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Case
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Reference no. 320-0339-1
Published by: Cranfield School of Management
Originally published in: 2020
Version: 29-Oct-2020
Revision date: 24-Nov-2020

Abstract

This is part of a case series. This case study demonstrates a practical example of the complex and ambiguous process involved in making strategic decisions relating to a company’s international expansion. The students can apply and develop their skills in strategic decision making in this practice-driven exercise. The case study consists of four parts delivered in consecutive order. The first part of the case provides general information about IKEA and its business at the end of the previous millennium. The students are asked to outline proposals relating to the company’s further international expansion. In the second part, the students are provided with a background of the economic, social and political situation in Russia as it was in 1998. This is the moment of IKEA’s decision to enter the country. Students are asked to outline their recommendations concerning the company’s options to set up IKEA’s operations in Russia. In the third part, an example of doing business in Russia is presented. The students need to decide how to solve a practical problem, which is related to the local business environment and culture, on behalf of IKEA’s corporate management team in Russia. The fourth part introduces students to a new turn of events: their ex-supplier of electric diesel alternators is prosecuted in a criminal court; he claims that IKEA was involved in orchestrating an unlawful investigation and procedure against him. The students can discuss whether IKEA might be able to claim back the money previously paid out after the lost court case with the ex-supplier.

Teaching and learning

This item is suitable for postgraduate and executive education courses.

Time period

The events covered by this case took place in 1998-2018.

Geographical setting

Region:
World/global
Countries:
Sweden; Russia

Featured company

IKEA Group
Employees:
10000+
Turnover:
EUR 25 billion
Type:
Privately held
Industry:
Furniture manufacturing, retailing

About

Abstract

This is part of a case series. This case study demonstrates a practical example of the complex and ambiguous process involved in making strategic decisions relating to a company’s international expansion. The students can apply and develop their skills in strategic decision making in this practice-driven exercise. The case study consists of four parts delivered in consecutive order. The first part of the case provides general information about IKEA and its business at the end of the previous millennium. The students are asked to outline proposals relating to the company’s further international expansion. In the second part, the students are provided with a background of the economic, social and political situation in Russia as it was in 1998. This is the moment of IKEA’s decision to enter the country. Students are asked to outline their recommendations concerning the company’s options to set up IKEA’s operations in Russia. In the third part, an example of doing business in Russia is presented. The students need to decide how to solve a practical problem, which is related to the local business environment and culture, on behalf of IKEA’s corporate management team in Russia. The fourth part introduces students to a new turn of events: their ex-supplier of electric diesel alternators is prosecuted in a criminal court; he claims that IKEA was involved in orchestrating an unlawful investigation and procedure against him. The students can discuss whether IKEA might be able to claim back the money previously paid out after the lost court case with the ex-supplier.

Teaching and learning

This item is suitable for postgraduate and executive education courses.

Settings

Time period

The events covered by this case took place in 1998-2018.

Geographical setting

Region:
World/global
Countries:
Sweden; Russia

Featured company

IKEA Group
Employees:
10000+
Turnover:
EUR 25 billion
Type:
Privately held
Industry:
Furniture manufacturing, retailing

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