Ikea

 

With reference to an organization of your choice, examine the impact of culture on organizational ethics. (20) Introduction   Ikea was founded by Ingvar Kamprand in Agunnaryd, Sweden in 1943. Ikea is a Swedish multinational furniture manufacture and retailer     Selling low-priced furniture that customers assemble themselves. Ikea has a reputation for upholding high ethical standards   Ikea has an ethical code of conduct (IWAY) which the proper practice for suppliers for environmental and social issues, and forestry regulations. However, as a company that is continually expanding in different countries, it faces problems such as   clash of culture, and it must make decisions on whether it needs to maintain its organization ethics. This is shown on the way it approaches the cultural differences in Russia and India.   Culture- Culture is the values, beliefs and norms of an organisation, country or other social grouping. Ethics- Ethics are the socially accepted moral principles that guide decision making, based on the collective belief of what is right and what is wrong. Body Paragraphs In February 2010, Ikea fired two of its executives working in Russia, Per Kaufman and Stefan Gross, for engaging in corrupt business practices with suppliers to its St. Pertersburg store. Kaufman and Gross paid bribes to an energy company to ensure that the store would have power. This case explores a conflict between an ethical corporate culture and a corrupt political culture. Russian political culture is considered in the sense that it permits bribery. Russian government officials insisted that Ikea could not do business unless it paid them bribes. Ikea avoids doing business in Russia to maintain its high ethical standards and its cultural beliefs, harming its profit making interests. From Russia’s point of view:  view:   • bribery reinforces trust and loyalty and builds strong relationships between business partners.   However, this explicitly opposes IKEA’s corporate values. values.   Stakeholders Customers • bribery makes goods and services more expensive than they should be  be   • inefficient way of accomplishing business, a society free from corruption creates more goods and services than one Russian government and citizens The Ikea disagreement has serious business consequence. if ikea employees and russian government officials cannot reach accord about what ethical norms are to govern their relationship, ikea will be unable to extend its business in Russia. Russia will be unable to benefit from the tax revenue levied on Ikea's profits and Russian citizens will be unable to benefit from the utility of Ikea's products.

In India, as many as 200,000 children are employed in the carpet industry, and these factories have quite possibly become subcontractors of suppliers of Ikea. IKEA needs to face various challenges in terms of business practices, socio-economic and political conditions, as well as its unique culture in Chinese market. Chinese people from different regions may exhibit distinct characteristics as well. Taking the language for example, the spoken language varies greatly from region to

 

region. It is not surprised that someone from Shanghai cannot understand residents r esidents of Guangdong province, if without special study of Cantonese. Child labor in India

Conclusion

To what extent has strategy affected ethics using a company of your choice? Ikea was founded by Ingvar Kamprand in Afunnaryd, Sweden in 1943. Ikea is a Swedish multinational furniture manufacturer and retailer, which sells low-priced furniture that customers assemble themselves. -term goals. On the other hand, Ethics is often Strategy is about devising plans to achieve an organisation’s long long-term referred to as the socially accepted moral principles that guide decision making, based on the collective belief of what is right and what is wrong. Ikea’s Ikea ’s strategy  strategy is to expand globally whilst maintaining sustainability. This strategy has impacted the organizational ethics of the firm, as Ikea has developed an ethical code of conduct (IWAY) with the proper practice for workers, suppliers, environmental and social issues, and forestry regulations. In February 2010, Ikea fired two of its executives working in Russia, Per Kaufman and Stefan Gross, for engaging in corrupt business practices with suppliers to its St. Pertersburg store. Kaufman and Gross paid bribes to an energy company to ensure that the store would have power. This case explores a conflict between an ethical corporate culture and a corrupt political culture. Russian political culture is considered in the sense that it permits bribery. Russian government officials insisted that Ikea could not do business unless it paid them bribes. Ikea avoids doing business in Russia to maintain its high ethical standards and its cultural beliefs, harming its profit-making interests. From Russia’s point of view: view:   • bribery reinforces trust and loyalty and builds strong relationships between business partners. partners.     However, this explicitly opposes IKEA’s corporate values. values.  

CSR