How Ikea Manages Cultural Issues in China Operations

Topics: Culture, Management, Sociology Pages: 5 (1529 words) Published: January 10, 2013
How IKEA Manages Cultural Issues in China Operations
January 4, 2013 21:18

Individualism vs. Collectivism
            Countries categorized as individualistic are characterized by the “I” cultures. Such societies expect its members to take care of themselves and immediate families. Whereas success in individualistic societies brings pride and stature, failure brings the feeling of guilt and in most cases leads to loss of self-respect. It is for this reason that individualistic societies value tasks than relationships. Collective societies, on the other hand, are synonymous with the “We” culture. In such societies, one’s welfare alone is not sufficient, but the entire society’s well being. Collective societies coexist in groups formed early in life and maintained throughout one’s life. These groups, usually consisting of friends, business partners, and extended family, provide protection to loyal members. In contrast to individualist societies where tasks are treasured than relationships, collective societies treasure relationship among members than tasks.             China’s IND score is 20, while that of Sweden is 71. This is a clear indication that Sweden is a more individualistic society than China. IKEA, while operating in both countries, has taken into consideration these cultural differences. According to Chaletanone and Cheancharadpong (2008), IKEA’s success in China is a result of sensitiveness to the country’s culture among other factors such as “psychic distance and learning, strategic decision making process, degree of adaptation of retail offer, entry strategy, characteristics of organization and management characteristics” (41). According to the researchers, China is a collective state where private and work lives are interwoven (Chaletanone and Cheancharadpong, 2008). IKEA’s management, baring this in mind, has put in place policies and strategies aimed at taping the advantages of collectivism, for instance, in marketing. IKEA’s advertisements in China use “more culturally congruent collectivistic appeals than culturally incongruent individualistic appeals” (Lin, Koroglu & Olson, 2012). China is strongly inclined towards selective application of rules and policies. Therefore, they tend to favor members of their groups in implementing rules and policies, resulting to nepotism and favoritism. IKEA, like many other businesses venturing in China, has labored to counter all aspects of nepotism and favoritism in the country by compelling its employees to respect its anti-nepotism policy requirements (Lee, 2003).             In Sweden, a country that is highly individualistic, IKEA’s operations have continued to reflect strict adherence to the nation’s cultural alignment. For instance, managers steer clear of employees’ private lives (O’Donnell & Boyle, 2008). Additionally, company rules are applied universally without any form of favoritism, which is typical of most nations with high IND. Canada, a country with IND of 80, considered to be in the range of that of Sweden, widely uses the same management style where managers do not interfere with employees’ private lives. The contrast, however, comes in the level of appreciation of employees’ private lives. An interview carried out by Silvia Iacuzzi, focusing on the management style of IKEA’s managers; found out that the managers occasionally organize family outings for employees to motivate them (IKEA mangers; personal communication). Masculinity vs. Femininity

            Masculinity and femininity are founded on the fundamental drivers of motivation. While those who are driven by a strong desire to be the best in what they do are masculine, those driven by liking what they do are feminine. Competition, success, and achievement drive masculine societies. On the other hand, quality of life one leads and caring for others, drive feminine societies.             In this dimension, Sweden scores five (5). This places it as a highly feminine society....
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