Ikea Internalization
Stakeholder management in a multicultural environment.
A case-study of a global retailer entering the Russian Market.
Authors:
Dinara Izmaylova Federica Zuccon
Supervisor: Nils Wålhin
Student Umeå School of Business Autumn semester 2010 Master thesis, one-year, 15 hp
DEDICATION
"When we consider a new project, we really study it... not just the surface idea, but everything about it" Thomas, F and Johnston, O, 1981: The Illusion of Life. Italy: Walt Disney Production
To my father Gianfranco who made all of this possible. Thanks for the support you provided to achieve this important goal! I also express my deepest gratitude to my mother and all my family for their unconditional love, trust and encouragement. Federica Zuccon
To my beloved parents: thanks for your support and inspiration! Thanks also to all my friends and boyfriend for your warmth and love! Dinara Izmaylova
ii
ABSTRACT Nowadays, an increasing number of global retailers such as IKEA, Carrefour and Auchan, are expanding their business internationally: internationalization is seen as a way to face competitors as well as to enhance position on the market. In particular, emerging markets are becoming a fertile field for investing resources due to their fast economic development and growing disposable income of the local population. A number of market actors (or stakeholders) affect or are affected by the internationalization process, and therefore stakeholder management determines its success to a large extent. Thus, stakeholder management competences are becoming increasingly important in today’s business world. Our study addresses stakeholder management strategy applied by a Swedish global retailer (IKEA) when internationalizing to the Russian market. We also try to identify the main cultural differences between the focal organization and the Russian stakeholders, and the way in which the company faces and overcomes those diversities. Thus, we first give a brief overview of
A case-study of a global retailer entering the Russian Market.
Authors:
Dinara Izmaylova Federica Zuccon
Supervisor: Nils Wålhin
Student Umeå School of Business Autumn semester 2010 Master thesis, one-year, 15 hp
DEDICATION
"When we consider a new project, we really study it... not just the surface idea, but everything about it" Thomas, F and Johnston, O, 1981: The Illusion of Life. Italy: Walt Disney Production
To my father Gianfranco who made all of this possible. Thanks for the support you provided to achieve this important goal! I also express my deepest gratitude to my mother and all my family for their unconditional love, trust and encouragement. Federica Zuccon
To my beloved parents: thanks for your support and inspiration! Thanks also to all my friends and boyfriend for your warmth and love! Dinara Izmaylova
ii
ABSTRACT Nowadays, an increasing number of global retailers such as IKEA, Carrefour and Auchan, are expanding their business internationally: internationalization is seen as a way to face competitors as well as to enhance position on the market. In particular, emerging markets are becoming a fertile field for investing resources due to their fast economic development and growing disposable income of the local population. A number of market actors (or stakeholders) affect or are affected by the internationalization process, and therefore stakeholder management determines its success to a large extent. Thus, stakeholder management competences are becoming increasingly important in today’s business world. Our study addresses stakeholder management strategy applied by a Swedish global retailer (IKEA) when internationalizing to the Russian market. We also try to identify the main cultural differences between the focal organization and the Russian stakeholders, and the way in which the company faces and overcomes those diversities. Thus, we first give a brief overview of