International expansion through flexible replication: Learning from the internationalization experience of IKEA

Business organizations may expand internationally by replicating a part of their value chain, such as a sales and marketing format, in other countries. However, little is known regarding how such "international replicators" build a format for replication, or how they can adjust it in order...

Full description

Saved in:

Bibliographic Details
Published in:	Journal of international business studies 2011-12, Vol.42 (9), p.1079-1102
Main Authors:	Jonsson, Anna, Foss, Nicolai J
Format:	Article
Language:	eng
Subjects:	Adaptation Business Administration Business and Management Business growth Business models Business Strategy/Leadership Business structures Case studies case theoretic approaches Economics and Business Ekonomi och näringsliv Expansion Företagsekonomi Globalization IKEA International Business Internationalization Knowledge management Knowledge sharing knowledge-based view Learning Logistics management Longitudinal studies Management Management development Management education Management theory Marketing Marketing management Multinational corporations Organization organizational Organizational behaviour Organizational learning Organizational research primary data source Product management Project management Replication Retail stores Sales management Samhällsvetenskap Social Sciences Strategic management Sweden theories and foreign market entry Value chain
Online Access:	Get full text
Tags:	Add Tag No Tags, Be the first to tag this record!

Description
Summary:	Business organizations may expand internationally by replicating a part of their value chain, such as a sales and marketing format, in other countries. However, little is known regarding how such "international replicators" build a format for replication, or how they can adjust it in order to adapt to local environments and under the impact of new learning. To illuminate these issues, we draw on a longitudinal in-depth study of Swedish home furnishing giant IKEA, involving more than 70 interviews. We find that IKEA has developed organizational mechanisms that support an ongoing learning process aimed at frequent modification of the format for replication. Another finding is that IKEA treats replication as hierarchical: lower-level features (marketing efforts, pricing, etc.) are allowed to vary across IKEA stores in response to market-based learning, while higher-level features (fundamental values, vision, etc.) are replicated in a uniform manner across stores, and change only very slowly (if at all) in response to learning ("flexible replication"). We conclude by discussing the factors that influence the approach to replication adopted by an international replicator.
ISSN:	0047-2506 1478-6990