International Management - Case Study Example

Apple’s iPhones-Not “made in America Introduction: Background information The Apple Company specializes in manufacture and sale of communication devices and other digital appliances. In particular, the company designs and manufactures communication appliances, mobile devices, computers and networking service appliances. Apple enjoys opportunities that are realized through its outsourced production in China through assembly of the sophisticated parts outsourced from various other countries.

Competitiveness of the slogan ‘made in America’ is not as competitive as such other slogans from other countries and thus adoption one like ‘made in China’ presented the company with higher competitive edge within the market.DiscussionThe Chinese market compares favorably in terms of skills, flexibility as well as hard work while compared with the American market. Besides, the company enjoys ease of management of supply chains in China when compared with the same in America and this enables rapid access of the products across different part of the world.

The Chinese government offers subsidies as well as streamlining regulations in order to boost manufacturing industries, which is favorable to Apple Company. However, the main threat that the company faces while operating in China is the threat of having more labor demands as labor organizations gain ground in improving employees’ welfare, which implies increased costs of operations through higher wage bills, which subsequently lowers the company’s profitability (Anon, 34-35). Among other obligations that the Apple company must meet towards its customers is the design and creation of high quality products which will ensure customer value and which will meet health standards for the welfare of the customers.

Besides, Apple Company is obliged to increase persistently in research undertakings in order to keep improving on products offered to the customers.On the other hand, Apple Company is obliged to ensure value for shareholders investments through continued profitability. This explains the efforts that the management puts towards ensuring that the company runs profitably and ensuring that costs are minimized as possible while increasing sales. Finally, the company is in contract with Faxconn Company for assembly of the products and is therefore obliged to keep the company running through continuous supply of raw materials.

Apple Company must also ensure that terms of contract between itself and Foxconn are honored. On the other hand, Foxconn have an obligation to the apple company in ensuring that high quality products are assembled and ensuring efficiency to lower on costs of assemble. The company must therefore ensure that employees’ welfare is checked to improve on the Apple’s market image (Denning para 1-5). Furthermore, Foxconn must ensure that the employees are paid appropriately and that the working conditions are in the right standards.

It is however supposed that perhaps, in the event that the American government would create an appropriate manufacturing environment, then Apple Company would realize higher returns through minimized costs in raw material supply logistics, costs of outsourcing manufacturing as well as the local market lost in the event of outsourcing. The article in the study reveals that only $321 in form of profit was channeled back to the American mother company after the operations outside. This paper supposes the county would also have benefited more with higher employment rates as more two thousand employees would be absorbed.

Nevertheless, manufacturing from America would also be detrimental in the market as the ‘made in America’ trade slogan is shown to perform poorly while compared to others. By the Apple company joining the ‘Fair Labor Association’ and having its audit reports published, the company would enjoy strategic benefits while at the same time suffer some risks. Among the benefits would be the improved publicity and employee loyalty through increased payment and improved conditions of working(Karen, 28).

One would also note that FLA would be effective in ensuring that the company ensures that the company complies with the right terms of employee relations. However, there are strategic risks that the company would face which would include increase in exposure of the company’s information to the competitors. Moreover, involving the FLA would lead to increase in wages for the employees, which would be detrimental to the profitability of the company. Works citedAnonymous, “Case study: Apple’s iPhones-Not “made in America”nd. Print.Denning Steve.

“Apples Employees Have A Hell Of A Ride”.2012. Web. 29 January, 2014http://www.forbes.com/sites/stevedenning/2012/06/25/apples-employees-have-a-hell-of-a-ride/Karen S. “National health plan includes job safety goals”. Occupational Hazards;2000, 62(4): 28