Corporate and Social Responsibility of Apple Inc - Report Example

Apple Inc social responsibility Apple Inc social responsibility Apple is a manufacturer of consumer electronic that is best known for its PDA that goes with the name of iPhone. The firm is a leader in its industry and has managed to garner a lot of success in the market. This has been achieved through leading innovation and understanding of customer needs even before customers are aware of these needs. As a result, the firm is always producing new technology products especially phones, entertainment electronics and computing electronics. A good example is their smart phone called iPhone that has come to be synonymous with smart phone (Brady, 2007). When the market thinks of a smart phone, they think of Apples iPhone. The firm is estimated to have the majority of the smart phone market with the main competitors being the Research in Motion of Canada, Samsung of North Korea and the upcoming Huawei of China. On its launch of the Smartphone, the firm was able to sell over ten million units within a month which was a record not only for the firm’s product sales but also for the market. New version of the same product has been very successful with million units in sales made for each new version which is after every two years. Apple has proved to the world that it is a future firm and that it is here to stay. This has to do with its history of innovation and surprising the consumers with new products just when the customers thought they had everything there is to have in the electronics industry. Generally, Apple is a successful company with a growing future. Though it faces threats such as competition from other providers in its line, it stands a better chance for success due to opportunities and market venture it has not touched. Competitors and the market While Apple is a leader in the industry, this does not mean that the firm does not have competition. The main competition is from Research in Motion who is the manufacturers of yet another market leading Smartphone, Samsung, which is a Korean electronics manufacturer that is catching up very quickly with the American manufacturers and finally Huawei which is a Chinese mobile communication devise manufacturers who have recently entered the market for Smartphone (Russolillo, 2012). Huawei especially offers a very different kind of competition because apart from having the advantage of the Asian cheap labour from china, it has a very keen focus on manufacturing low cost Smartphone and have entered into strategic coalitions with such giants as Google and a number of mobile phone operators in the world. The market in which Apple is very competition and the competition is reaching perfection (perfect completion) especially due to the globalization of commerce. The main challenge in the industry is the uncertainty of the industry (Brady, 2012). The firms in this industry including Apple have to always be on their toes because if any of the other competitors come up with a leading edge technology their products would be rendered obsolete in a matter of one day. As a result, Apple has to continuously invest hugely in research and development to continually come up with the next being thing in their product lines. These huge research costs have to be reflected in the price of the firm’s products and thus the demand is pushed down. However, because Apple focuses on the upper market, the competition is lower on it especially with regard to the fact that the firm is a leader in the market (Gwen, 2004). Pricing strategy of Apple Inc Apple’s pricing strategy is that of price or market scheming. As discussed above, apple is a leading technological firm and most of its products are usually market-leading products. In other words, Apple leads, others follow. The implication of this however is that the firms has to incur more research and development costs than its competitors and the firm has to recover as much of this as possible before the technology they have invented floods the industry. To do this, they have to sell their products at high prices at first to recover the research and development costs. This kind of pricing works for any innovative product because the high-end market is not shy of spending a few more dollars on cutting edged product when it is new to the market before everyone owns it (Barnes, 2012). It works for Apple very well because their products are very innovative and usually when they launch a product, it is new and of its own kind. Apple also launches new products and new versions of these products very often and this means that the firm is able to benefit from price scheming because every occasionally they will have a product to be introduced into the market. However, with new competitors such as Huawei showing up in the market, Apple may need to review its pricing strategy and consider producing products that are specifically directed to the low-end market rather than producing expensive products. Further, the company schemes its products down to the low-end market. A good example of Apple’s competitor that is using this strategy is Huawei and it is doing this by producing both products for the high-end market as well as for the low-end market (Brady, 2012). Cost categories Research and development R&D costs are the highest costs that Apple has to deal with. As explained, Apple is a leader in the industry and this means the firms has to invest a lot in research and development. As a result, these costs can be said to be well managed and there is no need to revise them since the driving force of the firm is based on the research and development. Investing