SOCIAL PERFORMANCE AT APPLE INC 6
SocialPerformance at Apple Inc.
Accordingto Lawrence and Weber (2014), the current business environmentdemands firms to engage in initiatives that address the needs ofstakeholders. The concept recognizes the great relationship betweenenterprises and societies. The paper seeks to examine the socialperformance of Apple Inc., including the corporate socialresponsibilities, stakeholders, and implications to businessperformance. The primary stakeholders in Apple Inc. include clients,society, government, employees, and stockholders. Integration of CSRstrategy is a major step towards addressing the needs ofstakeholders. Over time, business standards have augmented theimportance of social performance beyond the problems affectingcommunities. When analyzing a company’s social performance, it isprudent to explore both external and internal business environment(Lawrence & Weber, 2014).
AppleInc. is a multinational technological firm that manufactures personalcomputers, mobile phones, and consumer electronics. The company isnotable for the production of products such as iPod, iPhone, iPad,and Macintosh. Some of the services include Apple Pay, Apple Store,iTunes Store, and iOS App Store. The company also manufacturesdigital music players and other communication devices, includingtheir applications. Other products include iOS operating systems,Apple TV, Mac, and the OS X, among others. The company’s productsare regarded to be of high quality and unique. The features are areflection of innovative culture at the organization. It is known forthe production of innovative products and services, a trend thatdraws great inspiration from one of the founders, Steve Jobs(Lashinsky, 2012). The uniqueness of the products and services makethem preferable to many clients. Most of the products and servicesremain highly competitive despite stiff competition from othermanufacturers. The company outsources most of the productionprocesses where it has manufacturing plants in China (Lashinsky,2012). Environment impact and supply chain are two important areas toconsider when examining the company’s social performance. Forexample, chemicals sued in the manufacture of iPhones and iPads havebeen found to be a health hazard.
Thefirst key factor affecting Starbucks future success is competition.The company’s products are continuously facing increasedcompetition from opponents, such as Samsung, due to lack ofinnovation as well imitation of its patented technology. Currently,it is hard to find a significant level of innovation for Apple’sproducts compared to the competitors. For example, Samsung Galaxy Spresently surpasses the iPhone (Reisinger, 2013). The continuedincrease in competition indicates that innovation has taken a backseat at Apple. It further provides a threat to the company’s futureincome as consumers are attracted to more innovative products fromSamsung (Reisinger, 2013).
Thesecond external threat faced by the company is bad publicity. TheChinese government has accused the company of arrogance andcriticized its warranty policies. Bad publicity threatens thecompany’s contracts with clients and can greatly affect itsfinancial performance. For example, the Chinese government announcedplans to build its own Linux based processor as a strategy to reduceoverreliance on Apple’s computers. Such a move poses a threat tothe organization’s future as China might later impose restrictionson the purchase of Apple’s products, which would further weaken theearnings position (Reisinger, 2013).
Theprimary stakeholders have a significant influence towards theorganization’s financial and business performance. To begin with,employees contribute significantly towards ensuring that the productsand services are available to the consumers. Workers are consideredvaluable assets in any organization because of their contributiontowards meeting the goals of a company. Apple Inc. has over 116,000employees who have a direct influence on the nature of products andservices. Employees also play a crucial role in meeting the expectedstandards and quality of products/services. Moreover, the members ofstaff act as the link between the company and clients (Lashinsky,2012).
Theclients form another group of stakeholders who have significantinfluence in enhancing the organization’s financial performance,especially, those who purchase products and services from the Apple(Chandler & Werther, 2013). Customers drive the company’smarket share and business portfolio. Without the clients’ input,Apple Inc. cannot sustain its operations for lack of operatingrevenue. In fact, the business would not be sustainable in theabsence of customers to purchase the products. Apple Inc. needs toproduce innovative products/services continuously to satisfy theclients’ needs.
Stockholdersalso have a great role in enhancing financial and businessperformance. The group contributes the capital required forfacilitating business functions such as expansion. Their input cannotbe underestimated, particularly when monetary support is required(Chandler & Werther, 2013). Often, the stockholders approve majordecisions and policy directions for the company. Another group iscomprised of suppliers and distributors. The two play an essentialobligation in the supply chain process. Suppliers provide essentialservices and products to manufacture the final products/services.Samsung and Nokia, for instance, supply components to the companyused in the production of iPhone.
Thesociety is another important stakeholder whose contribution towardsenhancing the company’s status cannot be ignored. Reputation isinstrumental in luring clients into using the firm’s products andservices. The government has significant input as it develops lawsand policies that influence business outcomes in the industry.Thenature of the relationship between Apple Inc. and stakeholders hasconsiderable influence on the efficiency, operational costs, andprofitability (Chandler & Werther, 2013).
Despiteits immense success, