BoKlok’s Growth Strategy in 2018 and Beyond: Navigating External and Internal Contexts

By Robert Burgelman, Martin Fischer, Margot Sutherland
2019 | Case No. SM298B | Length 34 pgs.

Jonas Spangenberg, CEO of BoKlok, an entrepreneurial industrialized construction venture focused on providing low-cost housing to a sharply defined, relatively low-price market segment, must identify and manage forces within three contexts as he develops and guides BoKlok’s growth strategy: the residential construction industry, and Skanksa and IKEA, BoKlok’s parent companies.

Students are asked to consider Spangenberg’s strategic actions in relation to the external context—an industry beginning to feel the impact of information technologies (digitalization) in the design, manufacture and assembly phases of construction—and in relation to the company’s internal context: parent companies Skanska and IKEA. Organizationally, BoKlok was nested within Skanska, one of the top ten construction companies in the world, and was dependent on Skanska for BoKlok’s continued growth and development. Yet, historically, culturally, and from a brand perspective, BoKlok was patterned after IKEA, the low-cost furniture retailer.

Spangenberg’s most direct strategic challenges relate to fine-tuning BoKlok’s business strategy in light of industry turbulence and, with the support of Skanska, developing a strategy for entering the U.K. market, and preparing his organization for executing the U.K. strategy.

The first case can be used on its own to develop a deep understanding of the conditions that led to the founding of BoKlok and to clearly identify its novel business strategy and the success that it has been able to achieve by January 2018. The second case is set in September 2018, at the time that the Swedish housing market entered a downturn and BoKlok and parent company Skanska were dealing with the effects of contraction in their home market while preparing for BoKlok’s expansion into the United Kingdom.

Also see:  SM298A: BoKlok’s Housing for the Many People: On-the-Money Homes for Pinpointed Buyers

Learning Objective

Students are challenged to identify the strategic imperatives that arise from BoKlok’s external and internal contexts. Forces from the external context—technical, social, economic and competitive—buffet the company, as it strives to create value in the provision of low-cost housing. Forces from the company’s internal contexts have both disciplined and fueled the company’s recent impressive growth trajectory, but must be managed for BoKlok to sustain profitable growth and stay abreast of external challenges in an industry beginning to feel the impact of information technology.
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