Corporate Social Responsibility at Apple - Essay Example

Apple: Case Study Corporate social responsibility at Apple A number of factors including its relationship with the employees, the stakeholders and the society within which it operates, influence the success of an organization. To maintain a positive working relationship with the society, organisations develop corporate social responsibility programs that aim to offer various free services and facilities to the adjacent societies. Corporate social responsibility is activities that are developed by organisations to improve their overall relationship to the stakeholders by offering free or subsidized services and facilities to the society. Apple, a major technology and telecommunication company based in Cupertino in California has succeeded in the murky water of mobile technology through a number of initiatives and strategies (Imami, Vuksani, & Gruda, 2013). The company holds the stakeholders and the society at high esteem and this is demonstrated by the level of engagement that it has with the society. The development of corporate social responsibility program by the company has enabled it to maintain a positive relationship and culture with its stakeholders, the society and the employees as a whole. With the death of Steve Jobs, the company has faced massive leadership challenge as it seeks to strengthen its market control of the smartphone industry. The advancement and market growth of Samsung continues to affect the performance of the company’s products and this explains their investment in corporate social responsibility to improve the relationship with the stakeholders (Neffke & Henning, 2013). As opposed to the approaches adopted by Jobs that emphasised the need to introduce innovative technology into the market and not splashing cash in charities and societal activities, Cooks has announced a number of plans aimed at improving the relationship of the company with the stakeholders. The corporate charity-matching program developed by the company seeks to introduce a dollar for a dollar match for the employees. Through this move, the company intends to raise over $10,000 every year and invest the money within the societies across the globe. This move is seen as a new message from the CEO to the stakeholders and the customers that the company is moving towards embracing their contribution and investing in the society as compared to the previous leadership at the company (Imami, Vuksani, & Gruda, 2013). With the change of leadership at the company, the introduction of austerity measures has significantly affected the relationship between the company, its employees and corporate stakeholders. Through the development of corporate social responsibility program, the company seeks to assure the stakeholders that the company is focused towards developing an environment of integrity and respect for the employees and the stakeholders. However, the company has shied away from adopting an open philanthropy into developing programs, which promote trust, openness and internal integrity (McCartin, 2013). Apple believes that education improves the life and employability of members of the society where they operate and this explains the high educational investment that the company has been making. Workers within the supply chain of the company are currently taken through adequate training to improve their skills and ability to produce quality products for the diverse market. In the year 2013, Apple developed different free education and development training for over 280,000 workers across the globe in over 18 supplier sites. The suppliers play a critical role in the development of a better image between apple and the stakeholders distributed across the world (Savitz, 2012). As a result, the company has developed programs that seek to protect employees working for different suppliers against mistreatment and non-ethical work environment. The sourcing of minerals has continued to taint the image of the company as the media has continuously portrayed Apple as a key beneficiary of the civil unrest in the democratic republic of Congo. To ensure that a better relationship exist with its stakeholders, the company has develop a supply chain evaluation program to enable the process of sourcing for minerals to be both secure and transparent (McCartin, 2013). Environmental protection remains a key role of every organization across the globe and apple has not been left behind in developing environmental protection, sustainability and awareness programs. This is achieved through ensuring that the suppliers adopt environmental friendly manufacturing practices at all times. To succeed in this program, the company has outsourced the services of different experts to identify the high risk facilities through an audit aimed at reducing environmental harm caused by processing plants. To demonstrate its commitment to environmental protection, the company launched a pilot of our clean water program to act as a water reservoir for different centres across the globe (Blanchard, 2012). The company has also worked towards the development of freshwater recycling, reusing system to ensure that wastage is eliminated and the sustainability of the environment is achieved. To ensure that the programs are fully implemented and the benefits to the stakeholders felt, the company has continuously engaged directly into the activities of their supply chain participants as a way of ensuring the enforcement of the programs. This has worked positively for the organization and improved its relationship with the stakeholders in the face of leadership changes in the company (Blanchard, 2012). Usefulness of value chain in analysing Apple activities Value chain is significant in the successful production of goods and services by a company and its introduction into the market. Organisations in the manufacturing sector receive raw materials considered an input and process them into finished products in a value addition process before they are introduced into the market and the customers. The evaluation of the value chain of the company demonstrates how it is inbound and outsourcing activities has enabled it remain competitive in the dynamic market of computers and smartphones. To remain on top of the market, Apple manages its own product designing due to the vital role of unique selling points and the position of its assets (McCartin, 2013). The company has developed a customer value preposition that highlights their commitment to the production of high quality products and great customer satisfaction. To demonstrate its commitment to the process of production and design, the company eliminated a prototype that had scratches and initiated a complete overhaul of the same. The company had a production unit in North Carolina with 100 employees where the products are designed and the hardware produced (Imami, Vuksani, & Gruda, 2013). The distribution and sales of the products is also managed directly by the company through its apple stores distributed in different parts across the globe. This is essential in the development of the sales experience with the customer who visits the stores or makes online purchases. This is an essential component of the company’s marketing mix, which has been attributed to its successful marketing and sales. Through direct marketing and sales, the company remains at the frontline and this is beneficial in the process of gauging the customer’s satisfaction and the changes in the marketing. The materials used for the development and designing of Apple’s products are not manufactured by the company but outsourced from outside. The company purchases its semiconductors from its rival Samsung and other companies based in Germany and Taiwan. The memory manufacturing and upgrading devices are outsourced from japan and Korea while the display panels, the circuit boards and the chipsets are bought from different