CORPORATE ENVIRONMENT

Corporate Environment



Table of Content

INTRODUCTION3

TASK ONE3

1. What threats might the film industry as a whole experience?3

2. Using the above case study, analyse the use of SWOT analysis in helping IKEA to develop as a sustainable business.5

3. With respect to the given situation, what can IKEA do to fulfil its social responsibility?7

TASK TWO9

1. What business strategy- market and nonmarket strategies-should Toys 'R' Us adopt to enter successfully the German market?9

2. How should Toys 'R' Us deal with the protests of German toy manufacturers an local toy retailers?11

3. What should Toys 'R' Us do with respect to the government regulation of the store's opening hours?14

REFERENCES18

Introduction

The corporate governance malpractice such as the scandals of Enron and WorldCom and the dramatic decline of stock markets at the beginning of the new century have fuelled an age-old debate on the fundamental issues of corporate governance: for what purpose the corporation exists and whose interests it serves. For example, in the third issue of Organisation Science in 2004, two articles with opposite views were published. Whilst Sundaram and Inkpen (2004) insist on the dominant paradigm of shareholder value maximisation, Freeman et al. (2004) reject this conventional ideology and instead argue for the value creation for stakeholders. Both sides have taken tit for tat arguments and rationalised the primacy of shareholder or stakeholder value creation and maximisation. Each side assumes that their own theory is superior to others and has better business implications and is easier for managerial application.

Task One

1. What threats might the film industry as a whole experience?

IKEA's goals of sustainability and environmental design are central to its business strategy. It has launched a new sustainability plan to take the company through to 2015. This will combine social, environmental and economic issues.

IKEA uses SWOT analysis to help it reach its objectives. This is a strategic planning tool. It helps the business to focus on key issues. SWOT is the first stage of planning and looks at the Strengths, Weaknesses, Opportunities and Threats involved in a project or business venture.

Strengths and weaknesses are internal aspects. This means that they are within the control of the business. They may refer to aspects of marketing, finance, manufacturing or organisation. Opportunities and threats are external factors. This means that they are outside the control of the business. These may include the environment, the economic situation, social changes or technological advances, such as the internet.

A business can create opportunities and counter threats by making the most of its strengths and addressing its weaknesses. For example, one of IKEA's key strengths is its strategic aim to use no more material than necessary in the production of each item. In addition, it develops its product plans to increase its use of waste or recycled materials.

* One particular table, the NORDEN table, uses knotty birch wood. The knots in this wood usually mean it is rejected by other retailers and manufacturers as unsuitable for use. However, IKEA has made the knots part of its design ...