Abstract

The case “IKEA in Russia – Ethical Dilemmas” describes the efforts and tribulations of international furniture retail giant, IKEA while setting up and doing business in the emerging market of Russia. The case starts out with the efforts made by Lennart Dahlgren to set up IKEA’s first store in Russia. It details the challenges faced by him in this process. Later, the case talks about the way IKEA went about positioning its stores, in addition to the new business model it came up with considering the unique circumstances of Russia. Apart from that, the case primarily details IKEA’s struggles with a corrupt bureaucracy in Russia and the way the system always went against its business plans. It also mentions the company’s struggle to adhere to its own ethical standards, both in Russia and other global markets.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• To analyze the economic conditions of an emerging market before devising a market entry strategy
• To recognize the need for a strong corporate policy to deal with a tough business environment
• To help develop strategies to grow and prosper in an emerging market
• To understand the difficulty in ensuring adherence to the corporate culture in diverse geographical markets

Keywords

IKEA, Russia, Specialty Retail, Emerging Markets, Ethics, Corporate Governance, Corruption, Market Entry Strategy, Sustainability, Business Model, Corporate Policy, Multinational, Bureaucracy, Red tape, Mega Mall, BRIC, Bribery , Corporate Culture, Government , Swedwood