Business Management Report: UGB107 Introduction, IKEA Analysis

This report provides an in-depth analysis of business management principles, using IKEA as a case study. It begins by defining management and exploring Mintzberg's theory of management roles, discussing their application and the importance of critical thinking. The report then examines how managers can address diverse stakeholder interests. Part B delves into the business environment, including PESTLE analysis and the implications of external forces, particularly economic and legal factors. Finally, Part C focuses on corporate responsibility, identifying practices used to promote it and examples of corporate malpractice, as well as an explanation of Hofstede's cultural dimensions. The report concludes with a summary of the key findings and implications for business management practices.

Introduction to
Business Management

Table of Contents
INTRODUCTION ..........................................................................................................................3
PART- A..........................................................................................................................................3
What is a concept of Management.............................................................................................3
How does Mintzberg's Theory of management role that complements that which identifies the
task of management roles which identifies the task of management? .......................................3
To measuring the task of the management..................................................................................5
The role of critical thinking in management. .............................................................................5
How managers can take account of diverse interest of stakeholders?........................................5
PART- B..........................................................................................................................................6
What is Business Environment? .................................................................................................6
Discuss about the Implication of External forces. .....................................................................7
What extent has the organisation's policy taken the account of these factors? .........7
How should manager decide the factor of pestle analyse to identified as they should have to
attend?.........................................................................................................................................8
PORTER Five forces:.................................................................................................................8
PART C............................................................................................................................................9
The practices the organisation uses to promote and monitor corporate responsibility...............9
Identify two recent examples of corporate malpractice............................................................10
Explain accurately Hofstede’s distinguished five dimensions of national culture...................10
CONCLUSION..............................................................................................................................11
REFERENCES .............................................................................................................................12

INTRODUCTION
The background of business management is defines about the different types of
administration where it manage and mapped the organisation activities. It includes the
manufacturing, selling, procuring of raw materials, capital and resources( Machinery) of product
and services for forming business vision (Bejtkovský, Rózsa and Mulyaningsih, 2018). There are
many other aspects of business that plays an important role such as management of particular
business administration that support through planing, organising, directing, controlling overall
business resources as well as manpower who are serving their contribution to meeting the
objectives of business organisation.
In this report, the IKEA company is a Dutch based Swedish multinational group which
design and sells to customer quantity products of assemble furniture, home appliances and other
useful accessories along with other useful goods and occasionally home services. As they have
2,11,000 number of workforce are actively served their services globally. In this report the topics
which will highlight is about management description along with Mintzberg's Theory and its
implication, explain about pestle and porter five forces for mapping the stability and flexibility of
the business. To analyse the corporate ethics, responsibility covered in the report as further
aspect.
PART- A
What is a concept of Management.
The term management implies to the administration of a particular organisation point of
view where the role of manager is used to handle and maintain the optimum work procedure in
different mannerism through planing, directing, controlling, directing all these function provide
help to balanced the administrative work and scrutinize the implication to improve for further
betterment in organisation perspective (Raut, and et . al., 2019).
How does Mintzberg's Theory of management role that complements that which identifies the
task of management roles which identifies the task of management?
Mintzberg's Theory: According to this theory, it implies about the expectations for the
manager;s traits and behaviour into three categories as informational – to manage the
information, interpersonal- managing and communicate with person and decisional- operates
through undertakes the actions against objectives. To enhancing the overall analysation it derives

about the different ways where the person can accomplish the organisational goals and objective
for making better management and reduces the problem. In Mintzberg's Theory, manager have to
play different roles which are as follows:
 Figurehead: In this theory the role of manager is to figuring out the significant aspect
which are related to the organisation where the responsibility of manager to related with
the task which they have implemented it should be commenced in correct form. In the
perspective of IKEA company, their managers have to constantly measure the errors and
other form of different aspect to be measured in their premises (Belas, and et . al., 2018).
 Liaison: It consists to the perspective of manager's need to require the certain interaction
which can be measure internal and external nature. As per the perspective of IKEA
company, they need to structured their involvement through mutual meeting or team up
to coordinate the work that would reduce the communication gap.
 Leader: The different roles have to played by a manager where leader is the most
important aspect that supports to guide the manpower for their better productivity. As a
manager have to behave as leader to influence the employees motivation as well as
ensures that a organisation is able to achieve the vision through effective procedure way
(Myers., 2019). As in situation of IKEA venture, work act by the manger to guide and
divide the different job roles to subordinate, team leaders and employees where they can
working in proper compliance manner and able to accomplish the goal.
 Disseminitor: This is form of message provider where managers acts as to surpass the
message to other for better communication informational effectively. As per the IKEA
company they appointed their mangers as proficient way where they provided the
valuable information to among peers which can allow them to carry their work
effectively.
 Monitor: This is very important role which commence through manager in every
organisation to monitor and rectify the working aspect in the organisation premises. For
the perspective of IKEA company, their manager are effectively monitor to employees
and other activities which happens in the IKEA's premises (Mendling, and et . al., 2018) .
 Resource Allotment: In the respective companies, the responsible mangers are required
to provide the resources to their employees. The IKEA company's managers measure the
lack of resources on that basis they procure and fulfil all the resources where their staffs

