Foxconn Technology was founded by Terry Gou in 1974, specializing in computers, patron electronics, communications, digital content, sales of high-tech companies, and auto-parts. Foxconn is regarded as the greatest and the fastest-growing multinational agency in the Electronic manufacturing services (EMS) industry. (Cheng, Eccles, & Serafeim, 2013)
Foxconn is one of the highest IT base industries and gives the lowest total cost options to its partners. Foxconn Technology and its subsidiaries contain 800,000 employees, which encompass half of its employees from Longhua Science and Technology Park. Additionally, Foxconn is the leading electronics manufacturer that supplies Hewlett-Packard, Samsung, Cisco, Apple, and other world regarded brands.
Continually, the agency is renowned in innovative, creative, and technical development and holds about 25,000 patents worldwide. In 2009, the business enterprise finished revenue of $60 billion, accounting for 26% of the EMS market. (Cheng & et. alt., 2013) Due to the sluggish market changes and the high competition in the science industry, it has led the agency to face a couple of issues and challenges. Furthermore, troubles appeared for the company, such as rigid working conditions, low wages for the employees, no private space, lack of freedom of speech, and associated health problems due to the unsuitable working environment.
Due to globalization, there is an extent to business internalization. This is creating a significant effect on multinational companies while working globally, like unfamiliar work ethics, management styles, competitions, practices, languages, laws, etcetera. (Cheng & et. alt., 2013) The HR managers of the companies are discovering the difficulty in dealing with diverse functions.
They are also facing issues in managing the body of workers\' variety and additionally unfamiliar ways of doing business. This is causing a massive issue in integrating the shared global working values with the diverse cost system. The recent suicidal news at Foxconn has raised many questions about the HR coverage of the organization. In the 12 months 2010, 10 personnel had committed suicide to keep away from ghastly and lengthy working hours. (Integrity HR, Inc., 2012)
One hundred fifty people protested towards the working condition of the organization. Further, in the 12 months 2011, 18 personnel had been injured, and four were dead due to explosions in the factory. (Integrity HR, Inc., 2012) These all led to unheard-of challenges in the business enterprise. After analyzing the article, Foxconn operated by three principles, order, control, and power, which produced intellectual strain for their employees working in the plants. Since employees are used to high physical and mental work pressure in order to beat the competition, it leads to no work-life balance. Further, there used to be a large earnings hole for the personnel working at Foxconn. (Cheng & et. alt., 2013)
They felt unfair towards the effort they put in and also felt low in reputation in the society. Altogether, Foxconn had to face a massive undertaking with suicide, self-injury, and unexpected loss of life. (Cheng & et. alt., 2013) For the company to overcome this issue, they need to delegate an HR framework that would help to preserve sustainability via HR activities. Foxconn should appoint an HR officer of their corresponding locations who would be responsible for reviewing all the core functions of HR that concern organizational culture, worker rights, recruitment, education and development, salary and compensation, etcetera. (Noe, Hollenbeck, Gerhart, & Wright, 2016)
The process contains an alignment of HR infrastructure in sustainable ways. Throughout the process, the HR officer must use a metric based device that would help to measure sustainability performance. Foxconn should ensure that the HR department of the organization is following a broad roadmap for high business effects (Bates, 2011). The benefits of having an officer promoting sustainable ways of operating are that it can increase employee morale, improve the business process, and provide an excellent public image. (Bates, 2011)
As mentioned before, Foxconn lacks heavily in these segments, and that is why they are in the news. For being a multinational company, they need to be able to promote the right working conditions despite how different the policies may be in the country of operation. (Bates, 2011) For companies like Apple, when they are involved with situations such as employment issues, it can hurt their public image because they are a U.S. based company where the working conditions are taken very seriously.
By moving to China and operating in awful conditions, it reflects a poor sense of character on the company. Apple is perceived as taking advantage of a country instead of improving their quality of life and living standards. By allowing a good workflow and communication, employees will feel comfortable to voice their issues when something is wrong.
A disadvantage to this method is that it is a significant investment for a company, especially if they have to start from scratch. Implementing sustainable practices would mean the company will have to retrain each level of employment as well as renegotiation agreements that were signed, such as increased wages, free-living, hours worked, and vacation, to name a few.
The company will also have to update their current mission statement if it does not align with the current goals of the company and vice versa. This could be costly because the company could be in some projects at the moment and if they would have to put that at a halt to update the entire organization culture that will cause some lost business.
Continually Foxconn does just in time manufacturing. If they were to cut hours and employ more people, they could face a loss in profit as well as making deadlines if they are continually replacing people and rotating positions. (Huilin, Ngai, Yuan, Yuhua, Chan, & Selden, 2016) Another way to improve working conditions is for the company to implement unions. In the U.S, unions are slowly fading away.
However, China does not have a system in place where their employees have an advocate. As the article mentioned, many do not write contracts despite that being mandatory. This would be opposed to the labor market regulations mentioned prior (i.e., increased wage, worker rights, etc.) By having unionization, the workers will have a collective voice. (Ozimek, 2012)
The benefit of having a union convey to manage their worker\'s desires is much better than having them individually ask or fail to ask and ultimately harm themselves in the process. They can also frequently negotiate, which allows for an opportunity for better wages and better conditions. As time progresses and the standard of living improves, these unions will be up to date with the company and country policies and allow their members to have a chance for better conditions.
A disadvantage to this method is that they have a significant monopoly on the market, and when they become an option, they are hard to disappear once implemented. (Ozimek, 2012) Also, by implementing a union, it could cost the individuals a monthly fee for becoming a member and maintaining their interest. (LG, 2020) As of the moment, China does not make high wages, so to implement a monthly payment on top could diminish the value of its purpose to the employees.
Labor unions also work collectively and do not like individuality. (LG, 2020) So individuals could be bound by a decision they disagree upon. Lastly, they are a hierarchical system. (LG, 2020) Unions operate based on seniority within the company and only help those initiated. Still, the employees do not feel equal; they have to agree with issues they particularly do not like.
Lastly, the option I would pick for Foxconn would be unions. Despite the disadvantages, unions can have. After doing further research, it seems that Foxconn increased wages but eliminated free living, which defeated the purpose of the wage increase. (Ngai, et. alt., 2016) Since China is strict by having a union to start will allow the collective voice to be negotiated and not make the individual feel singled out.
Also, unions will provide a good sense of opportunity for better working conditions. It can also be a starting point for HR to understand what significant concerns their employees have and how they can adapt to that change.