Ingvar kamprad leadership

Ingvar Kamprad

Wealthy Man, Frugal Man, Entrepreneur Extraordinaire

Although octogenarian Ingvar Kamprad, the founder of Swedish-based IKEA, is one of the wealthiest individuals in the world, he nonetheless lives quite frugally. Kamprad avoids wearing suits, flies economy class, takes the subway to work, drives a ten-year-old Volvo and frequents inexpensive restaurants.[endnoteRef:1] “It has long been rumored in Sweden that when his self-discipline fails and he drinks an overpriced Coke out of a hotel minibar, he will go to a grocery store to buy a replacement.”[endnoteRef:2] [1: C. Daniels, “Create IKEA, Make Billions, Take Bus,” Fortune 149(9) (May 3, 2004): 44; P. Davis, “Billionaire Attributes Modesty: Ingvar Kamprad, IKEA’s Founder & Owner,” http://ezinearticles.com/?Billionaire-Attributes---Modesty:-Ingvar-Kamprad,-Ikeas-Founder-and-Owner&id=274361 (accessed July 17, 2011).] [2: C. Daniels, “Create IKEA, Make Billions, Take Bus,” Fortune 149(9) (May 3, 2004): 44.]

Kamprad was “born in Småland in the south of Sweden a region known as home to many entrepreneurs and hard-working people, who are adept at using efficiently what limited resources they have.”[endnoteRef:3] Kamprad developed an entrepreneurial spirit in his youth. As a youngster, Kamprad rode his bicycle throughout the neighborhood, selling matches, pens, and Christmas cards to the local residents.[endnoteRef:4] Then in 1943 when he was only 17 years old, Kamprad used a cash gift from his father to form a company called IKEA. The name IKEA was derived from Ingvar Kamprad’s initials plus the first letters of the farm and village where he grew up (Elmtaryd and Agunnaryd).[endnoteRef:5] [3: A. Yakhlef, “The Trinity of International Strategy: Adaptation, Standardization and Transformation,” Asian Business & Management 9(1) (March 2010): 47-65.] [4: Anonymous, “How He Made His Pile: Ingvar Kamprad,” Management Today (September 2008): 20.] [5: C. Daniels, “Create IKEA, Make Billions, Take Bus,” Fortune 149(9) (May 3, 2004): 44; J. Scully, “IKEA,” Time (Summer 2004): 16.]

Initially, IKEA was a catalog company that sold pens, picture frames, wallets, and other bargain goods. “Kamprad used his village’s milk van to deliver his products when he first started the business. In 1951, IKEA began selling furniture made by local carpenters; six years later Kamprad opened the first IKEA store in Sweden. In 1985 the first U.S. IKEA which measured three football fields long opened in a Philadelphia suburb called Plymouth Meeting.”[endnoteRef:6] By 2010, IKEA had grown to 316 stores around the world with 699 million visitors, in-person and online.[endnoteRef:7] IKEA “has stores in thirty-three countries, while continuing to expand markets in China and Russia.”[endnoteRef:8] [6: C. Daniels, “Create IKEA, Make Billions, Take Bus,” Fortune 149(9) (May 3, 2004): 44.] [7: Anonymous, “Facts & Figures, IKEA Stores 1954-2010,” IKEA Web site, http://franchisor.IKEA.com/showContent.asp?swfId=facts1 (accessed July 17, 2011); Anonymous, “Facts & Figures, IKEAs Store Visits 1954-2010,” IKEA Web site, http://franchisor.IKEA.com/showContent.asp?swfId=facts1 (accessed July 17, 2011).] [8: P. Davis, “Billionaire Attributes Modesty: Ingvar Kamprad, IKEA’s Founder & Owner,” http://ezinearticles.com/?Billionaire-Attributes---Modesty:-Ingvar-Kamprad,-Ikeas-Founder-and-Owner&id=274361 (accessed July 17, 2011).]

As stated on the company’s Web site, “[t]he IKEA vision is to create a better everyday life for many people. We make this possible by offering a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them”[endnoteRef:9] and to do so without compromising quality.[endnoteRef:10] “Consistent with the Swedish lifestyle, the IKEA product range is functional, attractive, child-friendly and family-centered, covering the needs of all family members.”[endnoteRef:11] “IKEA uses natural materials such as pale wood, natural textiles (linen and cotton), glass, clay and untreated surfaces. The natural character of these products has bestowed on them a universal utilitarian appeal.”[endnoteRef:12] [9: Anonymous, “Inter IKEA Systems B.V.,” IKEA Web site, http://franchisor.IKEA.com/index.asp (accessed July 17, 2011).] [10: A. Yakhlef, “The Trinity of International Strategy: Adaptation, Standardization and Transformation,” Asian Business & Management 9(1) (March 2010): 47-65.] [11: A. Yakhlef, “The Trinity of International Strategy: Adaptation, Standardization and Transformation,” Asian Business & Management 9(1) (March 2010): 47-65.] [12: A. Yakhlef, “The Trinity of International Strategy: Adaptation, Standardization and Transformation,” Asian Business & Management 9(1) (March 2010): 47-65.]

A signature characteristic of the company is that “all IKEA products from furniture to the now famous mobile kitchens could be packed in flat, stackable boxes that could be mailed or transported and reassembled at home.” [endnoteRef:13] Interestingly, the flatpack idea for furniture arose by accident when an employee took the legs off a table in order to load it into a customer’s car.[endnoteRef:14] [13: J. Scully, “IKEA,” Time (Summer 2004): 16.] [14: Anonymous, “How He Made His Pile: Ingvar Kamprad,” Management Today (September 2008): 20.]