and other department can pursue their work without any disturbance and it enhance the
high mobility.
 Negotiator: It also termed as bargain, but in organisation point of view managers are
acts as negotiator when they get to know that in any situation things can be handle
through a low comprise level (Maunder., 2019). In IKEA enterprise's manager they
enhance the negotiation in such a manner where they get the positive outcome towards
the company.
To measuring the task of the management.
By the assorting of Mintzberg's theory can be formulated by specific organisation where
they can identify the diverse role of which manager are required to play within them. Through
this the task of management can be identified from manager and divided as per the roles and
responsibility served to the organisation. As in IKEA company, their manager has divided the
specific job role or task objective in their different department such to invites and allocating the
manpower to company is handle by Human resource management, optimum utilisation of funds
and other operation work undertaken by finance department and forecasting of product and
services in the market is monitored through marketing department.
The role of critical thinking in management.
The important role of critical thinking is very competitive in the perspective of manager
in the presence of organisation. It arise when a manger of an organisation identifies about what is
actual is happing in the premises. As IKEA, their internal and external business environment
where they measure the basic requirement part that can be fulfilled their needs and expectation.
By considering all the factors of expectation fulfilled and reduces the negative business
environment that prevails the positive business environment along with job satisfaction get
enhance by employees (Kokodey, Gnezdova and Lomachenko., 2018).
How managers can take account of diverse interest of stakeholders?
In specific organisation having different stake holders. These stakeholder having interest to
accomplish the task objectives and goals in the organisation. As per the perspective of IKEA
company, their manager identifies the demands of the stakeholder to fulfil their needs and
expectation.

PART- B
What is Business Environment?
The term Business Environment is come from marketing terminology, where it is factor
to forces that measures to improvise the organisation firm's ability to create and making
successful relationship with customer or clients. It derives the subset of external and internal
factor that influence the business aspect factor that provide the benefits to the company (Santoro
and et . al., 2018).
Pestle Analysation: It is a framework or tools which measure the external factor of organisation
perspective through key roles of Political, economical, social, technological, environmental and
legal that influence an organisation from outside. It also utilised when a company planning to
establish their venture in international country. The IKEA company consider for measure the
Pestle analysation are: Political: In the company point of view, this factor is analyse on the situation base of
particular country political stability as well as able to analyse their corporate of general
working pattern. The aspect which comes under in political factor is government
policies , taxation and stability for IKEA company is effective to execute their business in
more than 30-40 countries. But they have to considered all the political factors to making
their company in other country (Khajeheian, Friedrichsen and Mödinger, 2018) . Economical: The economic factor is considered of different types to effect the company
through their little influence. For IKEA company the economic factor like inflation,
recession and supply demand or market opportunities is very essential to them. As if
IKEA is planing to promote their business in UK region then they need to monitored the
Brexit market which will arise the difficulties to trade in Europe Union and other
international countries. Social: According to this factor, the basic requirement to measuring the customer or
people for the particular company products and services through demographic factor .
The factor as in demographic trait is elaborates about age, gender, religion and customer's
taste and preferences are need to considered by IKEA venture. As IKEA company takes
care about their culture and economy of respective countries where they manufactured
products in systematic manner that will impact on IKEA's business.

