Hbr Ikea Case

Topics: Contract, Industrial Revolution, Economics Pages: 3 (958 words) Published: March 11, 2013
HBR: Ikea

I feel that Mrs. Barner should cut the contract and walk away from the company. As stated in the paper the Indian government does not enforce the laws protecting the citizens from labor issues. I feel this is ingrained in their culture, and has been this way for hundreds of years. There is not a guarantee that is will stop in the long term, which will lead them, to be in the news yet again. Ikea claims that they visited the facility and did not see signs of poor working condition, or too young of children. Unless the company had a sustainable process to send personal employees from headquarters over to India a few random times a month I don’t see how sewing a tab would give them confidence that the company will have no child labor issues. I feel two thing can be done. One they easily could buy from another country, and even a different buyer in India, but they need to start fresh. I would scout out a new producer. I would make a very specific contract with them. I would even say a struggling business or fresh entrepreneur. Either of these two would be more than happy to make a name for them selves and to be fulfilling the orders of Ikea. I would work closely with them for the first years or so, almost like a subsidiary and get them going. My second choice would be to have vertical integration and mass produce a variety of rugs anywhere from Mexico, Pakistan, Turkey, or Twain. There are other locations that would be just as affordable as India. Also once opening the manufacturing plant, this could lead to new opportunities. I think the company with the amount of revenue it does have to take chances should do just that. I would try finding a new rising star who wants nothing more than to prove themselves inn there industry and to make a profit to live a good life, give someone a chance in life that they would never have otherwise, properly mentor them and you will have a loyal opportunity to have molded a partner I don’t think they...
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