Journal Article

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

Foss, Nicolai J, Jonsson, Anna

2011

Overview

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.

• Publisher: Palgrave Macmillan,Palgrave Macmillan UK
• Subject: 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