 Technology: Through this factor it allows to understands about the new technologies as
resources or in machinery that influence to the particular company. For IKEA company,
if they are enhancing their production in United Kingdom then they need to require of
Research and Development to analyse the scope of resources, IKEA is known for high
investing to implements the high tech robotic advancement tools and techniques to make
the work in flexible and satisfied the customer or clients (Tsyganov, 2019). Environmental: In this factor it influence the business through aware about the particular
environment safety. As weather, climate and other natural climatic can be determined by
the company for their long term sustainability. Even through the contribution for society
betterment is highly essential for IKEA enterprise, as they are authorised product and
services manufactured which has not nay negative illegal specification. They are planing
to investing high effective solar and wind panels for saving the environment from
unwanted diseases (Hamilton, and Webster, 2018).
 Legal: All the legal rules and regulation which are construct through protecting the
respective countries. Similarly, IKEA company have to measured and considered laws,
antitrust laws, employment laws and consumer protection laws must be considered by the
managers of IKEA organisation. It will support to reduce the other illegal activities which
will effect the company growth for long term. A copyright issues is faced by IKEA
venture as they need to improve their legal perspective of business.
Discuss about the Implication of External forces.
The external factor which will influence the IKEA company that would be Economic and
Legal factor. As economic can be impact through Brexit market that can barrier to trade with
other countries and legal can make the copyright issue which IKEA is been facing from long
term and they need to measure the particular country laws and compliances.
What extent has the organisation's policy taken the account of these factors?
The company IKEA need to measure and have to detailed analyse the legal policies of
particular country before to establish any business market, political and economical provide
guidance about the corporate related norms and economic condition through market performance
of specific country can build the organisation in better way.

How should manager decide the factor of pestle analyse to identified as they should have to
attend?
The manager need to considered each pestle as it will provide the better outcomes and
facts that help to rectify the errors and make the selective approach for betterment of
organisation. In context of IKEA venture, that the mangers get support and they make their
decision on the basis right strategic approach implements as effectively.
PORTER Five forces:
This the model that emphasis about to identify and analyse the significant competitive
forces that determines the strength and Weakness of the particular organisation or industry. In
the background of IKEA Company, this model is used to analyse the internal and externals
scope of opportunity and challenges within business aspects.
 Rivalry in the industry: It is having the intense or high influence of competitions in
global market perspective where many other retail company are high active and customer
are having alternative to approach different retail markets such as Walmart, Tesco Plc,
Asda and Marks and Spencer's company (Đuričin and Herceg, 2018).
 Threat of new entrant: By having the involvement of threat of new entrance is low
influence as the probability of new company enters and face off with IKEA is unstable as
well as they would not able to retain the market share unless their product are effective
enough.
 Bargaining power of Buyers: The influence of bargaining power of IKEA is very high ,
as the competition is rigid in the market and many other companies are actively
participate. So, customer having many alternatives to afford other brand product.
 Bargaining power of Supplier: The IKEA company having low bargaining power
around the global market as demands of the product are manufactured is not in limited
number, as IKEA pursue a strategy to perform long term relationship for their own
suppliers.
 Threats of substitute: The influence of threat of products and services are low as there
are many other trait of products and services are available that can substitute the need of
home appliances or décor, furniture and other range of product which are offered by the
IKEA venture (You and et . al., 2019).

Interpretation- From above porter five forces of IKEA company there is only high influence of
compete with other business existence and high bargaining power of customer that make the
manager of IKEA can make strategy to improve their product productivity better and attain more
market share so, they can reduce the power of customer negotiation.
PART C
The practices the organisation uses to promote and monitor corporate responsibility
Corporate Social responsibility commonly denoted as CSR, refereeing to the practices
and actions taken by the organisation and companies for giving back what they took form the
society and form the nature. Corporate Social responsibility is nowadays known as the most
common and part of the operations of a company. The Corporate Social responsibility practices
performed by IKEA promoting and monitoring are discussed under:
SUSTAINABILITY
In relation to Corporate Social responsibilities local issues and their welfare is the first
aspect which is looked upon. The company focused over the welfare and well-being of local
people, society and communities. The company works for their benefits which leads to creating
employment for local individuals and uplifting their lives. The company make sure to engage
local people in the production and other operations by appointing them and offering work. IKEA
make sure to employee local people for all different tasks such as for deliveries, manufacturing
and other operations. The company engages people for betterment and completion of tasks in
time as they have the common knowledge about the environment and other factors enabling in
fast completion of work and projects on their deadlines. Also, IKEA work for developing better
infrastructure and environment in the workplace for employees in order to give them the most
safe and healthy working surroundings. IKEA make sure to make use of sustainable raw material
and reusable goods for paying back the environment (Davis and Comeau, 2020).
ENVIRONMENT
IKEA works for the society and for the environment too, it has taken several
environmental protection initiatives for preventing and protecting the nature and also for
attracting the larger number of customers specially those who are motivated with such
sustainably operating organisations. IKEA works and operates their functions according to the
environmental guidelines, laws and regulations developed and issued by the government for

