Samsung Electronics Tv In An Era Of Convergence Harvard Case Solution

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Samsung Electronics Tv In An Era Of Convergence Case Study Solution & Analysis


Samsung Electronics Tv In An Era Of Convergence Case Study Solution is a worldwide company in Sweden. It is primarily a home furnishing company founded by Ingvar Kamprad in 1943. When he started his first mail-order company, he named the business at the age of 17. It was called as IKEA by a combination of terms associating with his individual life from his personalizes to his family farm i.e. Ignvar Kamprad Elmtaryd Agunnaryd. He began his vision to make real by selling his some products acquired by a cheap source for the regional retailers by newsletter advertisement. In 1948, by the additional ad in the newsletter about the furniture has actually matched the criteria with its competitors. It has resulted in renounce the products sale and start with furniture. For the client complete satisfaction and minimize the rate of returns, he intentionally opened a shop in an Almhult named area near his home town. In the future, the little newsletter advertisement changed into a catalogue.

Given that 1950 to late 1990s, it has actually made remarkable development in both the incomes in addition to in expanding of the business. It had one shop while in the late 1990s it has more than 100 stores residing in multiple nations( see Exhibition 1). The company was growing so well in competitors with leading rivals in the market. The competitors due to declined sale threatened the providers of IKEA to not take orders at low rates. In 1961, IKEA contracted with a number of the factories manufacturing furnishings and hence it once again created low expenses. On the other hand, Samsung Electronics Tv In An Era Of Convergence Case Study divided its shop in a variety of departments like cheap price lunchroom, children play-area, along with a Sweden Purchase the foods making it a popular exporter of food. Over a period of time, the product variety was expanded varying from carpets, floorings, lights to various item line required in providing home.

The motive of the business was to sale quality items with sensible costs with variation in products globally based on a vision to create a better way of life for almost everybody. Every year, the business commemorates an anti-bureaucrat week to develop much better contact in between the clients and suppliers.

In the mid duration of 1990s, IKEA has a broad working connecting with about 70 countries tracking down its products about 11,200. It dealt with almost a bigger number of suppliers around 2300 internationally (see Display 2). When there were environmental issues developing about IKEA's items simultaneously the issuance on the kid labor emerged. This has led the company to deal with the tough circumstance in the maintenance of their relation with providers. Due to this reason, IKEA's appeal reduced dropping the 20% of its sale in Denmark. .

Secret Players.

There are 2 key players in this case one is IKEA Company and other is its providers. IKEA's strategy is to outsource its item manufacturing to providers. These providers are normally 3rd party and based throughout the world.


There is unfavorable impact of these concerns on profits of the business and also track record of the company. They wanted Samsung Electronics Tv In An Era Of Convergence Case Study Help to be socially responsible and desired that it did not have any connection with kid labour or any other environment problem. IKEA techniques also did not work well sufficient to address this issue (see Display 3).

Approaching Concern of Kid Labour.

IKEA strategy is to keep high level of social obligation due to the fact that it is one of the significant catalyst in success of business. IKEA is worried on kid labour issue and other environmental issues to support this technique.( Naidu & Ramaiah, 2006) Furthermore, Samsung Electronics Tv In An Era Of Convergence Case Study Solution was also motivated by Swedish Save the Children company to act "in the best interest of kid".

Reaction to German producers on Video Program:

In reaction to the invitation of German producers for IKEA, the invitation should require to be accepted. The first primary thing to think about is that the documentary is made by a German company. It is not compulsory to be and accept the invitation part of the live conversation however it is of essential significance. As it supplies Barner to have live discussion throughout on-air programs. It generates a likelihood to give much better explanation of their issues about their relationship with India. Particularly, Barner can potentially demonstrate her idea of mind with a clear justification letting people know that for her it is more important to be more concerned about the IKEA track record as she is only accountable for this. It is important to eradicate the requirements of child labour however this can potentially not done by stopping organisation relate to their partner companies which involve the trend of child labour. This understanding of Barner may assist her in preserving IKEA clear reflection and may also lead to stronger relationship of the companies. It also provides IKEA to mindful the German producers to fight against the child labour.

As the German Producers had only used IKEA to view some of the shots from their documentary. They ought to be requested to let them watch the entire movie rather of some shots which reveals certainly an uncertain image of the reality. This might be the strategy of German producers to prove themselves right against the claims but leaving IKEA behind full of doubts about their relationship with the companies of India on the problem of child labour.

On the contrary, the IKEA has actually been positively portrayed about the problem of Child labour when the problem was at first installed by the Swedish Television. There are a set of info on kid labour by IKEA which was significantly collected by ILO and UNICEF. This details truly demonstrates the exact same viewpoint as same as that of the documentary makers. This will let the producers to astonish about the troublesome concern by clear representation of child assistance during their labour at the manufacturing markets.

