosing change leaders.
Figure 1: IKEA Logo
(Source: IKEA, 2022)
LO1 – The Case for Change
Furniture, kitchen appliances, and home accessories are all offered by the multinational conglomerate IKEA (Chan et. al. 2020). Founded in 2008, it is one of the largest furniture retailers in the world. The Middle East, Europe, North Africa, India, East Asia, South-east Asia, North America, and Oceania are among IKEA’s markets. An organization’s reputation is determined by its ability to control costs, develop products, and manage operations.
It has also been indicated that the company has 422 locations in around 50 countries as of March 2021. The company is undergoing a major digital transformation to accelerate business processes and enable informed decision-making. Several threats are facing the cited company. These challenges include intense competition, dissatisfied workers, and changing clients’ expectations. Increasing competition in the home furnishings industry has posed a threat to IKEA due to more and more companies entering this industry.
The employees are also facing issues due to the complicated operations and increased processes, so they have to work overtime. Thus, the employees are angry at the company and are dissatisfied with it as a result. Moreover, the company faces a continuous shift in the needs and preferences of its customers, which poses a threat. Culture, business model, process and domain are the four main pillars of digital transformation.
Process transformation is underway at IKEA. Improved customer service and increased internal collaboration are two of the primary goals of this transformation. This transformation can be an effective way to help the company perform efficiently in the market, as the competition in the market is growing (Verhoef et. al. 2021).
Work can be digitized, and the employee workload will decrease with process digitization. Therefore, this particular transformation will contribute greatly to customers’ satisfaction and the reduction of dissatisfaction among them. To summarize, IKEA intends to improve efficiency while reducing costs and enhancing employee performance.
Figure 2: Digital Transformation at IKEA
(Source: Banerjee, 2020)
Objectives of Digital Transformation
- Digital transformation provides opportunities for enhancing competencies to improve business processes (Osmundsen al.2018). For example, business processes might include manufacturing, marketing, and accounting. Digital transformation can target a few business units or the entire enterprise at once. Process improvement affects all parts of the business.
- Digital transformation allows businesses to measure and analyze vast amounts of data, improving agility and increased efficiency. With technology, businesses become connected yet flexible. Decision-making times are reduced, and learning cycles are shortened.
LO2 – Gaining Digital Business Agility
As a concept, ‘Digital Business Agility is considered a concept that has mainly been accepted by businesses that aim to respond to emerging business threats quickly and effectively (Prikladnicki et. al. 2019). Aside from this, the company has also taken advantage of new market opportunities before its rivals have detected them. This model consisted of three key pillars during the design process: informed decision-making, fast execution and hyperawareness afterwards.
The study focuses on IKEA’s core business operations and how an agile digital model can be applied there. These digital technologies and initiatives have been shown along with each component of the model, as follows:
Informed Decision-Making
The ability to make the best decision in a given business context has been viewed as the organization’s capability (Kouatli et. al. 2020). From this point of view, active decisions and experiences must be shared throughout, based on real data instead of past experiences. These organizations should have developed a framework that efficiently augments human judgment with data analytics to excel in this area.
By utilizing its 3D business model, IKEA has been able to come up with informed and successful business decisions. Two digital business accelerators are included in this dimension of the agility model. In the following section, these run parallel to ‘Inclusive Decision-Making’ and ‘Augmented Decision-Making’ and’ Augmented Decision-Making’.
Huge strategic business decisions have accompanied the workforce transformation initiative at IKEA in terms of augmented decision-making. Staff members can make quick decisions about the corporation with ubiquitous analytics, which is also implemented at the company.
This company also uses business spheres to visualize and analyze the right business decision. To ensure diverse viewpoints and expertise within IKEA’s business environment, it uses LinkedIn workforce and connections intelligence to ensure inclusive decision-making.
To ensure seamless operations, IKEA has relied mostly on state-of-the-art augmented reality methods to assist in the process of digital transformation. As well as ensuring high customer satisfaction and benefits, its AR and VR display helps track the movement of products from the warehouse to the stores.
Fast Execution
An organization’s ability to develop feasible business plans rapidly has been defined as its ability to be effective and efficient. As a result, a company has also made the right decisions and practices and has mobilized its employee and resource pool to handle changes and threats. Those with social media experience, analytical abilities, and the ability to connect with people should be given time and budget to uncover and recruit talent.
