IKEA's Global Sourcing Challenge Indian Rugs and Child Labour Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

IKEA's Global Sourcing Challenge Indian Rugs and Child Labour Case Study Solution

Response to German producers on Video Program:

In response to the invitation of German producers for IKEA, the invitation should need to be accepted. The first foremost thing to consider is that the documentary is made by a German company. However, it is not mandatory to accept the invitation and be part of the live conversation but it is of crucial importance. As it provides Barner to have live conversation during on-air programming. It generates a probability to give better explanation of their concerns about their relationship with India. Specifically, Barner can possibly demonstrate her thought of mind with a clear justification letting people know that for her it is more important to be more concerned about the IKEA reputation as she is only responsible for this. It is important to eradicate the criteria of child labour but this can possibly not done by stopping business links with their partner companies which involve the trend of child labour. This perception of Barner might help her in maintaining IKEA clear reflection and may also lead to stronger relationship of the companies. It also provides IKEA to aware the German producers to fight against the child labour.

As the German Producers had only offered IKEA to view some of the shots from their documentary. They should be requested to let them watch the whole movie instead of some shots which shows certainly an unclear image of the fact. This might be the strategy of German producers to prove themselves right against the allegation but leaving IKEA behind full of doubts about their relationship with the companies of India on the issue of child labour.

On the contrary, the IKEA has been positively portrayed about the issue of Child labour when the problem was initially put up by the Swedish Television. There are a set of information on child labour by IKEA which was significantly collected by ILO and UNICEF. This information truly demonstrates the same viewpoint as same as that of the documentary makers. This will let the producers to perplex about the problematic issue by clear representation of child help during their labour at the manufacturing industries.

As the television industry has great potential to show false news as the truth by their excellent ability to modify any lie into a truth and makes people believe on it without any doubts. Therefore, it seems quite impossible for Barnerto assess the documentary before the session. As the German producers refused to show their documentary to IKEA before it is telecasted simply indicates there evil intention of point the finger at someone and their relationships with IKEA possibly. There may a strong contradiction that the IKEA is fearlessly engaged with an organization which uses child as their labour and continue their relations to earn revenues with the suppliers while being aware of the fact.

Furthermore, Barner has a strong point of justification which is their philosophical statement i.e. everyone makes mistakes but one takes its responsibility. The responsibility of the mistakes taken by anyone is considered as the best source of pride.Despite of the fact that IKEA was not aware about the growing concern over the child labour as well as the involving child’s as labours by the industries, the suppliers of the IKEA. During the acceptance of contract, IKEA started investigation against its supplier industries around the world. The management of IKEA is not afraid of accepting its mistakes if shown in the documentary by German producers. It will accept its mistake and take measure to put it right again.

Barner can also come up with another justification on the inefficient responsibility over social concerns. It is intending to be involved with the social concerns but has not taken such measures yet. In the field of marketing, IKEA is on top with excellent ideas as well as its eye-catching products.

The concerns of the IKEA is towards leading long term relationships with its network of distribution globally. IKEA is not recently involved in any of the social activities about the rights and concerns of each individual working in the industries and earning them a handsome profit. In future, IKEA will plan to be part of responsibility over the social concerns.

Hence, it can be concluded that as per the concern for the company’s reputation and share of share should accept the invitation and present it valid thoughts only in case if everything in documentary is against the IKEA. Specifically, IKEA had started a Foundation based on the principle of protecting rights of child labour and to provide them with free environment to educate themselves.

Actions on Supply contract with Rangan Exports:

Under the IKEA concerns about the most strategic and rational technique in reference to the child labour problem should provide Rangan Exports with another chance to assist them in overcoming this dilemma.

IKEA needs to take some measures in order to determine of the truth. If the proof against the Rangan export is true thus leading it in the failure on the moral level which were outlaid by IKEA. This clearly indicates that on IKEA, the supplier industry resulting in contravention on the child labour issue.

Subsequently, IKEA works with a vision of creating better lifestyle for every individual which is a strong representation for the enterprises to stand for the rights of workers of Rangan Exports. The concept of child labour does not involve a single company as a vast network of companies are responsible in putting it ahead. This is one of the most critical issue of social concerns and it would be injustice to blame a single one.

Barner can consider two alternatives to resolve this issue. At first, either termination of the contract with the Rangan Expors on the basis of involving child labour to work after the investigations to be sure about the fact. If the management of IKEA not decides for the contract termination, this brings a threat of losing brand position and reputation. This might result in the financial decline state of IKEA by decreased ratio of sale, less popularity of the brand and the concerns over social responsibilities. As it is surely not supported by the inhabitants if any country to include child labour. This substitute is legal and reliable with the policy of IKEA. The main drawback of this substitute is the IKEA deprivation with a worthwhile association and may result in the terminating relations with the sources of rug by India.

The second alternative is to warn the supplier industry with continuation of the links with a promise to let not do this mistake again and surely inhibit the child labour. This will help in maintenance of the healthy association between the supplier and the IKEA. This also provides a chance to better teach the suppliers about the drawbacks of the child labour. However, this decision is made on the basis of IKEA’s self-created policy. This makes obvious for the all suppliers that IKEA is strictly against the child labour and truly condemn it. This may have a bad impact on the market reputation of IKEA by the generation of false publicity.

As it is for the second time that IKEA became a victim of child labour which has greatly damaged its reputation. For this purpose, Barner should pursue the help by ILO and UNICEF as well as NGOs which may assist Rangan in escaping the need to used child labour for the rugs manufacturing. It may choose to spread awareness among the residents globally about the social concerns and how one’s life is influenced by in terms of social, and ethical values.

IKEA by the adoption of first alternative, terminates its relationship with the supplier violation. If results in the failure then portray a bad impact on all suppliers by the increased power of bargaining and the violation of the policy of IKEA. Moreover, it can make a charge for the behaviour which is not ethically right. Thus, Barner should make the decision of disuniting with Rangan public. The press should be called upon for the announcement of their decision with its reason with the summarization of the policy of IKEA on the use labour of child. She should report all the whole scenario of the issue emerged and be sure that all the suppliers are strictly following the rules of the contract. If any of the supplier found in compliance to exploitation of any of the contract rule offering labour of child should be fired.

In sum, the company can maintain its reputation in the market and somehow can bear the loss created by one supplier. With the stable reputation in the market, IKEA will surely cover up its financial crisis within a short period of time...........

This is just a sample partical work. Please place the order on the website to get your own originally done case solution.