As the German producers refused to show their documentary to IKEA prior to it is telecasted merely suggests there evil intent of point the finger at someone and their relationships with IKEA perhaps. There might a strong contradiction that the IKEA is fearlessly engaged with an organization which uses child as their labour and continue their relations to earn incomes with the suppliers while being conscious of the fact.

In addition, Barner has a strong point of reason which is their philosophical declaration i.e. everybody makes mistakes however one takes its duty. The obligation of the mistakes taken by anyone is considered as the best source of pride.Despite of the reality that Samsung Electronics Tv In An Era Of Convergence Case Study Analysis was not aware about the growing concern over the kid labour in addition to the including kid's as labours by the markets, the providers of the IKEA. Throughout the approval of agreement, IKEA began examination against its provider markets around the world. If revealed in the documentary by German producers, the management of IKEA is not afraid of accepting its mistakes. It will accept its mistake and take measure to put it right again.

Barner can likewise create another reason on the ineffective obligation over social issues. It is planning to be involved with the social concerns but has not taken such measures yet. In the field of marketing, IKEA is on top with exceptional ideas in addition to its eye-catching products.

The issues of the IKEA is towards leading long term relationships with its network of distribution worldwide. IKEA is not just recently involved in any of the social activities about the rights and concerns of each individual working in the industries and earning them a good-looking profit. In future, IKEA will plan to be part of responsibility over the social issues.

It can be concluded that as per the issue for the company's reputation and share of share should accept the invite and present it valid ideas only in case if everything in documentary is versus the Samsung Electronics Tv In An Era Of Convergence Case Study Help. Particularly, IKEA had actually begun a Foundation based on the concept of protecting rights of child labour and to supply them with complimentary environment to inform themselves. (Barlet, 2006).

Actions on Supply agreement with Rangan Exports:.

Under the IKEA issues about the most logical and tactical strategy in referral to the child labour issue need to offer Rangan Exports with another opportunity to assist them in conquering this problem.

IKEA needs to take some procedures in order to figure out of the truth. , if the evidence against the Rangan export is true therefore leading it in the failure on the ethical level which were outlaid by IKEA.. This plainly indicates that on IKEA, the supplier industry leading to conflict on the kid labour problem.

Consequently, IKEA deals with a vision of producing much better way of life for each individual which is a strong representation for the enterprises to represent the rights of workers of Rangan Exports. The idea of kid labour does not involve a single business as a huge network of companies are accountable in putting it ahead. This is among the most important issue of social concerns and it would be oppression to blame a single one.

Barner can think about 2 options to solve this concern. Initially, either termination of the agreement with the Rangan Expors on the basis of including kid labour to work after the examinations to be sure about the fact. This brings a hazard of losing brand position and reputation if the management of IKEA not decides for the agreement termination. This might result in the monetary decline state of IKEA by reduced ratio of sale, less popularity of the brand and the issues over social duties. If any country to consist of kid labour, as it is definitely not supported by the residents. This replacement is legal and reliable with the policy of IKEA. The primary drawback of this replacement is the IKEA deprivation with a beneficial association and might lead to the terminating relations with the sources of rug by India.

This will help in upkeep of the healthy association in between the provider and the IKEA. This makes obvious for the all suppliers that IKEA is strictly against the kid labour and truly condemn it. This may have a bad effect on the market track record of IKEA by the generation of incorrect publicity.

As it is for the second time that IKEA became a victim of kid labour which has considerably harmed its track record. For this purpose, Barner needs to pursue the aid by ILO and UNICEF in addition to NGOs which might assist Rangan in escaping the requirement to utilized kid labour for the carpets production. It may choose to spread awareness amongst the citizens internationally about the social concerns and how one's life is influenced by in terms of social, and ethical worths.

IKEA by the adoption of very first option, terminates its relationship with thesupplier violation. If results in the failure then portray a bad impact on all suppliers by the increased power of bargaining and the offense of the policy of IKEA. The press needs to be called upon for the statement of their choice with its factor with the summarization of the policy of IKEA on the usage labour of child.

In amount, the company can keep its track record in the market and somehow can bear the loss developed by one provider. With the steady reputation in the market, Samsung Electronics Tv In An Era Of Convergence Case Study Analysis will surely cover up its financial crisis within a short period of time.

Strategy Regarding IKEA's Operations in India

IKEA strategy is basically concentrate on long term relationship with its providers instead of short term. This long term strategy assists IKEA in getting dependable and competitive provider source. For long term relationship they used to help their supplier to make complete use of their capability. They asked suppliers to provide services and items other than their core products and services. The same strategy that was utilized by IKEA in Poland might be obtained.( Harapiak, 2013) The strategy was to outsource production of furniture and not produce by its own. IKEA also requires to ensure that they involve public through its marketing actions which ought to be valuable in comprehending IKEA's intentions.

