Global Strategy - Benchmarking Assignment Example | Topics and Well Written Essays - 750 words

Global Strategy - Benchmarking - Assignment Example In this case, the benchmark is a Swedish furniture giant IKEA. This effect can be felt because it one of the leading global furniture shops who have also felt the effect of fluctuations in profit margins before rising again to achieve its level of competitiveness (Baldegger, 2012). The IKEA pioneered the initiatives of benchmarks by expanding regionally both in Europe and China, the market for its products had risen by 40% despite the fact that its local markets were still not making enough profits. Besides, when the company ventured into the United States Market, it was forced to redesign its commodities so as to suite the need. This led to sudden fluctuation of IKEAs’ market, but was later revived due to market stability and high demand (Peng, 2014). IKEAs’ success in the global market has been highly dependent on strategic benchmarking. This involves laying down all the strategies needed to improve the success of the company. Having realized that the local markets were not giving substantial returns to the company, IKEAs’ ventured into the global market by making modification on its brand to suite the demand of a particular business. In essence, in the United States, the company decided to construct their store layouts to look like typical layout apartments. Besides, the company made joint ventures with the locals, and this was used as a strategy to test new markets (Peng, 2014). The benchmark that has been implemented by this company did not hinder in any way the success of its local markets because these markets were already making losses. Moreover, the company benchmark was based on cost, promotion and design, which differed from one area to another. Therefore, each area was best suit to set up its own business (Peng, 2014). Any business organization who ventures into global markets must be ready to face numerous risks such as the risks of wining the trusts of