Sustainable Global Value Chain: The Case of IKEA
Synopsis
The increasing global fragmentation of production and the rise in cross-border transactions highlight the significance of tracing and understanding global value chains (GVCs). Discussing sustainability in GVCs demands a thorough examination of their intricate components. The value chain (VC) framework may be used to depict and advance sustainable paths of companies. There is a research gap in exploring sustainability implementation in the GVCs since there is no academic consensus on the relevant theoretical framework. In this case study, we link the business model and the value chain frameworks to explore the strategic and operational aspects of creating value through sustainability in the GVC. Studying the good practices of IKEA’s sustainable business model and GVC, our case study aims to provide a systematic approach to identifying value creation through cost-efficiency and differentiation in various upstream and downstream activities of the company’s value chain. We have found that this approach can increase the depth of GVC sustainability due diligence, improving insight into sustainability as a driver of a company's competitive advantages.