3 Profit gives us resources
A better everyday life for the many people! To achieve our aim, we must have resources – especially in the area of finance. We do not believe in waiting for ripe plums to fall into our mouths. We believe in hard, committed work that brings results.
Profit is a wonderful word! Let us start by stripping the word profit of its dramatic overtones. It is a word that politicians often use and abuse. Profit gives us resources. There are two ways to
get resources: either through our own profit, or through subsidy. All state subsidies are paid for either out of the state’s profit on operations of some kind, or from taxes of some kind that you and I have to pay. Let us be self-reliant in the matter of building up financial resources too.
The aim of our effort to build up financial resources is to reach a good result in the long term. You know what it takes to do that: we must offer the lowest prices, and we must combine them with good quality. If we charge too much, we will not be able to offer the lowest prices. If we charge too little, we will not be able to build up resources. A wonderful problem!
It forces us to develop products more economically, to purchase more efficiently and to be constantly stubborn in cost savings of all kinds. That is our secret. That is the foundation of our success.
4 Reaching good results with small means
That is an old IKEA idea that is more relevant than ever. Time after time we have proved that we can get good results with small means or very limited resources. Wasting resources is a mortal sin at IKEA. It is not all that difficult to reach set targets if you do not have to count the cost. Any designer can design a desk that will cost 5,000 kronor. But only the most highly skilled can design a good, functional desk that will cost 100 kronor. Expensive solutions to any kind of problem are usually the work of mediocrity.
We have no respect for a solution until we know what it costs. An IKEA product without a price tag is always wrong! It is just as wrong as when a government does not tell the taxpayers what a “free” school lunch costs per portion.
Before you choose a solution, set it in relation to the cost. Only then can you fully determine its worth.
Waste of resources is one of the greatest diseases of mankind. Many modern buildings are more like monuments to human stupidity than rational answers to needs. But waste costs us even more in little everyday things: filing papers that you will never need again; spending time proving that you were right anyway; postponing a decision to the next meeting because you do not want to take the responsibility now; telephoning when you could just as easily write a note or send a fax. The list is endless.
Use your resources the IKEA Way. Then you will achieve good results with small means.
5 Simplicity is a virtue
There have to be rules to enable a lot of people to function together in a community or a company. But the more complicated the rules are, the harder they are to comply with. Complicated rules paralyse!
Historical baggage, fear and unwillingness to take responsibility are the breeding ground for bureaucracy. Indecisiveness generates more statistics, more studies, more committees, more bureaucracy. Bureaucracy complicates and paralyses!
Planning is often synonymous with bureaucracy. Planning is, of course, needed to lay out guidelines for your work and to enable a company to function in the long term. But do not forget that exaggerated planning is the most common cause of corporate death. Exaggerated planning constrains your freedom of action and leaves you less time to get things done. Complicated planning paralyses. So let simplicity and common sense guide your planning.
Simplicity is a fine tradition among us. Simple routines mean greater impact. Simplicity in our behaviour gives us strength.
Simplicity and humbleness characterise us in our relations with each other, with our suppliers and with our customers. It is not just to cut costs that we avoid luxury hotels. We do not need fancy cars, posh titles, tailor-made uniforms or other status symbols. We rely on our own strength and our own will!
6 Doing it a different way
If we from the start had consulted experts about whether a little community like Älmhult could support a company like IKEA, they would have undoubtedly advised against it. Nevertheless, Älmhult is now home to one of the world’s biggest operations in the home furnishings business.
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.
It is no coincidence that our buyers go to a window factory for table legs and a shirt factory for cushions. It is quite simply the answer to the question “why”.
Our protest against convention is not protest for its own sake: it is a deliberate expression of our constant search for development and improvement.
Maintaining and developing the dynamism of our business is one of our most important tasks. That is why I hope, for example, that we will never have two identical stores. We know that the latest one is bound to have several things wrong with it, but, all things considered, it will still be the best yet. Dynamism and the desire to experiment must continually lead us forward. “Why” will remain an important key word.
7 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.
While we are concentrating on important areas, we must learn to do what people in Småland call “lista”. “Lista” is common term in Småland; it means “making do”, doing what you have to do with an absolute minimum of resources.
When we are building up a new market, we concentrate on marketing. Concentration means that at certain vital stages we are forced to neglect otherwise important aspects such as security systems. That is why we have to make extra special demands on the honesty and loyalty of every co-worker.
Concentration – the very word implies strength. Use it in your daily work. It will give you results.
8 Taking responsibility – a privilege
There are people at all levels in every type of company and community who would rather make their own decisions than hide behind those made by others. People who dare to take responsibility. The fewer such responsibility-takers a company or a community has, the
more bureaucratic it is. Constant meetings and group discussions are often the result of unwillingness or inability on the part of the person in charge to make decisions. Democracy or the obligations for consultation are sometimes cited as excuses.
Taking responsibility has nothing to do with education, financial position or rank. Responsibility-takers can be found in the warehouse, among the buyers, sales force and office staff – in short, everywhere. They are necessary in every system. They are essential for all progress. They are the ones who keep the wheels turning.
In our IKEA family we want to keep the focus on the individual and support each other. We all have our rights, but we also have our duties. Freedom with responsibility. Your initiative and mine are decisive. Our ability to take responsibility and make decisions.
Only while sleeping one makes no mistakes. Making mistakes is the privilege of the active – of those who can correct their mistakes and put them right.
Our objectives require us to constantly practise making decisions and taking responsibility, to constantly overcome our fear of making mistakes. The fear of making mistakes is the root of
bureaucracy and the enemy of development. 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.
It is always the positive people who win. They are always a joy to their colleagues and to themselves. But winning does not mean that someone else has to lose. The finest victories are those without losers. 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.
Exercise your privilege – your right and your duty to make decisions and take responsibility.
9 Most things still remain to be done. A glorious future!
The feeling of having finished something is an effective sleeping pill. A person who retires feeling that he has done his bit will quickly wither away. A company which feels that it has reached its goal will quickly stagnate and lose its vitality.
Happiness is not reaching your goal. Happiness is being on the way. It is our wonderful fate to be just at the beginning. In all areas. We will move ahead only by constantly asking ourselves
how what we are doing today can be done better tomorrow. The positive joy of discovery must be our inspiration in the future too. The word impossible has been deleted from our dictionary and must remain so.
Experience is a word to be handled carefully.
Experience is a brake on all development. Many people cite experience as an excuse for not trying anything new. Still, it can be wise to rely on experience at times. But if you do so, you should preferably rely on your own. That is usually more valuable than lengthy investigations.
Our ambition to develop ourselves as human beings and coworkers must remain high. Humbleness is the key word. Being humble means so much to us in our work and in our leisure. It is even decisive for us as human beings. It means not just consideration and respect for our fellow men and women, but also kindness and generosity. Will-power and strength without humbleness often lead to conflict. Together with humbleness, will-power and strength are your secret weapons for development as an individual and fellow human being.
Bear in mind that time is your most important resource. You can do so much in 10 minutes. Ten minutes, once gone, are gone for good. You can never get them back.
Ten minutes are note just a sixth of your hourly pay. Ten minutes are a piece of yourself. Divide your life into ten-minute unites and sacrifice as few of them as possible in meaningless activity.
Most of the job remains to be done. Let us continue to be a group of positive fanatics who stubbornly and persistently refuse to accept the impossible, the negative. What we want to do, we can do and will do together. A glorious future!