Ikea Global Sourcing Challenge Essay

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Ikea Global Sourcing Challenge: Indian Rugs and Child Labor IKEA and Marianne Barner are facing a very challenging issue. Because they were blind sided by the child labor issues with their supplier, they had to scramble to respond to the issues in a quick and appropriate manner. IKEA sent a legal team to Geneva to seek input and advice from the International Labor Organization on how to deal with the problem and to find out more about the child labor issues. They also hired a third party agent to monitor child labor practices in India and Pakistan and to conduct random audits to ensure there were no children working. They had all their suppliers sign a legal document stating that if a supplier employed children under legal working…show more content…
Because their employees understand the culture they will be more comfortable in ambiguous situations and know how to choose the right decision and even if it is a difficult social or ethical decision they know the company will support them. IKEA also needs to teach employees to follow the business goals as well as the organization goals; they need to learn how to make sure they are tied together in the best possible way. Without the companies guidelines on code of conduct and possible limitations, the employee can end up being confused and not know how to make the best possible decisions. IKEA's corporate strategy comes directly from their vision statement "To create a better everyday life for the many people". There strategy was to provide a low cost product for their customer. In order to achieve this goal they had a management process that stressed simplicity and attention to detail, a willingness to assume responsibility and to help as evidenced by the formaldehyde and the child labor issues. Because of their willingness to admit fault, IKEA stepped up to the plate to try to monitor and maintain the relationship with their supplier. India is the largest purchasing source for carpets and rugs, because of this Barner did not initially feel she should just cancel the contract with the offending supplier. She researched the issue
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