Case 8-3 Ikea Essay Example | Topics and Well Written Essays - 1250 words

Case 8-3 Ikea - Essay Example It can also be defined as the way in which companies manage their business processes to produce an overall positive impact on society (Mallerbaker, 2009). This paper discusses the problems Ikea Corporation faced in the late 1990’s associated with CSR issues particularly child labor accusations. Ikea Corporation create a corporate culture that while it was streamlined and relaxing since the manager did not operate in beaurocratic manner, they also seem to forget about their responsibilities of the activities of the company abroad. Ikea was not well prepared to deal with international issues such as child labor. The company got a wake up call after some of its suppliers were caught involved in child labor practices. The company did not like the negative impact the revelation had on its sales and customer relations. The firm realizes its needs solutions to deal with the issues the company is facing. The company is facing public relations problems due to accusations that the firm is involved in child laborer practices. The child labor violations occurred not directly at Ikea, but as indirect associations since major supplier of Ikea at being accused of such acts. The first reaction of the company was that they were unaware of the child labor activity and they are against that type of illicit activity. The company never before had dealt with these types of issues. The executives of the company were at fault due to their incompetent managerial activity in which they failed to implement any proactive measures that could prevent such circumstances from occurring. The business risk of the company is high regarding its public image. After the public relations issues the company lost 20% of its sales in Denmark (Barlett et. al., 2008). Ikea is a company that has been able to successfully implement an organic growth model during the last 40 years. The