Corporate Diplomacy: IKEA and the Russian Market A Communication Strategy of Multinationals in Relation to Host Governments Corruption in the Russian Market One of the main issues IKEA faced when it attempted to get into the Russian market was corruption (Heath, 2010)
Corporate Diplomacy: IKEA and the Russian Market A Communication Strategy of Multinationals in Relation to Host Governments Corruption in the Russian Market One of the main issues IKEA faced when it attempted to get into the Russian market was corruption (Heath, 2010)
Corporate Diplomacy: IKEA and the Russian Market A Communication Strategy of Multinationals in Relation to Host Governments Corruption in the Russian Market One of the main issues IKEA faced when it attempted to get into the Russian market was corruption (Heath, 2010)
If Russia needs to work on its business diplomacy in order to attract more companies, than the companies and corporations that want to do business with Russia should also practice diplomacy. When companies are diplomatic, they can accomplish much more and often create better deals that are highly beneficial to both parties (Henisz, 2014)
While corporate diplomacy is not always easy, it is very important to the success of a developing business. Being diplomatic with people one is used to is far different than working with a different country on something as important as a large corporate venture (Jablin & Putnam, 2001)
Fortunately, it can also be easy to make it up in other areas, and some mistakes are bound to happen. Working with Russia, though, can require stronger levels of corporate diplomacy than what would commonly be seen, because the government and officials there are very different from what is seen in Western countries and throughout much of Europe and Asia (Khattab, Anchor, & Davies, 2007)
IKEA refused, and rented generators that ran on diesel and would power their store. It was not long until the power was turned on, without the bribe (Kramer, 2009)
Every company, just like every person, had a point at which they draw the line and will go no further, even if that stops the negotiations. By knowing in advance where that line is, and determining if there is any "wiggle room" to move the line or make adjustments, a corporation can be sure about what it is doing when it moves into a new country and can still keep to the core beliefs it holds (L'Etang & Pieczka, 2006)
When that happens, tensions and start and people can become defensive, even though there was nothing that either party should have really gotten upset about. Not only is that frustrating, but it can signal the end of negotiations, even if the two parties would have otherwise been likely to agree (Leonard, Stead, & Smewing, 2002)
Corporate Diplomacy: IKEA and the Russian Market A Communication Strategy of Multinationals in Relation to Host Governments Corruption in the Russian Market One of the main issues IKEA faced when it attempted to get into the Russian market was corruption (Heath, 2010). Because of the level at which that corruption took place, IKEA publicly rallied against it in an effort to change some of the problems that appeared to be so inherent in Russia's political system (Meyer, 2011)
Strategic Management Among the many ways companies like IKEA can be successful in markets like Russia is through strategic management. Having a strategy is important, but so is knowing when to adjust that strategy and try something new because things are not working quite the way they were planned or expected to (Moss, 2002)
Additionally, many companies are not completely aware of what goes on in the business world of another country until those companies attempt to move into that country and find that they are hitting road blocks because they do not do things the same way the country does (Salacuse, 1999). That is not the case with all companies and all countries, but it is a relatively common issue that has to be faced by most corporations that decide they want to work with other countries (Stephens, Malone, & Bailey, 2005)
Even a heated debate can leave people feeling as though they no longer want to do business with one another, when before they felt as though they would have worked well together (Abrahamson & Eisenman, 1999). It is no secret that the policies and procedures required to get a company up and running in the Russian market can be frustrating, but a high level of diplomacy can go a very long way toward helping companies get into that market and have a level of success that they might not have otherwise seen (Tse, 2010)
This has been seen for many years, and it does not look as though anything about it will be changing anytime soon. Part of the reason for the lack of change is that Russia has never been a country that is big on making changes, and part of the reason is that the country does not seem to have a desire to become "Western" in the way many other countries have (Wood, 2011)
IKEA Case Study How has the globalization of markets benefited IKEA? Market globalization has benefited IKEA from a branding (Tarnovskaya, Elg, Burt, 2008), supply chain and sourcing (Ghauri, Veronika Tarnovskaya, Elg, 2008) and differentiated product design perspective (Roncha, 2008)
The processes of preparing budgets on an annual basis have been time-consuming and cumbersome while adding minimal value and preventing managers from reacting to the rapid changes in the modern business environment. The conventional methods of preparing budgets have mainly focused on fixed targets and performance rewards that often contribute to unethical and dysfunctional management behavior (Hope & Fraser, 2003)
The established new program acted as one of the major MRP concepts in the organization. IKEA not only developed but also implemented a new global planning concept for its business operations (Jonsson, Rudberg & Holmberg, 2008)
These studies also quantify the fact that the greater the level of trust a transformational leader has earned through service to their teams the higher the overall performance as well (Rafaeli & Worline, 2001). A highly effective transformational leader also has the ability to create a level of emotional stability in their terms and see their role as one of stabilizing force of the highs and lows that inevitably occur in the pursuit of long-term objectives (Bass & Avolio, 1993; Shamir, 1992; Yukl, 1989)
These studies also quantify the fact that the greater the level of trust a transformational leader has earned through service to their teams the higher the overall performance as well (Rafaeli & Worline, 2001). A highly effective transformational leader also has the ability to create a level of emotional stability in their terms and see their role as one of stabilizing force of the highs and lows that inevitably occur in the pursuit of long-term objectives (Bass & Avolio, 1993; Shamir, 1992; Yukl, 1989)
These studies also quantify the fact that the greater the level of trust a transformational leader has earned through service to their teams the higher the overall performance as well (Rafaeli & Worline, 2001). A highly effective transformational leader also has the ability to create a level of emotional stability in their terms and see their role as one of stabilizing force of the highs and lows that inevitably occur in the pursuit of long-term objectives (Bass & Avolio, 1993; Shamir, 1992; Yukl, 1989)