Individuals in Society FYS001-0: IKEA in India Cultural Dimensions

This presentation analyzes IKEA's strategic expansion into the Indian market, focusing on the application of Hofstede's cultural dimensions model to understand and navigate cultural differences. The presentation begins with a background of IKEA's business case in India, highlighting the opportunity for growth. It then introduces Hofstede's cultural dimensions, a framework for understanding cross-cultural communication and societal values. The core of the presentation examines two key dimensions: power distance and individualism, comparing India and Sweden. The analysis reveals significant differences in these dimensions, which can impact communication, management styles, and employee relations. The presentation further explores communication problems arising from cultural differences, including language barriers and differing interpretations of symbols and signs. It concludes by emphasizing the importance of cultural analysis for business success, particularly in international expansion, and reiterates the value of the Hofstede model for IKEA's operations in India. The references provided support the findings and analysis presented.

INDIVIDUALS IN SOCIETY
FYS001-0

TABLE OF CONTENT
 BACKGROUND OF IKEA OPENING IN INDIA
 INTRODUCTION BASED ON HOFSTEDE CULTURAL DIMENSION
MODEL
 TWO OF HOFSTEDE CULTURAL DIMENSION
 COMMUNICITON AND CULTURAL PROBLEM DUE TO DIFFERENCE
IN INDIA AND SEWDISH
 CONCLUSION
 REFERENCES

INTRODUCTION
 For the business to be successful it is very essential that they analyse
the culture of the business.
 At time of expanding into another country the most essential aspect
which company needs to undertake is to analyse the culture of the
country.
 The current presentation will outline the business case of IKEA which
is planning to open its store in India.

BACKGROUND
 In the present case scenario IKEA is planning to open its store in
India is well. This is a good opportunity for IKEA for its business
expansion.
 The reason underlying these factors that currently there is a
preference of consumer relating to customised furniture and modern
furniture.
 Hence IKEA is providing all these facilities and if they will expand
their business in India then this will be beneficial for both India as
well as for IKEA.

Introduction based on Hofstede cultural dimension
model
 Hofstede is the one of the most effective and beneficial strategic
frameworks that has been in the context of varied nations, in order to
comprehend differences between each nation based on culture.
 It is also utilized to discern ways that a company is done across different
cultures.
 The main motive of this concept is to identify each dimension in which
cultures vary.
 It encompasses six dimensions that define which culture a society or
community within a nation may follow and conduct practice accordingly.
 It includes power distance index, collectivism vs individualism, uncertainty
avoidance index, femininity vs masculinity, short term vs long term
orientation, and Restraint vs indulgence.

TWO OF HOFSTEDE CULTURAL DIMENSION
 Hofstede cultural dimension theory is the framework for
cross culture communication which has been developed
by Geert hofstede.
 It helps in understanding the effects of society culture on
value of member, their behaviour and various factors.
 Thus it helps in determining the communication and
culture difference between two countries that will
contribute in understanding the way IKEA can expand
its business in India to earn maximum profit margin.
 The two dimension of Hofstede cultural model are
applied on India and Sweden as follows:

CONT.
 Power distance: It can be stated that India score high dimension of power distance as compared to Sweden such as77 which
clearly specified that individuals are appreciation from top to bottom structure in organisation as well as society. There is unequal
distribution of power among people that lead in conflict and confusion to maximum extends between individuals. So, power is
centralised in India as the single boss or head is responsible for making all decision that need to be abided by each person. In India,
employees have to follow the instruction of their superior manager while accomplishing their respective task or activities so that
desired goals can be achieved in limited time frame.
 On the contrary hand, Sweden have low power dimension as it has score 31which means that the people living in Sweden are
being independent, equal right and opportunities. Moreover management empowers and leader coach their team member regarding
the way particular task can be completed in the firm.

CONT.
 Individualism: The score of individualism in India is around 48 that specified that it is
society with collectiveness rather than living individuals. Most of the people living in India
take actions that are good for all rather than thinking for individuals perception. Thus
individual’s actions generally depend upon its family member opinion, neighbour and friend
or relative. So both employees as well as employer have positive relationship in which one
expect that it loyally work for organisation while employer ensure protection of employees.
 On the other hand, Sweden have totally different culture in it individuals like to live alone or
have lower degree of interdependence. Likewise, Sweden is individuals society as it has
score21 which means that most of the people life to live in their manner while following
their families.

Communication problems caused by
cultural differences
 Due to different perception and mindsets of the people belonging
from different cultures, there are certain communication problems that
can take place such as different meanings interpreted by people
belonging from different cultures.
 Also, there non – verbal communication comprising of signs and
symbols are also different for different cultures.
 Cultural differences causes difference in the use of gestures and
behavioral patterns of people which gives rise to ethnocentrism,
prejudices, differentiating opinions and manners.

Factors causing communication and cultural
problems
 Language: Different regions have developed their own language
where when business community gets interacted with those who are
belonging to different regions and are able to speak their own
language only. Then this may create a problem of misunderstanding
in the organization and categorized as cultural problem due to cultural
differences and acts as barrier to an effective communication.
 Symbols and signs: Different cultures uses different symbols and
signs for different purposes. It has different meaning and
interpretation for different cultures. So, it is advisable not to rely upon
nonverbal communication while communicating with people who are
belonging from different culture as ours. For example “thumbs up” on
one side is interpreted as sign of wishing best of luck in many cultures
including India but at the same it is taken as a sign of insult in many
other cultures.

CONCLUSION
 in the end the above presentation summarise the fact that cultural
analysis is very essential for the business in getting successful.
 The reason underlying the same is that when culture of the company
and the place where it is established is good then this will motivate
employees to work in much better an effective manner.
 the above discussion analyse the fact that management of culture is
very essential and for this IKEA undertakes the use of Hofstede
cultural dimensions.
 Under this model IKEA analysed two dimensions of this model
particularly power distance and individualism full stop for that
evaluated Tata there are different communication and cultural
differences which create problem for IKEA.

REFERENCES
 Litvin, S. W., 2019. Hofstede, cultural differences, and TripAdvisor hotel
reviews. International Journal of Tourism Research, 21(5). pp.712-717.
 Talalova, L. and Werthschulte, D. K., 2020. ADAPTING TWO CULTURES
(A GLANCE THROUGH THE HOFSTEDE'S CULTURAL DIMENSIONS
MODEL). In FUNCTIONAL ASPECTS OF INTERCULTURAL
COMMUNICATION. TRANSLATION AND INTERPRETING ISSUES (pp. 12-
18).
 Kristjánsdóttir, H., Guðlaugsson, Þ.Ö., Guðmundsdóttir, S. and Aðalsteinsson,
G.D., 2017. Hofstede national culture and international trade. Applied
Economics, 49(57). pp.5792-5801.