Reward the top candidates with rewards. Due to high organizational complexity and resulting changes, it becomes slow in cases of large incumbents according to (Udovita, 2020). At present, the initiative of workforce transformation is highly prioritized within the context of IKEA’s business environment. Two digital business accelerators are in this area, as well.
The word ‘Dynamic Processors’ was added to the list later, along with a new term, Dynamic Resources. Accordingly, IKEA has successfully utilized its financial, technological, and human resources in the field of dynamic resources. Aside from that, it is also considered necessary to ensure workforce productivity through both agile technology and agile talent in order to address emerging business needs. Apart from that, to ensure seamless HR functions, IKEA benefited from its employees’ valuable input for allocating the right talent.
On the other hand, in the context of dynamic processors, two elements have been delegated high priority, including rapid enablement and rapid intervention. By providing better customer service, better marketing, and better commercial support and building applications on the right platforms, organizations can ensure consistency in their business operations.
However, in terms of digital technology, IKEA has taken advantage of Artificial Intelligence (Al) to speed up core business operations. IKEA uses sensors to monitor real-time traffic with a PoS and integration across all of its stores, helping it manage optimally with dynamic changes. Besides using AI to enhance home visualization, IKEA has also incorporated augmented reality into its platform.
Hyperawareness
The ability of a business to detect and monitor changes in its core business environment has historically been considered an indication of its vulnerability. Business leaders who are hyper-aware will attribute their success to the constant transformation of the world, particularly those changes that highlight business opportunities and threats.
Communication and analytical skills are critical when developing hyperawareness-especially listening skills, insight formulation, and sharing information (Ubiparipović et. al. 2020). An employee may be able to provide these positive business insights. In a company, outside sources such as customers, partners, and competitors must provide information to the company’s internal environment.
Now that IKEA has been obtaining valuable insights from their customers, we see that the company has been able to gain positive results. However, IKEA’s effective business model must focus on social media marketing to position themselves as prominent leaders in the field, generating a lot of positive and efficient results. It is estimated that at least 75% of its total stores have been converted into online stores using digital solutions. This enables customers to take advantage of exquisite business opportunities.
IKEA has highlighted ‘situational awareness’ in its two digital business accelerators while two digital business accelerators include ‘behavioural awareness’. Providing a way for its employees to foster an environment of behavioural awareness, IKEA offers consistent real-time feedback, which has fostered a positive corporate culture.
The use of data analytics makes it possible for IKEA to ensure employee safety from various hazards and provide situational awareness. To shape a more digital future in business, IKEA also implemented augmented and virtual reality (AR/VR) technologies as part of its hyper-awareness.
Using augmented and virtual reality in-store, the company must make furniture more appealing to customers by showing them how things fit and look in their rooms. Moreover, IKEA’s business model, which revolves around 3D technology, has helped the company gain a competitive edge over other competitors present in the market.
LO3 – Creation of Digital Ready Culture
In our contemporary era of globalization, ‘Digital Ready Culture’ is defined as a set of values and practices deemed to be fundamental to business success on a global scale. Additionally, these modes of operation have allowed a company to be infused with advanced technology and innovation for high performance. Business cultures that embrace the digital age should trigger a variety of positive outcomes and benefits, all of which lead to high levels of digitization.
Putting Customer First
The digitized business scenario has led to greater value for IKEA’s customers during this period of the COVID-19 pandemic. Apart from technology, it offers differentiated products with new offers to its customers as part of its digital transformation in business. , (Chylinski et. al. 2020), explaining that IKEA has redesigned its customer demands with more efficient digital interactions and instantaneous integrations based on changing customer needs.
Digital-championship
In this case, IKEA has developed AR/VR options for its valued customers in order to become the worldwide digital champion. The option allows customers to buy actual furniture items for their homes as per their preference. As well as Al, sensors, online shopping platforms, self-checkout machines and others, there are numerous technology options to provide businesses with sustainable competitive advantages in the market.
Business culture must be collaborative
IKEA has strived hard over the past few years to change its previous business culture with digital business cultures, leading to positive changes in operations (Roy, 2020). The advancement of technology has also contributed to the importance of digital skills among workers. Additionally, IKEA’s business DNA favours engaging and collaborating with its employees to establish a better business culture and give people a better everyday life.
