How Ikea Manages Cultural Issues in China Operations
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
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