Hi,
This is Vikaas here, Investment Advisor and Founder of www.jaagrav.com. Today I am going to talk on the 2nd part of the Furniture Dealer’s Testament Series. This podcast is about IKEA’s founder, Ingvar Kamprad’s thoughts on simplicity, experimentation, human behaviour, differentiation, common sense, concentration and how to avoid lawyers; yes!!
So let me begin:
- No method is more effective than a good example. Simplicity is a virtue. Complicated rules paralyze! exaggerated planning is the most common cause of corporate death. – No company would have created a strategy or created a grandiose plan around Pandemic during their many off-site 2 or 3-year strategic meetings before 2020!!
- By always asking why we are doing this or that, we can find new paths. By refusing to accept a pattern simply because it is well established, we make progress. We dare to do things differently! Not just in large matters, but in solving small everyday problems too. – Small experiments yield results. AWS started as an experiment in Amazon and today it’s the most profitable segment.
- Concentration – important to our success: The general who divides his resources will invariably be defeated. Even a multitalented athlete has problems. For us too, it is a matter of concentration – focusing our resources. We can never do everything, everywhere, all at the same time. Our range cannot be allowed to overflow. We will never be able to satisfy all tastes anyway. We must concentrate on our own profile. We can never promote the whole of our range at once. We must concentrate. We cannot conquer every market at once. We must concentrate for maximum impact, often with small means. – Single product companies with strong focus have usually performed well, both functionally and financially!!
- No decision can claim to be the only right one; it is the energy that is put into the decision that determines whether it is right. It must be allowed to make mistakes. It is always the mediocre people who are negative, who spend their time proving that they were not wrong. The strong person is always positive and looks forward. – Execution is the key after all, isn’t it?
- Daring to be different is one of the most important criteria behind the IKEA success. It’s the thinking behind some of the most significant aspects of our business idea. Here are some examples: while other furniture retailers were selling manufacturers’ designs’ we started to make our own designs. While furniture dealers set up shop in the centre of town, IKEA was building large stores out of town. While others turned to furniture factories to help them make tables, IKEA got them made by door manufacturers. Whereas others sell their furniture assembled, IKEA lets customers assemble it themselves. – How many companies can differentiate themselves? Far few and between!!
- If somebody steals a model from us, we do not sue them, because a lawsuit is always negative. We solve the problem instead by developing a new and even better model. – Lawyers must be cursing them!!
- We are a low-cost company, and we must be seen to be one. Luxurious company cars, first-class flights, separate dining rooms and washrooms for senior staff are all status symbols. It’s not that we deny our hardworking managers a sense of status, it’s just that status symbols like this don’t fit in with our low-cost profile. – Personally, a firm believer in this!!
- Learn to make realistic judgements in your everyday work. How many visitors does the store have? How much storage space do you need for all that stock? Work out a few ratios you can use. What’s the average cost per cubic metre? How much space is needed to park a car? What’s the average cost for a newspaper ad, everything included? Learn these ratios by heart and use them! Question, and ask why! – How many 2nd generation promoter family heirs know this?? I doubt, handful!!
Last but not the least:
- Learn to use your common sense. Learn how to say “no” and learn how to stop activities which never should have been started in the first place. Learn to limit the number of decisions you have to make, because you know all too well that too many decisions tend to lead to poor results! It won’t necessarily make you popular, but at least you’ll be respected for it, and you’ll get the lasting results you need! – Making 2 or 3 effective decisions is what you need during your day to become successful. Isn’t it?
Hope you enjoyed listening to this!!
For more interesting topics, you may check out my website, www.jaagrav.com. If you want to reach out to me, you may email me at vikas@jaagrav.com
Thanks!