Learn more about our sustainable efforts including solar energy, water conservation, plastic reduction, social initiatives and more. We've received widespread press coverage since 2003, Your BusinessTeacher.org purchase is secure and we're rated 4.4/5 on reviews.co.uk. Consumers expect more from their favourite brands, companies and retailers, therefore one of the motivators for moving towards sustainability is consumer demand. Information in this assignment should not be used to form the basis for any kind of financial or investment advice, as the content may contain inaccuracies or be out of date.. 3579 words (14 pages) Business Assignment, 14th Dec 2020 This is no easy task given the scale of its retail operations but one has to give them credit for a grand vision. Sustainability: The search for the integral worldview. We are committed to making our products with more renewable and sustainable furniture materials like responsibly-sourced cotton and better plastics. Ikea's IKEA: The Sustainability Of The Environment. IBM, for instance, is trying to tackle the carbon footprint of its operations and supply chain by engaging with IBMers from different domains. This essay will broadly focus on environmental sustainability in supply chains and provide an in-depth case study example of IKEA. These mainly include building internal stakeholder support, establishing objectives, expectations and code of conduct, supply chain mapping and prioritisation, supplier engagement, industry collaboration and monitoring and evaluation. Abbasi, M., & Nilsson, F. (2012). Also consumers, mainly in the developed societies, are becoming more aware of the ecological consequences of their actions of buying and consuming products thereby leading to companies to tie sustainability to the core of their operations. They are the intermediaries between customers and producers, ensuring cooperation with industries leading to greater profitability and lower carbon emissions (Koberg & Longoni, 2019). �9\�������f������W��t��t���֖1=-%�##�,����F�Q,Ί�\����)�L��d� ��Dr��+�.V��/�@�M�d��z9��t�d9�Z�{t�(F= @ E'ŋk�\�(���P���t" ��i��j$� Q\�C����h�����[8ڝD�d%6 ����9�J@�@�I���3��Kр�/%�V:�@|�� �bHo0ȹ��@��]�pA,P�0� l pY&Hb` �ʀ����R(����JU1���"� @�e�Z� J�JX�(̈́���0@1�2�s��*�$D;��4�t�=��[��X��������]�;e� 0�E٬�\��HX�$��6�F3� �@"��5���eH�3j �n� Business Assignment Reducing the total IKEA climate footprint by an average of 70% per product, by 2030. DfY�e�Ad�Iɜ"�VIF��`�M@���F&FFm�9�T �30x0 J�# Is it necessary to take collective action against environmental issues occurring in our planet? It also minimises order fulfilment costs. Other interesting activities which IKEA is involved in includes reducing its water consumption, designing products to minimise water use in manufacturing by using a printing technique called Soft Pigment Printing. h�b```f``��\ZB ���� Clothing and shoe brand Timberland attempts to ensure all their produces are made in an environmentally friendly manner. The IKEA sustainability strategy The IKEA vision is to create a better everyday life for the many people, and we believe those lives are truly better when they’re lived sustainably. Graciola, A. P., Rizzon, F., Milan, G. S., Toni, D. D., Rocha, J. M., & Olea, P. M. (2018). Expanding the offer of affordable home solar solutions to 29 IKEA markets* by 2025. In a statement issued along with the group’s 2030 sustainability strategy document, Torbjorn Loof, Inter IKEA CEO, said, “Through our size and reach we have the opportunity to inspire and enable more than one billion people to live better lives, within the limits of the planet.” an approach for classifying inventory items depending on the item’s consumption values, and the 80/20 Pareto principle to categorise items based on value (Tradegecko, 2018). For a product and its packaging to be classified as more sustainable, it must score a certain number of points in the IKEA Sustainability Product Score Card. These are two of the main product attributes. This of course needs real time scrutiny of the supply chains. IKEA is a prime example of a company which aligns its business and operating models and relies on its value chain to optimise its production and overhead costs. It also focuses on increased availability of certified wood from responsibly managed forests but is trying to find alternative materials to avoid depletion of valuable resources. Besides fulfilling its vision of creating a better everyday life for as many as possible through well designed, functional, low priced, affordable products and sustainable supply chain- IKEA is doing its best to reduce its impact on the environment. These techniques and processes grant a competitive advantage to IKEA as it seeks more advanced methods to organise its supply chain well. One of the big movements going forward is about becoming even more affordable so that many more