Implementing a culture of innovation in business
It has experimented a lot in implementing advanced technology and innovation to ensure an innovative culture within IKEA’s core business operations. Moreover, the 3D business model promoted the reuse and recycling of products to the greatest extent possible, contributing to the business’s sustainability. IKEA has offered an affordable price range for its customers with quality-standard products as its core strength, as emphasized by (Qu, 2021).
During this specific segment of the study, a new job description was presented at IKEA that is also designed to help break down barriers between teams and departments while providing incentives for collaboration (Strömstedt et. al. 2021). A job description for the Chief Collaboration Officer (CCO) position has been chosen. The following recommendations are also shown for the role in regards to collaboration at work:
| JOB TITLE:
Chief Collaboration Officer (CCO) |
| REPORTS TO:
The CCO will report to Chief Strategy Officer (CSO) |
| JOB OVERVIEW:
In addition to offering new roles and opportunities for becoming a CCO (Chief Collaboration Officer), IKEA has created new job positions and offers to new applicants. Managing and shaping business strategies for an organization is this person’s job. Additionally, they have contributed to the creation of organizational policies centred on further development. The company’s workplace must promote effective and extensive communication. |
| DUTIES & RESPONSIBILITIES:
Among the responsibilities of a prominent CCO are: · Maintaining an annual budget while leading a successful business strategy · Conducting annual evaluations to assess further improvements in organization and investments that contribute to its efficiency · Developing collaborative appeals and necessary proposals to support business development and fundraising · Ensure timely delivery of project deliverables and success · Providing seamless service delivery with a sustainable framework and continuous improvements · Ensure effective and efficient communication at work through timely, effective, and efficient design and implementation · Recruitment and hiring procedures that are fair and transparent to ensure adequate staffing · Ensuring that staff receives accurate performance evaluations with consistent feedback · A proper monitoring program should be designed according to the values and morals of the organization |
| SKILLS REQUIRED & QUALIFICATIONS:
· An undergraduate degree in real estate, public relations, architecture, or engineering · Regeneration experience of at least 2-3 years in urban planning and development · Extensive experience working with different types of communities · A good understanding of collaboration and participation with good communication skills · All kinds of amenities are offered for advanced computer training |
LO5 – Leadership Selection
Within this specific segment of the current analysis, Goleman’s Leadership Styles have been used to identify possible leadership styles within IKEA. Furthermore, IKEA has been given the following advice as to how it may develop prominent leadership techniques for its leaders:
Affiliative Leadership Style
As a result, a leader who practices this leadership style is capable of creating a harmonious working environment between bosses and employees and establishing strong emotional bonds between the two. The ability to build fruitful relationships through a variety of communication approaches is also a crucial component of this leadership style, as emphasized by (Bligh et. al. 2018).
To develop digital transformation adequately at IKEA, this leadership style must support an appropriate business environment. Therefore, they have been able to cultivate a positive environment at work. Most team members, existing employees, and other employees of the organization can provide praise in this manner. At this time, corrective actions are also being taken.
Coaching Leadership Style
Team leaders have drawn upon recognized strengths and weaknesses, in addition to motivations, to plan their leadership approach. These tools have facilitated individual personal and professional improvement, which companies have also used to motivate their employees toward success in the future.
As part of IKEA’s business transformation and growth strategy, multiple coaching scenarios are used to enable workers to improve their personal development toward achieving work-related targets and business goals. Employers are willing to make further improvements to achieve excellence. In addition, IKEA has also been told that its leaders have unlocked employee potentials by implementing the GROW Model of coaching.
Furthermore, the program has improved motivation and self-confidence. It is possible to promote a digital business culture embodied with advanced innovation and technology by asking the right questions to employees following the maintenance of this model. It has been able to successfully accomplish goals for overcoming obstacles further with the help of deep work awareness levels and high responsibility levels at work, according to (Cortellazzo et. al. 2019).
Conclusion
In this modern era of globalization, digital transformations and management have played crucial roles, a conclusion that can be drawn from the above in-depth discussion. Besides this, innovation and technology must help to provide a diverse set of benefits and outcomes with seamless work processes and systems.
To deliver a culture-ready workplace where employees are satisfied with their employers and the benefits they receive, IKEA must develop a digitally agile business cultural model. Additionally, affiliative leadership and coaching leadership styles were also found to be highly effective in triggering digital transformation within the company.
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