Essay Writing Help on Case Study on IKEA and Child Labor

Case Study on IKEA and Child Labor

  1. IKEA should decline to send a representative during the broadcast of the documentary. This refusal should be based on grounds that they have not watched the video and prepared a proper rebuttal to the claims it makes about the company and their major supplier of carpets in India, Rangan Exports. The film as portrayed by the filmmaker and the still shots is antagonistic to the company and could be disastrous if aired. Marianne Barner, the business area manager, should insist on the filmmaker allowing the company to review the whole film and prepare adequately for a rebuttal. If the filmmaker cannot do this, then the company is better off preparing for a rebuttal after the airing of the documentary. Proper information is key to IKEA’s business, and it would be embarrassing to send a representative with insufficient data. The filmmaker could overwhelm the representatives with copious amounts of evidence and without proper responses, the public image of the company could dwindle and contribute to massive losses.
  2. Marianne Barner should take a more active role as regards to the supply contract with Rangan Exports. The culture and value system as established by the founder of IKEA, Ingvar Kamprad, states that the company has the family at heart. The corporation is focused on doing things differently and in the simplest way to achieve its objectives. If child labor is the norm in India, then such cannot be encouraged within IKEA, and that is the reason it should be discouraged. The area manager should explain its value system to the supplier and attach conditions to the agreement they have. The film will create a negative image of the corporation; this is sufficient ground for Marianne Barner to announce that it has stopped undertaking business with the supplier. Business between the two can only be resumed when  Rangan Exports abides by IKEA’s conditions and the UN conventions on Children’s rights. Another reason this action is warranted is that the company refuses to terminate child labor. Thismeans that the enterprise recognizes children as legal workers and cannot be terminated on the basis of being children alone. Such analogy cannot be encouraged, and the business needs to alienate itself with any supplier that promotes child labor.
  3. IKEA is focused towards growth in novice markets so as to grow into a reputable global company that has its stores located in every corner of the world. India is an important market for this growth, and the company should not exit from its operation in India. The company has an operational advantage where Indian rugs only contribute a paltry amount to IKEA’s turnover. The cost of continued operations with suppliers that do not shun child labor poses too much risk to global business, and that is why it needs to stop operations with any company that employs children in India. It should insist that any company that wants to supply carpets to IKEA should ensure that no child work for them and only accept business when that condition is met. The company could source carpets from other locations until such a time when Indian suppliers abide by this condition.
  4. For IKEA to continue operating in India, and then the most significant course of action would be to sign-up to Rugmark. This is quite advantageous to IKEA since they would outsource the responsibility of ensuring that suppliers do not engage in child labor to a credible institution. If they engage in checking these requirements by themselves, it could be costly and in most cases they would be duped into believing suppliers are not hiring children. Rugmark is more credible since it is a local initiative that is entirely focused on eradicating child labor in India. In the long run, suppliers will have adhered to this condition and India will be a good location for IKEA.