At earlier time IKEA had no focus on social and environmental issues which likewise includes child labor they utilized to focus on only one method i.e. offering cost effective and quality products to customers. That improved focus could help Samsung Electronics Tv In An Era Of Convergence Case Study Solution in enhancing its reputation towards its clients. Terminating operations from India would not guarantee option to kid labor however likewise negative reputation would be developed that IKEA is not taking any trusted action to fix fundamental problem i.e. kid labor.

There would be also one other negative effect i.e. difference from public. As there prevails view point that big business are always self-centered and are interested in only producing earnings and customers would be thinking that IKEA is one of them. Public has typical view that these business should be socially responsible to society as like they are needed to be accountable to its shareholders. If IKEA did not take any possible step to solve issue of child labor then it would result in loss of sales and IKEA's worth too. For a business like IKEA credibility loss is huge loss because worth of company also based upon it and likewise there would be decrease in revenues and goodwill if there is any credibility loss.

If IKEA think about just sales figure then getting out from Indian market is more suitable. Due to the fact that sales from Indian market just contributes small part to IKEA's revenues. In an economical/capitalistic view risk is more than benefits. But to accomplish business's long term goal i.e. "to produce a better everyday life for many individuals" and "in the very best interest of the kid" it is recommended to not go out from Indian market and continue operations in Indian market with taking necessary precautions.

Samsung Electronics Tv In An Era Of Convergence Case Study Help needed to ensure that child labor is not utilized for their products. So for that function IKEA requires a system that can monitor entire procedure. That system ought to quickly spot whenever kid labor is used in any activity. Suppliers must be encouraged to offer education to children so children can learn something. For that function, suppliers would be having monetary issues. As supplier has lack of financial resources to supply education to children, so Samsung Electronics Tv In An Era Of Convergence Case Study Solution ought to help provider economically and provide them financial aids and ask to balance out by future deliveries.

There might be one other option for this problem that IKEA could install its own manufacturing company integrated with school. IKEA ought to run this school by itself and its auditing task should be given to any other institute like Rugman to make sure it is working correctly for finest interest of children.

Samsung Electronics Tv In An Era Of Convergence Case Study Help Should Sign up to Rugmark.

IKEA believes that every company has its own strengths and weak points. As IKEA has no experience regarding child labor so brand-new personnel would be required for this purpose. It needs to sign up to Rugmart becausethey are experienced in this field of child labor and ask Rugmort to monitor and establish process suggested by Samsung Electronics Tv In An Era Of Convergence Case Study Analysis. Apart from this there should be likewise random tracking from IKEA to make certain that necessary function is accomplished.

Resolving Source of Child Labor.

Samsung Electronics Tv In An Era Of Convergence Case Study Help needs to solve root cause of child labor in order to support its long term vision. IKEA beginning executing its method in multi ways. If it is discovered that supplier did not take any restorative action strategy then IKEA would broke agreement with that supplier and there would be no trade with that specific supplier in future.

Assessment of Samsung Electronics Tv In An Era Of Convergence Case Solution Technique.

Samsung Electronics Tv In An Era Of Convergence Case Study Solution has commitment to its clients to provide high quality products with low prices. Their method would make full use of engaging suppliers and work together to solve problem of kid labor. However according to my individual understanding as from shareholders viewpoint, business is not utilizing its resources efficiently through this method. They would be having hard choice in future from choosing that whether to increase return on investment for shareholders or continue participation with social responsibilities of Indian and UNICEF. Because of less return of financial investment if is greatly invests for social welfare, shareholders would be having negative image of IKEA. Then it would result in greater costs for consumers, if Samsung Electronics Tv In An Era Of Convergence Case Study Solution remained in Indian market. Conflicts of interest for society and management would be resolved. A client would not feel comfortable when he came to know that he buy a rug which was woven by kid but is now getting educated by provider of IKEA. However he would be feeling more comfy when he familiarized that he purchase a rug on a little higher rate which was not woven through child labor.


It can be concluded from analysis that IKEA had actually been dealing with problem in under developed countries because rules and guidelines of under industrialized countries are different from establish nations. The primary problem that IKEA is facing currently is child labor due to the fact that a German documentary maker makes documentary of a provider of IKEA that was utilizing kid labor for production of products. It is concluded that IKEA must accept invitation to live conversation due to the fact that in this way they would be having chance to defend and explain their case to public. It was also concluded that IKEA must sign up Rugmart due to the fact that IKEA has no any understanding relating to kid labor and Rugmart is professional having knowledge relating to concerns of kid labor. As IKEA has no experience relating to child labor so new staff would be required for this function. The strategy that is suggested for kid labor is that there should be collaboration with providers and motivate suppliers to execute programs for child welfare and education. As providers had lack of resources so they should be supplied financial aid and inquired to offset by future orders. This strategy would make complete use of engaging suppliers and collaborate to deal with problem of kid labor.