CASE STUDY: Home Furniture ltd.

CASE STUDY: Home Furniture ltd.

In 1970, the company Home Furniture was set up. The headquarters are located in Tampere, Finland. Over a number of decades the company has been very successful at producing affordable furniture which is especially favoured by youngsters and families with a small budget. While the company was initially most successful in European countries it is heavily expanding in other regions of the world, like North America and also Arab and Asian countries. The stores of the company are rather independent in their sales policy and differences can be found in the type of products and marketing policies. At the same time the company attempts to create economies of scale with high volumes and by implementing the same formula of logistics where customers assemble the product. The major advantages are low costs for both storing of products and low labour costs.

The parent company employs 1750 employees, made up of skilled and semi-skilled employees. Two hundred employees work in design and development and other highly skilled jobs like strategic management and marketing. Despite the recession in many countries across the world the company intends to expand in some other, emerging economies,

The company s international growth has been organic, first expanding in Europe and then the US and Asia. When entering a market, Home Furniture will attract a small number of local managers at the level of middle management and an expat would guide the initial 4 years. Training would be provided locally. There is however still a need for a consistent expat programme with centrally defined objectives in terms of management development.

With the expansion some problems came up, like the working in teams and providing incentives for individual employees. Management in the US promotes performance pay while the parent company emphasises other aspects of employment relations, like participation of employees through works councils.

In the US both management and unions hold the opinion that work and organisational matters should be negotiated upon when labour interests are at stake. When management from the parent company attempted to introduce teamwork, local management of subsidiaries in the US had a different perception of teamwork “ facilitating the rotation of jobs and increasing flexibility rather than creating more autonomous work groups.

Until 2007 the CEO of Home Furniture was Finnish. Since then, a new British CEO has been making attempts to
improve communications throughout the company. Not only the language of communication changed to English throughout all operations of the company; also the way in which policies are developed and implemented changed. This new communications strategy, which is carried by the headquarters, does not always appear to be in line with the management style in some other countries, like India and other Asian countries.

Another issue the new CEO has to deal with was negative publicity on working conditions in some countries. Some NGOs (Non-Governmental Organisations) have made allegations about unpaid overtime, and health and safety issues within some of the production and sales facilities. These allegations relate to mainly Tunesia and China. Also, especially the Finnish press reported on cases of union busting in some US branches. One of the first decisions the new CEO took was the creation of an HR executive at corporate level. With the start of this HR office an investment was made in a training centre in Tampere. Both the HR executive and the CEO are aware of the need to create a corporate training programme. HR is also aware of the problems the company may experience as the result of variation in reward schemes across countries. The CEO feels, however, that a main task for HR would be to develop instruments of motivation which are relevant for the various countries where the company operates.


The questions below make reference to the case study Home Furniture ltd.. Students must answer the question from section A and answer the question from section B.


Provide the new Home Furniture CEO with advice on the policy she should adopt when operating in various countries and employing people from various countries. Refer to the various concepts and outcomes of research on management across cultures.


At the office in London there are many employees who do not belong to a dominant group of employees “ with regard to gender, ethnicity, age and ability etc. You are asked to develop a policy for diversity management.

a. What are your arguments for developing a policy “ so what is your basic view on diversity and why would or could it be relevant (what is the rationale)?

b. What are the elements of the policy on cultural diversity and what HRM-instruments – like career progression, reward and training – could be applied to the company. In other words, what are the main elements of your suggested diversity policy and its implementation?

NB: although the perspective may be very practical the students are required to refer to various theories. This should be done with the use of proper Harvard referencing “ with both a list of references and in-text referencing. All other requirements apply, like building up an argument and linking practices and policies to theories.

Students are recommended generally NOT to use internet sources, as most of them contain unreliable, and usually very poor information.


1- Please read the case study then answer the question from section A and answer the question from section B.

2- Case analysis

– ALL students need in the analysis to address, in the first section of the analysis, issues of working in a multinational company in various countries with various types of culture and different systems of employment relations.

– The second section of the analysis, will be the analysis of the diversity policy of a company. You should describe and explain approaches towards diversity, especially with regard to national, ethnic and religious diversity, and policies with regard to the management of cultural diversity. Also HRM, being the function within organisations responsible for a diversity policy, should be looked at. Such a policy will also have an impact on reward, selection and recruitment and promotion as aspects of HRM.

3- All references must be from the books and journals.

4- I want you to use 12 references in this essay.

5- Below you find a summary of the marking criteria for all work assessed on this course:

20% Focus

Does the analysis set up a clear question to address? Does the writing stay within and fulfil the topic parameters?

30% Synthesis

Does the essay bring together the literature in a significant manner that addresses an essay question?

30% Soundness

Does the essay indicate a comprehensive understanding of the topic area and literature discussed?

10% Clarity of structure

Is the essay well organised and logically constructed
to achieve synthesis while being mindful of the needs of the reader?

10% Mechanical Soundness

Is the essay clearly written, spell checked and grammatically sound and referenced appropriately?

6- Please do you best in this essay I want get a high mark.

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