protecting and keeping the atmosphere safe. Environmental factors plays a vital role in inducing
the sales and revenue units of company as this is one attraction and promotional ideas used for
keeping close with the needs and requirements of the people those are environment-friendly.
IKEA make sure to take several initiatives every year while progressing for the environment and
for contributing back to the mother nature. The company focuses over creating their value as a
ozone-friendly and sustainably operating firm favouring the environment, the local society and
communities as well as the firm too.
Identify two recent examples of corporate malpractice
Corporate malpractices define those illegal, dishonest and unethical behaviours which a
company perform for their profits and benefits concerning about the environment and any other
parties except the firm (Chukhray and Mrykhina, 2018). In significance to the same two
corporate malpractices which IKEA have adopted are mentioned below:
EMPLOYEE LAYOFF
IKEA, is an international brand which is known for its unique and innovative designs of
furnitures and other offerings. Company has it base in several countries and operate through
number factories. The company has a huge workforce working in factories, as delivery executive
and for other several operations. But company do lay-off employees frequently for the sole
purpose of rapid cost cutting. This is a corporate malpractice which is commonly practised by
IKEA.
AGE DISCRIMINATION
Another example of corporate malpractice being undertaken by IKEA is age
discrimination. Any form of discrimination is not acceptable in organisations, governments have
strict laws and rules against it. But recently IKEA is being hit with its fifth lawsuit for the issue
of age discrimination.
Explain accurately Hofstede’s distinguished five dimensions of national culture
Culture of an organisation plays a major role in its success and establishment, in relation
to the same Hofstede’s five dimensions of national culture is evaluated under in context of
IKEA.
 Power distance, culture describes the power status and various differences between their
members. High power index shows the inequality and the power will clearly shows the

hierarchy in authority. Whereas low power distance index shows the more significant
move towards decentralisation of authority as well as responsibilities.
 Long term vs. short-term orientation, depicts the long term perspective rather than
being concentrated on short-term success and aims. Likewise, short-term put focus and
emphasis on the nearby future and consider short term goals that are oriented towards
today. IKEA adopts long and short-term orientation as the company works for today,
tomorrow and future.
 Individualism vs. Collectivism, shows the degree to consider in which people are
integrated towards the dependence of groups. Individualism be focused towards personal
goals and objectives on the other hand collectivism put the concentration towards well-
being of the group and team. IKEA follows collectivism approach for betterment of
everyone (Čepel, and et . al., 2018).
 Uncertainty avoidance, reflects upon the ability and efficiency of company to manage
the uncertainties and uncertain situations which can create imbalance in the organisation
and in goal achievement tasks. High uncertainty avoidance show low tolerance and high
risk factors and high tolerance shows low risk factors and risk management ability.
IKEA, has high tolerance and have strict rules and regulations to mitigate risks.
 Masculinity vs. Femininity, reflects the overall preferences of society considering the
attitude and overall perceptive towards equal behaviour. For this, masculinity has features
like assertive and concentrated regarding gender roles. Femininity features are like fluid
gender roles, modest and concentrated on the quality of life. Hence, in IKEA, both type
of culture is adopted as the workforce is diverse and mixed.
CONCLUSION
The above report is developed upon the introduction to business management which
concludes that the term business management is a mixture of several tasks and functions. The
business manager has the major responsibilities to make proper measurements for managing and
effectively running the operations of the company. In the report external analysis is conducted by
PESTLE analysis tool and Porter's Five Forces model is used too for knowing the competitive
edge. At last the CSR activities and corporate malpractices are looked upon.

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Online:
Ikea has been hit with its fifth lawsuit in just over a year in U.S. courts, alleging age
discrimination, 2019. [Online] Available Through:
<https://www.fastcompany.com/90310369/ikea-hit-with-new-class-action-lawsuit-
alleging-age-discrimination/>