LGST220 International Business Ethics

Answer 1

Constitutional Monarchy Prevails in Sweden, reflecting on the balance of power by the state and federal government. The ideology of solving the global challenges and competition affirms the selection of global product division structure for IKEA. Under this structure, the officers would be in charge of outsourcing the operations to the external environment (Kourula, Pisani & Kolk, 2017). This structure is beneficial in terms of indulging into partnerships, which is effective for sharing the risks and cost efficiency pressures. Joint ventures are also productive for IKEA reduce the duplication in the form of threat of substitutes in the host countries, which can add threats into the stability into the market position in the domestic (Sweden) as well as foreign markets.  

Answer 2

Formal external institutions make use of the governmental frameworks, which adds legality into the operations of the MNEs like that of IKEA in Sweden. This formality is effective in terms of enhancing the public relations through the provision of financial aid and assistance from the government. Informal institutions deal with the operations of the home and host countries. Both the formal and information institutions are effective for MNEs like IKEA, concentrating on the improvising of the internal operations network for attaining flexibility into the market position in the host country.  Institution based view of IKEA is subjected to multinational strategy, structure and learning, enhancing the preconceived views and notions on internationalization. Meyer, (2017) is of the view that this learning is inclined towards maintenance of workplace culture. Cross culture communications are conducted with the representatives of the foreign market institutions, reflecting the exchange of aids and assistances for globalization. In the process of the internal infrastructural development, the assistance of external institutional are adopted by IKEA, as it consists of frameworks, which makes the expansion of triple bottom line fruitful. In this context, resource-based view is relevant, paving the way for enhancement of customer value proposition, one of the effective aspects for adding flexibility into globalization.

Answer 3

Arrogance and constitutional monarchy are the negative vibes, which obstructs the globalization process for IKEA. Uneven spread of population is an addition to the complexities. Joint venture with the formal institutions of Sweden with constructive business plans, would convince the constitution about the globalization through strategies like exporting (Kourula, Pisani & Kolk, 2017). These strategies are fruitful in terms of sharing the risks and costs, enhancing the public relations.

References

Kourula, A., Pisani, N., & Kolk, A. (2017). Corporate sustainability and inclusive development: highlights from international business and management research. Current opinion in environmental sustainability, 24, 14-18. [https://doi.org/10.1016/j.cosust.2017.01.003]

Meyer, K. E. (2017). International business in an era of anti-globalization. Multinational Business Review. [https://www.emerald.com/insight/content/doi/10.1108/MBR-03-2017-0017/full/html]

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