manufacturers in Europe. The source of its precious metals has remained the most contested aspect of the value chain with the media and competitors linking the company to illegal mineral trade in conflict ridden African countries and other parts of Asia (Blanchard, 2012). The company outsources its manufacturing device production due to a number of reasons, most of which have been attributed to the success of the company. The process of developing the circuit boards, chipsets among other components of its devices requires massive assets and capitalization that would result into large investment. To cushion itself from the investments associated with the development of these devices, the company has outsourced its research and development aspect to different companies across the world. However, the decision to develop the design and the software for the products independently has been attributed to the sleekness of the products and their efficiency. It is the sleekness and effectiveness of the designs that has enabled the company to remain a major market force as opposed to the internal component of its devices. The decision to outsource the production of the internal parts of the devices is viewed as a strategic management decision that has enabled the company to concentrate on areas that can improve its market relationship (Cilley, 2011). The company does not manage the plant in china that is considered as one of its biggest production line outside the United States directly. As a component of the manufacturing stage of value chain, the company is managed as a subsidiary of Apple with independent management unit with over 20,000 employees. The standardization of the production process in the organization has enabled it maintain an independent manufacturing unit in a different country with success (Richardson & Evans, 2007). The value chain activities and strategies adopted by apple have enabled it to function effectively and meet the needs of the consumers despite the current wave of new market entrants. Competition from Samsung and noni continue to push the market forces in the industry but the value chain approach adopted by the company has worked to enhance its competitiveness and performance (Wright, 2012). Ansoff matrix strategic application at apple The Ansoff matrix is an essential tool used in the strategic decision making process by organizations to improve the overall performance and competitiveness. The Ansoff matrix has four different dimensions that enable a business to handle two important aspects of new products and new markets, old products and old markets. Therefore, in order to remain competitive and influential in the market, apple can use the four strategies to enable it manage the existing products and develop new products and services based on market surveillance and needs (Sandoval, 2013). This mix includes the development of new markets and penetration of existing markets and the development of new and more market responsive products and finally, the process of diversification. Ansoff’s strategies have been used as a strategy for the development of marketing approaches especially in the event of diversification of operations (Baig & Akhtar, 2011). Based on this matrix, an organisation can adopt four strategies in its marketing approaches, which include the development if diversification approaches market and product development and market penetration. Out of these four strategies, diversification remains the most challenging, which compared to the other three requires a company to develop new skills, techniques and build more facilities (Gillespie, 2014). As part of its market penetration strategy, apple can continue with the sales of the old products by targeting new markets especially in the developing economies where the products were not initially sent. Products such as the Mac computer can be distributed to new and old markets in different parts of the globe especially Africa, a market that the company has ignored considerably. The company should work towards increasing the market presence for its existing product, a process that will provide a traditional and loyal market for its innovations. Using proper marketing tools such as the development of effective sales promotion and advertising approaches and the lowering of its retail prices, apple can increase its market presence. For example, the Mac computer has features that are desired by the market but the price and lack of information on its availability has hampered its market performance (Sandoval, 2013). In the strategy of product development, apple could work towards the introduction of new products to beat the influence that Samsung, its main competitor has gained through the recent introduction of Samsung galaxy S5. The current market under the influence of the company can act as a motivation for the process of product development as the organization has a clear-cut traditional market whose response towards different earlier products can be used in the designing and development of new products. The tradition of innovating and introducing IPhones every year has worked positively for the company and enabled it to stamp its authority in the smartphone market. The introduction of new iPhones annually demonstrates the product development strategy of the organization and its commitment to the introduction of new products (Reisinger, 2013). The adoption of new marketing strategies can assist the company in the strategic implementation of market development as part of the Ansoff matrix. Through the expansion of the geographic area, apple has the opportunity to enter into new markets and increase its market presence across the globe. In 2010, the company demonstrated its commitment to enter into new markets when it posted more revenues from overseas sales as compared to the domestic performance. This demonstrated the organization that increased market development has the ability to increase its overall performance and profitability despite the high competition (Gillespie, 2014). As the fourth component of the Ansoff matrix, product diversification provides an organization with an opportunity to enter into new markets and attract new customers through the introduction of new products. Apple has had a culture of diversification as demonstrated by its product innovation history and this has enabled the organization to remain stable in market control and profitability. The first product line that apple was known for was the Mac computers, but the company later entered the music industry by producing the portable iPods. The company later entered the iPhone manufacturing followed by iPad, a process that has enabled it to maintain a pool of loyal consumers who prefer the products innovation of the company (Reisinger, 2013). However, the company should venture more into smartphone diversification in order to beat the high competition attributed to the growth of its rival Samsung. With Samsung producing low priced smartphones, apple should break its tradition of sleek and classy expensive smartphones and enter the low-end consumer markets by producing low cost smartphones. This will enable it stop the current dominance and monopoly of Samsung whose low priced products are today visible in all sectors of the market across the globe. References Baig, V, & Akhtar, J 2011, 'Supply Chain Management: Value Configuration Analysis Approach: A Case Study', Vision (09722629), 15, 3, pp. 251-266. Blanchard, D 2012, 'Corporate Social Responsibility in the Supply Chain', Industry Week/IW, 261, 5, p. 22. Cilley, J 2011, 'A Road Map for Growing Your Business', Business NH Magazine, 28, 10, p. 32 Gillespie, N 2014, 'Dear Apple and Chipotle: its Hard to Be Socially Responsible When You're Dead', Time.Com, p. 1. Imami, D, Vuksani, G, & Gruda, N 2013, 'Analysis of the Apple Value Chain in Albania', Gesunde Pflanzen, 65, 2, pp. 65-71. 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