Ingvar Kamprad: Wealthy Man, Frugal Man, Entrepreneur Case Study

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Ingvar Kamprad: Wealthy Man, Frugal Man, Entrepreneur Extraordinaire

The case concerns Ingvar Kamprad, former CEO of IKEA. To comply with Dutch age retirement laws for chief executives, he retired from the position in 1999, but remains actively involved in running the company. His three sons also work at the company. As Ingvar grew up, he developed an entrepreneurial spirit by selling various items at his local neighborhood. He started IKEA with a cash gift he received from his father when he was seventeen years old. From its humble beginnings, the company grew to be an international power. To ensure its success, Kamprad has ensured a paternalistic employment paradigm combined with a social safety net as well as a drive for profits and market share. To promote the culture of hard work as a requirement of success, IKEA functions on the basis of frugality, which is manifest in actions such as sharing hotel rooms and using employees as catalog models. Although Kamprad has faced numerous challenges and negative rumors throughout his career, his philosophy of continuous critical questioning and his personal humility have served him well on his way to becoming on of the wealthiest individuals today.

Question: In what ways is Ingvar Kamprad a manager? In what ways is he a leader?

Answer: According to Blanchard and Zigami (2011), leaders and managers do not see the same aspects of work as important. Whereas managers are more concerned with the logistics required to ensure profits, leaders tend to focus on the way in which the people working under him or her can be encouraged to ensure the best outcomes for the company. Ideally, a company leader should be both manager and leader; this is something that Kamprad has accomplished.

He is a manager in terms of ensuring the top drive of competitiveness, market share, and profitability for his company. On the other hand, he is a leader by doing this in a way that ensures worker satisfaction and that provides a good example for them to follow. Kamprad leads by example in being absolutely frugal in his own lifestyle. He requires the same of his employees. Furthermore, he maintains a sense of personal integrity in the face of mistakes and rumors, moving on from these with a sense of personal growth and future improvement.

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Question: Describe the nature of followership that Kamprad seems to have encouraged at IKEA.

Answer: The type of followership that Kamprad seems to encourage functions in terms of active participation. Followers and managers alike are required to engage in continuous critical thinking. Employees are encouraged to continually ask why the company is doing the things it is doing, and how the company is expected to move forward. Employee input is encouraged and recognized for the benefit it can provide to the company and its operations. Indeed, its "flat box" trademark is the result of an employee's involvement in fitting a table into a customer's car.

Question: Using the Leadership Grid and its underlying leader behaviors of "concern for results" and "concern for people," explain the leadership orientation of Ingvar Kamprad.

Answer:

According to Alagse, the leadership grid indicates the balance between a leader's concern for production or results (also denoted as task behavior) and his or her concern for people (or relationship behavior). The Y-axes represents the concern for results, while the X-axis represents a concern for people. Each axis functions on a scale of 9 points, where the lowest value (1) represents the lowest level of concern, while a value of 9 would indicate the highest concern.

In terms of the grid, it seems that Kamprad is both concerned with the highest level of performance, while also maintaining a high concern for people. Indeed, he appears to understand that, in order to reach optimal result, optimal relationships need to be cultivated with and among employees. Only with a top level of concern for people could a top level of performance be reached. In terms of numerical grid value, Kamprad can therefore be estimated at 9.9.

Question: Use the concepts of transactional, transformational, charismatic, and authentic leaders to describe the leadership of Ingvar Kamprad.

Answer:

Transactional leaders operate under the assumption that social systems work best when there is a clear chain of command (Changing Minds, 2011). The primary motivation that employees need is focused upon the dynamic between reward and punishment, while employees should be required to cede all authority to their managers and to do what managers tell them to. Transformational….....

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