Abstract
IKEA’s strategy adheres to the stakeholder principle by collaborating with local companies, adhering to a strict code of ethics, and boosting social expenditure. The stakeholder perspective possesses a huge influence on corporate operations. Most tax records of the top firms in the United States plus other industrialized countries incorporate some variation of the shareholder idea or phrase. The artwork’s popularity stems from a multinational drive toward more ethically conscious or sustainable corporate methods. Many businesses are increasingly embracing the notion and making concerted attempts to please their major stakeholders, but others may casually adopt the word “lip service” since it is economically popular. Therefore, this work emphasizes that IKEA should understand its stakeholders, including how to involve them in a competitive manner.
Introduction
This research investigates internationalization activities with a particular emphasis on IKEA stakeholder management since recent studies contend that stakeholder administration is essential for enterprise performance. Stakeholder theory defines the interdependence of the many players in the organization and proposes an alternate purpose for the company. More so, IKEA stakeholder management should be designed to provide techniques for managing various populations and connections. IKEA should comprehend its stakeholders and how to engage them competitively. Moreover, the Stakeholder model postulates the interdependence of the many players in the organization and proposes an alternate purpose for the enterprise (Ramakrishnan 2019). Stakeholder management is designed to provide techniques for managing various groups and connections. Relying on the methodological approach of James Emshoff, Richard Mason, and Ian Mitroff, Harrison et al. (2019) defined and refined the core aspects of this stakeholder idea. He follows the impacts of stakeholder conceptualizing through at least four primary management layers: An organizing notion within the Corporate Planning domain (Javed et al., 2020, p.1400), identifiable as shaping portions of Systems Theories; corporate social responsibility and organization theories.
A company cannot operate in a bubble. The following elements are always evident:
- Shareholders, workers, suppliers, consumers, investors, partners, rivals, and public actors are all cases of persons.
- The economic operations of a company entity are developed in a geographical region within a political, social, and economic framework.
Therefore, stakeholder theory might be categorized into three broad classes:
- The descriptive share of the stakeholder approach is engrossed with how executives and stakeholders conduct themselves, plus how they identify their conduct and accountabilities (Ramkrishnan, 2019). It represents and analyzes business affairs’ former, existing, and future situations and their stakeholders.
- Normative shareholder philosophy: The underlying moral ideas and their correlation create the normative framework for the shareholder concept. It aims to explain the institution’s role and propose instructions based on important moral or intellectual ideas.
- The functional stakeholder theory prescribes how administrators should operate to influence and run for their respective interests.
Literature Review
IKEA Stakeholder Sustainability Conflict Management
IKEA was started in Sweden almost six decades ago. Since then, it has expanded, becoming the largest furniture store globally. It has over 300 locations globally, total revenue of $27 billion, and 130 thousand workers. (Inter IKEA Systems, 2022) The firm’s focus has always been on promoting things at rock-bottom rates. An environmentally conscious corporate approach is becoming an excellent sustainable management plan in a universe where adapting to the ever-changing client marketplace is more important than doing anything you wish with your firm. IKEA participates in the High Ambition Alliance on Chemicals and Waste, a partnership of dedicated senior officials across the UN zone, multilateral organizations, industries, and the social community (Inter IKEA, 2022). Their goal is to create exposure, enforce commitments, and encourage effective chemicals and garbage management. Moreover, IKEA works with the World Business Council for Sustainable Development to promote wellness, the economy, and justice.
IKEA uses lobbying and networking widely as an international marketing strategy. Moreover, IKEA adopted the following methods to foster successful cooperation with its suppliers: Active participation in many aspects of the partner’s manufacturing, supply, and, in some instances, human resource development; participation of higher-level management in developing a supply chain and in-depth discussion of rules and expectations in compliance with the application of conduct codes. Moreover, IKEA partners with ISEAL Alliance, which employs business rules on a global scale to promote the anticipated line of conduct to its workers and stakeholders (Inter IKEA, 2022). For instance, the IWAY Ethics Code governs the general work environment at IKEA, like Fair-trade and Better Cotton Initiative. Others include banning coerced and contractual labor, plus child labor; reasonable operating hours, salaries, and bonuses; workplace health and safety; and the restriction of any form of prejudice or harassment (Inter IKEA, 2022). Thus, promoting effective stakeholder cooperation.
IKEA has a unique approach to employee recruiting, training, and reward. Because hiring is value-based, the firm is more concerned with a potential worker’s individual factors than her degree and job experience (Raha, Aveed, and Ilir Hajdini, 2022, p.162). For instance, job descriptions emphasize values over abilities, and applicants are asked value-related queries throughout the screening process to analyze their attitudes and behaviors. However, finding a positive economic connection with the monitoring-for-stakeholders strategy could be beneficial in quieting the shareholder proponents. However, guiding stakeholder corporates should be interested in the bigger perspective of the cumulative value of businesses that exercise this form of organization and in identifying the comprehensive framework for calculating the overall value a corporation creates.
Conclusion
Therefore, a stakeholder plan is necessary to provide techniques for managing various groups and connections. Therefore, companies should strategically analyze and manage the stakeholders. They must address three general queries concerning any stakeholder: who is the key player? This inquiry focuses on IKEA stakeholders’ characteristics: what do they want? This question explains IKEA’s stakeholder aspirations and; how they are going to acquire it. This query justifies the means used by a stakeholder.
Reference list
Harrison, J.S., Barney, J.B., Freeman, R.E. and Phillips, R.A. eds., 2019. The Cambridge handbook of stakeholder theory. Cambridge University Press.
Inter IKEA Systems, 2022. The history of IKEA. [Online] About.ikea.com.
Inter IKEA, 2022. Partners for our planet. [Online] About.ikea.com.
Javed, M., Rashid, M.A., Hussain, G., and Ali, H.Y., 2020. The effects of corporate social responsibility on corporate reputation and firm financial performance: The moderating role of responsible leadership. Corporate Social Responsibility and Environmental Management, 27(3), pp.1395-1409.
Raha, Aveed, and Ilir Hajdini. “Franchisees with multiple stakeholder roles: perceptions and conflict in franchise networks.” Journal of Strategic Marketing 30, no. 2 (2022): 160-179.
Ramakrishnan, D., 2019. Theories of stakeholder management. Available at SSRN 3535087.