Worldcrunch is a new global news service that for the first time delivers the best foreign-language journalism in English. SWEDEN – Sagas are epic tales full of symbolic details, and the IKEA saga is no exception.
The story of the Swedish furniture giant, founded in 1943 by Ingvar Kamprad, who is now 86 years old, definitely qualifies as a saga. It combines successes, setbacks and the carefully maintained mythology around the patriarch, who even though he is still active has taken a step back since he resigned as CEO in 1986. Today his role in the company is mostly advisory, but he still chairs the Kamprad family foundations.
As he hands the reigns of the company down to the next generation – his three sons – questions arise on the issue of IKEA’s sustainability, and Kamprad’s legacy.
In Helsingborg, where IKEA’s Swedish headquarters are located, Jeanette Skjelmose, in charge of sustainable development, praises Ingvar Kamprad and his intimate knowledge of the group’s every little detail. “It is not uncommon to see him here.” Immediately, Ylva Magnusson, head of communications says nonchalantly: “He is no longer in control, his role is to advise.” “I saw him recently during an IKEA store visit in Amsterdam,” says Skjelmose. “But he visits less and less,” adds Magnusson.
The head of communications is firmly intent on getting the message out that Ingvar Kamprad, the patriarch, is no longer in command of the company. She wants to make it clear that he is no longer indispensable to the smooth running of IKEA. In January, the company announced an annual profit of 3.2 billion euros, an 8% increase in this post-Kamprad era.
Getting things wrong, making mistakes is part of Kamprad’s nine commandments. In 70 years, his company has not been spared embarrassing revelations: child labour, secret foundations with billions of euros stashed in tax havens, destruction of primitive or protected forests, forced labour from political prisoners in East Germany, corruption in Russia, Ingvar Kamprad’s Nazi past in the 1940s and 1950s, spying on employees in France. The list is long – and not complete. Some of these mistakes are directly attributable to Kamprad himself, and he has always gotten off the hook by making light of his weaknesses.
Kamprad has sometimes been IKEA’s worst enemy, but he was also its essence. Behind the scenes, IKEA’s executives must manage this paradox – using his image wisely, minimising his presence, and only keeping his brilliance. No one disputes the old man’s business skills or his encyclopedic memory. Equally legendary is his stinginess and the fact that he sometimes acts like a simpleton.
“I have enough money to get by, he said, but the fact is that it is not me who has the money, it’s the foundation.” Don’t tell him he is Sweden’s richest man.
Johan Stenebo, one of IKEA’s top executives for 20 years, including three as Kamprad’s right hand man, says that he does not know anyone smarter. Stenebo, who wrote a book called “The Truth about IKEA: How IKEA Built Its Global Furniture Brand,” after resigning from his job after an argument with the Kamprad sons, says “Ingvar Scrooge,” as some call him, has developed a particular skill for dodging issues.
“When he is not around reporters, he never speaks about his problems,” says Johan Stenebo. “With the media, he uses his personal problems as a smokescreen,” for instance his struggles with alcohol. Swedish people, who admire his success, have always forgiven him because he doesn’t have the arrogance of other business leaders. He is always repentant and reserved, which helps a lot.
IKEA, the next generation
“One wonders what will happen when Kamprad’s gone?” asks Susanne Sweet, an expert on corporate responsibility at the Stockholm School of Economics. “Because the image of this farm boy from Smaland (Sweden’s southern province) – hardworking, thrifty, with all this mythology around him, close to the common folk… the Kamprad sons, who grew up in a very different world, don’t represent that at all. Do they have any of the same values of their father?”
A photo illustrates perfectly the difficult question of IKEA’s succession. The photo was taken in 1998, during the traditional Christmas speech that Kamprad gives every year to the employees from the Almhult IKEA store. Kamprad, who is sitting on stage, is looking at his eldest son Peter, who is making the speech for the first time. Kamprad looks worried, while Peter looks absolutely terrified, giving his speech under the watchful and inquisitive eye of the patriarch. Would Peter be the one to take over the reigns of this global giant, with more than 150,000 employees? Would Peter and his brothers be up to the task? Kamprad has done nothing to make it easy for them.
The photo was published in Aug. 2002, by the newspaper Smalandspost, with the headline: “Kramprad’s three sons take over IKEA.” The article, written by Bosse Vikingson, a reporter who had at the time already been following the IKEA saga for 15 years, sheds light on one of the mysteries of this discrete empire – life after Ingvar. The order of succession between the founder’s three sons finally seemed to be clarified. It was Peter Kamprad, who was 38 years old in 2002, who would succeed his father, according to the article. He would head the Stitching Ingka Foundation, the Dutch-registered foundation who owns Ingka Holding, the parent company for IKEA stores. His two brothers, Jonas and Mathias would also be a part of the adventure, Jonas on the design side and Mathias on the entrepreneurial side.
Putting on a show
A smooth succession? Not so sure. It was clear that none of the three sons would take on their father’s omniscient role. Kamprad feared that his sons would one day tear each other apart. “I do not want my sons to compete against each other for the right to head the company. Sooner or later, I will have to name one,” he said in 1998. Since he started talking about his succession in the late 1970s, he has been planning things so that IKEA doesn’t end up on the chopping blocks after his death, because of inheritance problems.
“Peter Kemprad’s Christmas speech to IKEA employees was a harbinger sign” wrote Bosse Vikingson. Fifteen years after that photo, what has happened? One of Ingvar Kamprad’s last photos is from Autumn 2012, when the historic Almhult store was re-opened after its refurbishment. We see Kamprad shaking a few hands, smiling, but tightly controlled by a squad of collaborators. “He is old now,” says Vikingson. “IKEA executives make sure he doesn’t do too much, even if they cannot really tell him what to do.”
For Christmas 2012, though, it was Kamprad who went up on stage to make his annual speech. Since that fated 1998 photo, Peter has never given another Christmas speech. The three brothers rarely appear in public, and when they do, it is strictly orchestrated. When they talk to journalists, the do not talk about themselves. In fact, they have only been interviewed once, for a book that was approved by Ingvar Kamprad. The three brothers are interviewed together, and we never find out who says what.
For tax purposes
For three and a half years, the spokesman for the father and his three sons is a Norwegian man called Per Heggenes. He tells Le Monde that all three sons have quit their operational roles in IKEA. So Peter will not become the head of the company. All three sons have made it clear that they want to work for the foundations. “But they do not only sit for board meetings,” says Per Heggenes. “Their role is to ensure that IKEA’s culture and philosophy are transferred to the next generation.”
Officially, the division of roles was made according to each brother’s interests and character. Jonas is the creative type. He trained as a designer and is interested in product development. Mathias, who is more business oriented, is interested in the global concept of the company. Peter, the economist, helped develop the Ikano bank, created by his father, and has decided to stay there.
“They prefer it this way, because it gives them the necessary distance to keep an eye on what is happening and make sure that the basic principles that made IKEA into the success it is are being followed,” says Heggenes. “Everything has been done to make sure IKEA lives on forever.”
In reality, this complex construction is just destined for tax purposes – and ensure the survival of IKEA after its founder’s death – even in the case of a disagreement between his sons.
This story was originally published by WorldCrunch.
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