Google in China and IKEA’s Global Renovations

847 words | 3 page(s)

Protecting Property and Rights

Q (1). How would you characterize China’s market for online search and related services?
Apart from being highly populated, China had a high penetration rate at about 90% (Li, 2012). Google also faced stiff competition in the market with its main competitor availing a more superior product in the market. The decision by Google to venture into this market was as well rushed thus making it hard for it to capitalize on existing opportunities. Baidu’s decision to infringe on property rights also worked against Google’s initiative. On the other hand, the Chinese government demanded a change in Google’s policy to encourage Censorship despite it contradicting Google’s core values (Lee, 2013). Despite standing out as a great market with a high penetration rate, the Chinese market was less favorable for other players to compete with the likes of Baidu which commanded a lion share of the search engine market. Apart from this, the government regulations also complicated the situation while demanding a change in policy to conform to the set jurisdiction.

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Q (2). Why was Google initially attracted to China? What changed its perspective?
While globalization is praised for having transformed how people interact across the globe, it has to an extent brought about unique challenges owing to the prevailing cross cultures among nations. Such problems also make it had for aspiring organizations to fully exploit the new markets without being compelled to consider adopting a different approach for their dream to materialize (Routamaa & Hautala, 2008). Our focus takes an in-depth look at such an experience while analyzing Google in the Chinese market.

The setting up of an office at the Fourth-Ring road was a way to assure the public of its confidence in the Chinese market. Some of its services were, however, shifted to Hong Kong. Among the reasons contributing to this decision was the refusal by Google to censor information on behalf of the Chinese regime owing to a hacking attempt on its servers. Google’s decision was seen as a bipartisan approach while giving the US government a special kind of treatment (Li, 2012). Just like its predecessor, the Soviet Union, Sergey Brin believed that the Chinese economy was likely to collapse in future and thus present an excellent opportunity for Google to monopolize the entire market.

Q (1). How would you describe IKEA’s overall approach to international expansion? What were some of the important successes and challenges it experienced along the way?
The excellent product designs have to ascertain extent encouraged more sales and rarely used as a means to charge exorbitant prices as is the case with its competitors. The move also helped lower the storage cost due to the large volumes of goods produced (Chopra, 2009). Such factors steered IKEA’s growth leading to its expansion. IKEA, however, came across unique challenges while going about its initiative such as the cake contamination incident. This was likely to hurt its reputations owing to negative publicity. IKEA was compelled to reassure its clients that its products and services were worth buying.

The company needed to consider embracing a shift in how it ran its business. While acknowledging the idea of Kampala having his sons get a significant stake in the organization, this was prone to affect the company negatively, especially if mismanaged. On the other hand, the rising income levels meant that more consumers were willing to spend more on luxury goods. The company, therefore, needed to change its approach to capitalize on such opportunities.

Q (4).What motivation, leadership, and international HR approaches has IKEA pursued to achieve its international success? What additional steps might it consider given its expanding global reach and impending change in leadership?
Ever since it was established in 1943, IKEA has emerged to become one among the leading players in the world retail industry while selling off its accessories across its outlets internationally. Among its main products include the sale of furniture as well as kitchen accessories just to name a few. It also adopted a two-tier corporate structure where they each focused on distinct functions. The company’s operations are managed by IGKA where it runs about 235 outlets. The remaining 30 outlets are franchised by the company (Chopra, 2009).

Among the main reasons leading to its success has been its approach to bring about a difference in every person’s life while availing reliable products and services in the market (Chopra, 2009). Most clients have also welcomed the idea thus leading to sustainable growth while at the same time transforming lives. The move helped IKEA rival its competitors owing to its affordable prices thus utilizing its advantage of scale while availing a wide variety of products to the market.

  • Chopra, R. (2009). IKEA case study. Retrieved from http://aeunike.lecture.ub.ac.id
  • Li, X. (2012). Why is Google blocked in China. Retrieved from https://www.quora.com/Why-is-Google-blocked-in-China
  • Routamaa, V. & Hautala, T.M. (2008). Understanding Cultural Differences The Values in a Cross-Cultural Context. Retrieved from http://citeseerx.ist.psu.edu
  • Thomas J. Lee, T.J. (2013). Google’s problems in china: finding the right approach. Washington. Georgetown University. Retrieved from https://repository.library.georgetown.edu

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