Great post Andie! I am fascinated by how their operating model serves their business model of offering low-cost furniture. Part of that business model is transportation, I believe that IKEA believes in keeping transportation as a separate service from the furniture itself to an extent where they actually outsourced all of their delivery operations to third party agencies (@Yubo, this is possibly a reason why you didn’t receive an acceptable service). This way IKEA can focus on manufacturing low-cost furniture. In addition, a giant poster at IKEA-Stoughton lists the reason behind keeping delivery/transportation fees separate from furniture prices. The poster says that by keeping delivery fees separate we can guarantee that customers are not implicitly paying for transportation fees (when delivery price is bundled within the product price), and therefore serving the business model of maintaining affordability.
Reading this post, I couldn’t help but remember the conversations I had with UBER and Lyft drivers while commuting. Obviously, as a Business School students I always asked them questions to probe for the secret sauce in their operating model that is making Uber more successful than Lyft. (When compared to its main competitor Lyft, estimates show that Uber is valued at around $ 50-60 Billion, ~20x the estimated value of Lyft).
As Yi mentioned in the previous comment, this 2 sided business model needs a strong operating model to make it work. One element of this operating model is how Uber engages with its drivers from one side and customers from another side. I learned from my chats that Uber, as oppose to Lyft, focuses on maintaining a high level of loyalty among its drivers. In several occasions where there was a dispute between the driver and the rider, Uber took the driver’s side and banned the rider from using Uber’s service in the future. This balance create a fair environment for both sides and helped Uber deliver on its 2 sided business model and win the market.
I loved your post, Komal. I am a huge fan of this business model. As you mentioned, there is no need for major CapEx to expand and therefore makes the business easily scalable. However, when I think of the Hospitality Industry, the first thing that comes to my mind is the consistency of my experience as a customer across different regions and hosts. As a customer, I will get the service from the hosts themselves (when you think of the operations of the business), facilitated by airbnb as the middle man. As airbnb expands into new geographies, it would be interesting to look for the processes that they are putting in place between airbnb and the hosts to govern the relationship and oversee the operations part in a way that guarantees a consistent experience and a premium service for the end users.
I totally agree with you, you can’t submit a strategy and implementation proposals at the same time. The first proposal that gets submitted do not included the specifics of the implementation work. It mainly shows the capabilities that the PWC network has on the implementation side. Should the recommendations require such type of services, a detailed proposal focusing on a specific implementation area will follow the strategy project. hope this answers your question