The Social Architecture Of Ikea, A Multinational Furniture Company ( Mnc ) And Private Entity

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Executive Summary The world is constantly changing and businesses are becoming more global every day. The success of a company depends on global efficiency, local responsiveness, and worldwide coordination. This paper will focus on the social architecture of IKEA, a multinational furniture company (MNC) and private entity. As of 31 August, 2015, IKEA has operations in 43 countries that incudes stores and distribution centers (About the IKEA group, 2015). IKEA’s net income is up 31% and bigger than Target and Lowes. It has mastered the challenge of “selling high volumes of inventory at consistently low prices in different market places, languages, and cultures” (Kowitt, 2015). From the Human Resources (HR) perspective, several…show more content…
People are HR’s primary responsibility, and it is imperative that the HR processes be in compliance with government and local laws and keep up with the global mission and maintaining a competitive organization. This paper will explore the challenges that International Human Resource Managers (HRM) face when their company is globalized, such as that of IKEA. The research for this paper will include information from the following sources: DeVry online library Human Resource Management journals and other related articles found on the Google search engine. Company Profile IKEA was founded in Sweden in 1943 by 17-year-old Ingvar Kamprad, selling pens, wallets, picture frames, and jewelry. Ingvar introduced his self-assembly furniture designs, and flat packages in 1956. IKEA began to expand into the European market in 1974. The first IKEA store, in Budapest, Hungary was the first to be opened after the iron curtain was taken down in 1990 (Dijkman, 2009. P. 44). The store in Belaya Dacha, Moscow was built in 2005 and is one of 11 stores in Russia. Currently IKEA operates 345 stores in 42 countries (248 stores are in Europe) (IKEA, n.d.). IKEA is a not-for-profit entity, and any profits are reinvested in its social enterprise activities. It is a company built on Swedish origins, low cost, simple and affordable products. This is one of the ways IKEA stays in front of

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