people can enjoy a better life at home– without compromising on sustainability, quality, or design. “We know that sustainable living often is a luxury for the few. Indeed, many global initiatives IKEA is involved with, such as RE100 and Science Based Targets programs, are very much focused on multinationals. It can negotiate prices with suppliers to attain the best prices and materials. At times there are supply chain errors which can lead to disasters. IKEA, the world’s largest Swedish founded home furnishing retailer with over 400 stores in 50 countries, has been successful in integrating sustainability practices into the management of the supply chain. Reference this, Tags: Business AssignmentsInternal AnalysisExternal AnalysisBusinessSupply ChainIKEA. For instance, during Christmas 2004, the Panamax cargo ship carrying Sony PlayStation 2 was blocked by an oil tanker in the Suez Canal, obstructing and delaying ships from China which were carrying the consignment of consoles. It includes people in research divisions (who invent technologies to detect and analyse data), those in charge of finance and accounts as well as discusses with suppliers to establish their environmental management system and goals. IKEA’s aim is to reduce consumption and carbon dioxide emissions, while also saving costs and increasing competitiveness. In India, too, sustainability in retail becomes more critical as it is a major (fastest) growing economy. Together with increased globalisation of supply chains, consumers are increasingly able to retrieve supply chain-related information about products. The sustainability report describes how the IKEA business tackles global challenges such as climate change, unsustainable consumption and inequalities. The organisation chooses rail transport where possible and tries to minimise goods going into intermediate storage in distribution centres- by using direct deliveries from suppliers to stores. Becoming People & Planet Positive it plans to use only recycled and renewable materials in its products by 2030 (Ringstrom, 2018). Along with brand studio Vox Creative, IKEA created the “stylish, sustainable, and affordable” 187-square-foot tiny home, after being inspired by their “shared commitments to sustainability, inclusivity and innovation.”The goal of the project is to prove “that anyone, anywhere can live a more sustainable life,” according to IKEA. In an interview with Ethical Corporation, Pia Heidenmark Cook concedes that it still early days for circularity. This is also related to increased competitions among companies and is an important element of success in the marketplace. 412 0 obj <> endobj The idea of environmental supply chain management is to create synergy and support efficiency throughout the steps in the supply chain, to enhance environmental performance, minimise waste and save costs. Free resources to assist you with your business studies! Achieving zero emissions home deliveries by 2025*. To export a reference to this article please select a referencing stye below: If you are the original writer of this assignment and no longer wish to have your work published on the UKDiss.com website then please: Our academic writing and marking services can help you! VAT Registration No: 842417633. Low flow warehouses stock items that get a little turnover and are run on manual operations since workers do not need to move as much inventory around. Even though technology is bringing about a lot of innovation and enhancing supply chain performance- achieving sustainable supply chain is hard due to the complexity and interrelations of the supply chain environment and management practices associated with it. But IKEA has faced criticism. IKEA’s sustainability initiative focuses on four areas: products and materials, suppliers, climate change and community involvement. By 2014, IKEA Group was the largest home furnishing company, with EUR28.5 billion of sales, and planned to reach EUR50 billion by 2020, mainly from emerging markets. However, it has also been receiving less welcome attention from other environmental groups who are claiming that Ikea is willfully deceiving its customers and hiding behind a "flawed" certification system. The retail sector is extremely complex, given its myriad sources and the respective diversified supply chains. Hence, companies design their operating models to have an optimum balance between financial efficiency and stable supply chain. Six Steps to a More Ethical and Sustainable Supply Chain. 208,000. Customers have also complained about defective products and have criticized its commitment to sustainability, lack of transparency of wood supply chain, issues like forced labour use, tax avoidance, greenwashing and unsustainable goals were under the limelight  (The Sustainable Guy, 2017). 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