Overcoming Institutional Barriers: A Case Study of Arla Foods

This report provides a case study analysis of Arla Foods, a Danish dairy company, and its experience with institutional barriers when expanding into Asian markets. The report highlights the challenges faced by Arla Foods, particularly concerning workplace discrimination related to gender, age, and race. The company's response involved restructuring its international operations, adapting assessment practices, and promoting diversity through hiring local candidates and implementing a zero-tolerance policy. The analysis emphasizes the importance of addressing both individual and institutional sources of discrimination to foster a more inclusive environment. The report concludes by summarizing the key strategies Arla Foods employed to overcome these institutional challenges, including changes in organizational structure, selection procedures, and the promotion of diversity within the workplace. The company's actions demonstrate a commitment to ethical business practices and building a positive brand reputation in the face of adversity.

Running head: INSTITUTIONAL BARRIER
Institutional Barrier
Name of the Student:
Name of the University:
Author note:

1INSTITUTIONAL BARRIER
This paper shall elaborate on providing an example of a firm that experienced the
institution barrier in recent years and shall identify how it responded to the institutional
barrier. Furthermore, it shall also analyse the strategic action used by the firm to overcome
the institutional barrier. The chosen firm for this purpose is Arla Foods from Denmark.
Arla Foods, a farm owned international dairy company from Viby, Denmark very
recently in the year 2016 faced institutional barrier while taking a step towards expanding its
business to the emerging least developed markets in Asia (Levidow et al., 2016). It is to note
that internationalisation has always been one of the significant and well used strategiesused
by most of the executives in order to reduce their costs of operations. The same was the
motive of Arla Foods of Denmark. Institutions play an important role in the economy of a
particular market. Its main aim is to make sure that there is an efficient and effective
functioning of the market mechanism. Arla Foods successfully identified this importance of.
Therefore, the company chose to go global. However, while operating its business in the
international market, it had to carry the blame of different types of discrimination within its
workplace including gender discrimination, age discrimination and racism as well.
However, the company gradually realised that the strategies for overcoming this
problem need to address both the individual and the institutional sources of discrimination
and prejudice in the situations and contexts in which the participants involved in the activity
of racism and discrimination learn, live and work altogether in a collaborative and supportive
manner. The sources of discrimination are more or less rooted in particular social and
historical context and are at the same time, sharped by the institutional practices and
structures (Seo & Creed, 2012). Therefore, Arla Foods decided to change its international
organisational structure on the basis of the country it has expanded itself to. The company
chose to freckle the assessment practices and the selection process along with the stereotypes,
stories and beliefs of the staff members which had become a significant part of the local lore.

2INSTITUTIONAL BARRIER
It chose to design the programs and the practises by keeping in mind the power differences. It
ensured that power differences, whether imagined or real are kept at the heart of the
intergroup tensions and at the same time, are dealing with the change of the organisational
members’ behaviour in significant manner.
Moreover, the company also chose to influence the behaviour of its staff members in
the new place with putting more emphasis on the capability and the motivation level of their
in influencing the same of the others. It gradually started hiring the local candidates more
than before and ensured that each one of them are treated equally in the organisation. The
company also made sure to form a brand reputation of being a company that encourage and
promotes diversity within the organisation. Often, the race relations programs and the related
activities focus on the knowledge and the awareness related to the behaviour towards the
colour and the person (Pope, Reynolds & Mueller, 2019). When ethnic and racial diversity
prevails, the diversity provide a great opportunity for the learning and development of the
organisation. It also avoid the existence of stereotyping and oversimplification within the
organisation that can result in bad social reputation of the company. Moreover, Arla Foods
have also imposed Zero tolerance policy (ZTP) in the company where individuals are given
the complete freedom to give ZTP whenever they find themselves to be mistreated or ill-
treated by any of their colleagues inside the office premises. The management department of
the company ensured that necessary actions are taken place in order to resolve the issues.
Furthermore, the company decided to make this policy and implementation visible for the
local audience in order to make sure that the bad reputation of company gets vanish and
people know that company is ethically conducting its business.
Hence, from the above analysis it can be concluded that Arla Foods have faced a
severe challenge of carrying the blame of different types of discrimination within its
workplace including gender discrimination, age discrimination and practice of racism.

3INSTITUTIONAL BARRIER
However, it was successful in overcoming this institutional challenges by bringing several
changes in its organisational level including change in the selection procedure, changing the
organisational structure, imposing anti-discrimination policy within the organisation and
hiring more employees belonging from different cultural background in order to ensure that
there is diversity in the workplace.

4INSTITUTIONAL BARRIER
References:
Levidow, L., Lindgaard-Jørgensen, P., Nilsson, Å., Skenhall, S. A., & Assimacopoulos, D.
(2016). Process eco-innovation: assessing meso-level eco-efficiency in industrial
water-service systems. Journal of Cleaner Production, 110, 54-65.
Pope, R. L., Reynolds, A. L., & Mueller, J. A. (2019). Multicultural competence in student
affairs. Jossey-Bass.
Seo, M. G., & Creed, W. D. (2012). Institutional contradictions, praxis, and institutional
change: A dialectical perspective. Academy of management review, 27(2), 222-247.