Ikea's Entry Mode

Topics: Retailing, Knowledge, Knowledge management Pages: 24 (8044 words) Published: June 1, 2013

School of Economics and Management Department of Business Administration Lund University e-mail: anna.jonsson@fek.lu.se

Research on the internationalisation process and retail internationalisation acknowledges the relevance of knowledge management and organizational learning, even though there is a lack of discussion about the specific constructs and approaches. The central role of knowledge sharing in the internationalisation process is rarely stressed. The aim of this paper therefore is to stress the importance of a more critical discussion about knowledge in theories about internatioanlisaiton and to develop a tentative framework for knowledge and knowledge sharing based upon previous literature about knowledge sharing and the internationalization process (Johanson & Vahlne, 1977, 1990). The theoretical approach is then used to discuss and analyse the case of IKEA’s entry to the Russian market. The purpose of this research should be regarded as explorative - in order to increase our understanding on whether and how general internationalisation theories can be applied within retailing and on the role of knowledge and knowledge sharing. Keywords: knowledge; knowledge sharing; the internationalization process model; retail internationalization; IKEA; Russia Suggested track: Knowledge sharing within and across organizations and cultures

1 Introduction
The retail sector has become more and more international in its outlook and operations (McGoldrick, 2002). Furthermore, internationalization of retailers is often argued to be particularly challenging and complex, especially when compared to manufacturing. Retailers normally need to develop and manage a set of stores on the new market, and thus cannot use a traditional exporting strategy. This will involve the recruitment and education of staff, development of property, contacts with local and national institutional actors, etc. Consequently, the need to develop a strategy for how to share knowledge should be especially crucial for retailers. Still, there is a dearth of research on the role


of knowledge and knowledge sharing as a retailer enters new markets. Researchers focusing specifically on retail internationalisation (e.g. Dawson, 2000, 2003; Doherty, 1999) have expressed the importance of looking into theories about knowledge and learning. Dawson (2003) argues that whilst research has shown that knowledge sharing does occur, research has not focused upon how it occurs, and the latter is a precondition for fully understanding its impact on retail internationalisation. One of the most cited internationalisation models was developed by Johanson and Vahlne (1977, 1990). It is often referred to as the internationalisation process model, sometimes as the learning approach since knowledge is the centrepiece of the model (Fletcher, 2001). However, the model has been questioned for only emphasizing experiential knowledge, i.e. one out of several types of knowledge, and for not explaining the mechanisms for how to share knowledge (Blomstermo & Sharma, 2003; Forsgren, 2002; Petersen et al, 2003). Nevertheless, McGoldrick (2002) argues that the ideas about knowledge stemming from the internationalisation process model would be interesting to develop for the retail sector. The patterns for how retailers expand into new markets also seem to fit with the ideas of the internationalisation process model (Alexander, 1997; McGoldrick, 2002; Vida & Fairhurst, 1998, Vida & Reardon, 2000). A first attempt to incorporate the ideas of the internationalisation process model into retailing was made by Vida and Fairhurst (1998). Vida and Reardon (2000) further develop their approach by relating the internationalisation process model to the stages model for internationalisation (Cavusgil, 1980). Their study supports the relevance of such an...

References: http://www.ikea-group.ikea.com/corporate, 2005-01-22.
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