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Write a synopsis that describes the background information about the case, an overview of the case. The IKEA distribution chain demonstrates a system that employs exclusive outsourcing for product manufacture.
Due to this type of sourcing, i. The fact that IKEA itself owns no manufacture or production facilities but instead relies exclusively on contractors they have only limited control of how such facilities generate product, with the exclusion of the contracted quantities ordered.
Given this scenario IKEA has recently come under fire through public awareness campaigns because exploitative child labor is being used in the production of rugs supplied to the company in India, Pakistan and Nepal.
Short-term and long-term decision making must take place that demonstrates good faith in IKEA's relatively new anti-child labor contract amendments and reduces the fall out of the immediate situation while simultaneously demonstrating a long-term proactive response to the issue of child labor in the production of its rugs.
In other words IKEA must choose to either eliminate one of its major suppliers of rugs or work with them and others to help respond to the issue of child labor practices in a way that mitigates market loss as much as possible.
You should include only those issues that impact the identified problem. The carpet line at IKEA is relatively profitable by current standards and though it does not constitute a huge portion of total profit from sale of goods the whole of the product line would be seriously hindered if the exposed manufacturer which has been exposed as a child labor offender were eliminated completely as a supplier Bartlett, Dessain, Sjoman, The two main stakeholders in the situation are IKEA in general and the major supplier of Indian rugs Rangan Exports but the relatively new member of the marketing management team Marianne Barner, in this position at IKEA less than 2 years prior to the scandal breaking holds the majority of responsibility for decision making in the situation Bartlett, Dessain, Sjoman, IKEA therefore has a central responsibility to act in a way that supports the goals of the company to source ethically in a public manner Hue, Rangan Exports as well as other unexposed but likely just as ethically questionable sources has a fiscal responsibility to uphold its commitment to the signing of the IKEA child labor clause in its contract.
The IKEA contract is likely a huge portion of its sales, given the fact that IKEA is a major buyer of Indian rugs and though the company may not be violating local laws to the extent of a localized identified response the company must be reviewed in some way to ensure that changes are made and that children being exploited are relieved of burdens and given opportunities, that are in their best interest Hue, Internal controls as well as external review is essential for the company to make changes that will ensure compliance with all local laws as well as IKEAs standards, which are based on international child labor law standards Barner, Marianne Barner has a fiscal and marketing responsibility to IKEA and to IKEAs consumers and other suppliers to establish both short-term and long-term responses to the problem at hand.
The marketing responsibility requires swift action, some of which has been taken by Barner already in the form of fact finding and global and local research on the issue, including the legal aspects of the case i.
If the company is acting outside its local legal rights and scope and scale issues of child labor. Yet, ultimately Barner is responsible for making the final ethical decision of either terminating the contract with Rangan Exports and any other companies found to be out of compliance with IKEA child labor standards or to create a working relationship with the contractors that ultimately responds to the best interest of the children involved by assisting those found to be at risk through supportive programs and social network changes Hue, Identify one key problem.
While there may be several problems and a multitude of symptoms, attempt to identify one problem, the resolution of which would alleviate most of the symptoms found in the case. The problem can frequently be defined around one of the key factors of the case scenario.
The key problem in the situation is the hands off manufacture approach used by IKEA to source products, to be proactive and still utilize low cost labor to keep prices for consumers low IKEA must be socially responsible by being more active in manufacture site review.
Though this could ultimately reduce profit margins the need for both short-term and long-term review in the age of social awareness in marketing IKEA must respond to this demand.
Develop two or more alternative solutions to the defined problem. This should not be a laundry list of actions one could take to address every symptom, but alternative actions that could correct the problem at hand. Identify the pros and cons of implementing each alternative.
Alternative solution 1 Eliminate Rangan as a contract supplier and cancel all existing contracts in the face of the violation of the child labor aspect of the contract.
The pro-of the response would be a discernable and swift response to the current exposure problem. The cons of the response would be a decline in availability and therefore sales capacity of current rug products, the lack of long-term solutions for a large and formerly reputable supplier, and utter lack of support for children already identified as exploited and having already produced the labor for the particular contract supplies.
Alternative solution 2 Allow Rangan ample time to perform corrective action on their own, pending a review by IKEA for current and future contracts.
The pros of this alternative include the ability of IKEA to meet current supply deadlines and provide products for their stores, the supportive yet non-invasive responds is also indicative of company history. The cons of this response are that it would provide little discernable evidence of a proactive response on the part of IKEA for consumers and partners already identified as collaborators in attempting to respond to the problem and it would also likely do little to aide those already identified as exploited.
Alternative Solution 3 Suspend contracts with Rangan on a provisional basis, allowing the contractor to fill current orders pending review of systematic changes in child labor practices and create a proactive programs approach for children employed by Rangan, including screening for employment of both employees and subcontractors, internal and external audit of manufacture facilities and increased regulations for hours of work and opportunities for employees.
The pros of this response are that current orders will be filled and the contractor will be allowed a reasonable time to make changes and challenge the situation while IKEA is simultaneously responding to this cultural challenge.
Selected Solution to the Problem: Select one of the alternatives and explain why it would be best. Most of this work is already done if the alternative solutions clearly point out advantages and disadvantages to each. Additional study or research can be a part of the recommendationbut should not be the primary solution.
Your job is to identify an action, not put off action.Sourcing your essay should include four. 5 stars based on reviews ashio-midori.com Essay. Using quotes in essays uk team reaching a goal essay l usager du service public dissertation abstract fowling in the marshes descriptive essay ccot essays jan global regents thematic essay, city limits.
Global supply chain management Essay. You do not need to conduct in depth analysis using the equations we have looked at in supply chain planning or in global supply chain design You can consider the different variables which are used in these equations, which impact on supply chain planning and network design Part of the task is to manage the level of content in the time period you have.
Global Sourcing & Logistics Essay - Introduction Logistics is a concept that entails translocation of products from the selling point to the designated destination. GLOBAL SOURCING Definition Global sourcing is defined as a centralized procurement strategy of a international consortium, whereby a central buying organization strives to create economies of scale through corporate wide standardization and benchmarking.
This is a sample Essay on Outsourcing from ashio-midori.com – the leading provider of reliable and affordable essay writing services and research paper . MO Strategic Supply Chain Management Global Sourcing- Benefits and challenges for H&M Northumbria University, UK Abstract Global sourcing is a technique of strategic sourcing in the global strategy, which is an effective approach as a part of organization’s procurement section.