in research and development has helped Apple to a have a firm grip on the market. A good thing to know about R&D costs is that there are no boundaries and the firm’s management has been prudent in identifying how far they should go in terms of funding their research and development. The firm can use metrics and historic data to determine the relationship between the amount of finances invested in R&D and the returns on sales and profits. This can be used to identify the equilibrium and identify the optimal investments in research for Apple (Barnes, 2012). Salaries and wages, labor Salaries and wages have become a very big problem for American firms and most of them are doing whatever they can to make sure that they are able to cost on costs. One strategy that most of these firms are using includes migrating manufacturing jobs to places where the cost of labor is quite low such as in Asia (Russolillo, 2012). Apple has already done this and most of its manufacturing jobs have been exported to China to help in cutting labor costs. However, this is not a long term plan because research has shown that as more and more firms transfer their labor to China and India, the cost of labor in these places is increasing to fulfill the laws of demand and supply (Gjølberg, 2007). Apple social responsibility programs Apple Inc guaranteed "social obligation is key to their method for working together". As to, it said every one of them are obliged to "give safe working conditions", "treat laborers with poise and admiration" and "utilize earth and capable assembling techniques". The Apple Supplier Code of Conduct includes five territories: Labor and human right, wellbeing and security, the earth, morals and administration duty. Apple said it might screen the social obligation execution of its supplier and end business with the individuals who neglect to meet Apples desire reliably. Apple social obligation programs i. Extended the agreeability overseeing project: expanded the no. of offices examined ii. Expanded its preparation activity: have prepared more than 300,000 laborers on their right and assurances under neighborhood law and Apples code iii. Dedicated extra assets to secure specialists from different nations: scanned for right violations and repaid cheated recruitment free iv. Prevented the employing of underage specialists: gave age-check devices, taught offices to oversee outsider scouts, obliged suppliers to return underage laborers to class and fund their training v. Mapped the utilization of potential clash minerals Apple Inc said it executed consistence observing system which included industrial facility reviews, curative activity arranges and in addition confirmation measures to guarantee suppliers agreeability to its set of accepted rules. Reviews were carried out by Apples inspector and backed by outsider reviewer. Throughout reviews, reviewers cross-referenced date, audited records and assessed plants, quarters and feasting territories and also directing meetings with specialists. At that point, reviewers might assess offices level of agreeability and distinguish regions of change in the underlying administration framework. Offices are obliged to actualize curative movement plan if violations were found. Corrective activities arrangements tended to not particular violation issues, additionally the administration framework prompted those issues. There are additionally confirmation reviews to guarantee the remedial movement arrangements were executed. Apple ethical standards Work and Human Rights Apple Inc accepts all laborers in our production network merit a reasonable and moral working environment. Specialists must be treated with the most extreme respect and appreciation, and suppliers might maintain the most elevated models of human rights. Antidiscrimination Supplier should not victimize any laborer dependent upon age, handicap, ethnicity, sexual orientation, conjugal status, national birthplace, political association, race, religion, sexual introduction, or union participation, in enlisting and other job polishes. Supplier might not oblige pregnancy or therapeutic tests, aside from where needed by relevant laws or regulations or reasonable for work environment security, and should not shamefully separate dependent upon test effects. Against Harassment and Abuse Supplier should focus on a working environment free of badgering and misuse. Supplier might not undermine laborers with, or subject them to, merciless or insensitive medication, including however not constrained to verbal ill-use and badgering, mental provocation, mental and physical pressure, and sexual provocation. References Brady, S. (2007, September 07). Apple, iPhones, and Demand Curves, and “Price Discrimination”. Retrieved April 21, 2014, from Professional Notes: http://theprofessornotes.com/archives/224?utm_source=rss&utm_medium=rss&utm_campaign=apple-iphones-and-demand-curves-and-price-discrimination Barnes, R. (2012). Economic Indicators: Gross Domestic Product (GDP). Retrieved April 21, 2014, from Investopedia.com: http://www.investopedia.com/university/releases/gdp.asp#axzz25sz9sORt Gjølberg, M. (2009) ‘The Origin of Corporate Social Responsibility: Global Forces or National Legacies?’ Socio-Economic Review, Vol. 7, No. 4, pp: 605–637. Gwen, C. and Hill, T. D. (2004) ‘Towards an ISO for Corporate Social Responsibility’, Quality Congress. ASQ’S … Annual Quality Congress Proceedings, Vol. 58pp:135-146. Russolillo, S. (2012, August 20). Apple Market Value Hits Record High. Retrieved April 21, 2014`, from Wsj.com: http://online.wsj.com/article/SB10000872396390444443504577601672529621052.html Read More