This is a supplement to the case ES1691, which is basically afour-part case series which can be used to discuss business ethics, compliance/governance, integrity direction, reacting to and preparing against corruption in the context of internationalization and permits to also briefly touching upon the problem of Corporate Social Responsibility (CSR). Instance (A) describes a challenge IKEA was facing, while trying to enter Russia in 2000. The business was preparing to start its first flagship store on the outskirts of Moscow, only the first of several endeavors that were planned. IKEA focused on promotion, but immediately faced a sudden complication although after significant investments in logistics and infrastructure. Its major ad campaign in Moscow Metro which was with the slogan "[e]very 10th European was made in one of our beds" and it was labeled as "tasteless".
IKEA had no choice but to quit the campaign as it "couldn't prove" the claim. Soon Lennart Dahlgren, the first general manager of IKEA in Russia must have realized that the unsuccessful ad campaign was going to be the least of his troubles: A few weeks before the planned launching, the local utility company decided not to provide their services for the shop if IKEA didn't pay a bribe. What should Lennart Dahlgren and IKEA do? Was there any choice to playing the game the manner that is Russian, and paying? The following instances (B), (C), and (D) describe IKEA's creative response to the challenges described in case (A), and then report about new challenges with alleged corruption within IKEA and in the legal environment. Lastly, the question arises as to if the question IKEA can be considered to have a social responsibility in order to fight the wrong on a societal level in order to create a base for its own operation in Russia.
PUBLICATION DATE: May 10, 2016 PRODUCT #: ES1711-PDF-ENG
This is just an excerpt. This case is about LEADERSHIP & MANAGING PEOPLE
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