Cross-cultural and diversity issues

1. Cross-cultural and diversity issues Group X Igamberdieva Inobat Kalko Olga Mifkova Veronika Moravova Barbora Shamota Liudmila

2. IKEA • Founded in Sweden • Furniture distributor with worldwide presence • Offers furniture of decent quality with no delays in delivery • Many of IKEA’s innovations have become industry standards ( logistics, cash & carry system, catalogues) • Unique product design capabilities • Unprecedented loyalty among its customers and employees • Vertical integration as a competitive advantage • The “IKEA Way” – doing things differently

3. The IKEA Way • Balance between the optimal product design for low prices and suppliers need for profit through efficiency and long production runs • Balance of strategic sourcing and marketing mix • Specific design with universal appeal throughout the markets of the world • Flexible in establishing parameters for international offices, but strongly sticking to Swedish cultural roots • “Learning by doing” • Informal, open and caring management style (hierarchy is not emphasized)

4. IKEA’s Swedish management style • Egalitarian management style - strong preferences for informal relations regardless nationality • Swedish managers are ambassadors of “IKEA’s mission” who help international coworkers understand the uniqueness and the nature of the company • IKEA’s managers welcome participation in making decisions and taking responsibility by the employees of the company

5. IKEA in the world Source: http://upload.wikimedia.org/wikipedia/commons/thumb/a/a1/IKEA-map.png/800px-IKEA-map.png

6. IKEA in Germany • The largest national organisation in the IKEA group • Germans prefer precisely defined rules and instructions to “taking on responsibilities for yourself” • Seeing the Swedish management as more target-oriented, not sufficiently assessing risks before taking actions • Formal procedures and administration provide Germans with security.

7. IKEA in USA • Different attitude of Swedish and American workers towards the emotions on the workplaces • Cultural differences and emphasis on being Swedish made IKEA too complicated and difficult to adapt for Americans • Americans expect managers to tell them what to do and to take responsibility for decision making • American style implies detailed analysis of individual strengths and weaknesses, not shared by Swedish managers • IKEA is considered to be more employee-oriented than average American employers

8. IKEA in Russia • Necessity of hierarchy and strictly defined framework • Adapting to Swedish style faced a lot of obstacles (motivation, making decision procedure, etc.) • Russian way of employing people: emphases on diplomas and degrees rather than on specific personal qualities (Swedish style)

9. Problems and solutions • Swedish style can’t be implemented globally  it should be more flexible to local features. • Career ladder should be more opened for nationalities different from Swedish • “You can’t be in a hurry to move up the ladder” approach is not acceptable across all international offices of IKEA. It demotivates people.  special award system should be created for the prominent employees.

10. Problems and solutions • IKEA provides its employees with possibilities to participate in daily decisions and take responsibility, that gives them a feeling of being important within the company. However, IKEA doesn’t offer enough opportunities for personal growth.  personal inputs of employees shouldn’t be undervalued (work experience, successfully implemented innovations and decisions offered by individual, etc.)

11. Thank You for Your attention!!! Questions, please!!!

12. References • P. Grol, C. Schoch: IKEA: Managing Cultural Diversity. Centre of Perfektionnement aux Affaires, Paris, France, 1997 • http://upload.wikimedia.org/wikipedia/commons/thumb/a/a1/IKEA-map.png/800px-IKEA-map.png • The IKEA Way http://www.theikeaway.ca/en/wwd.html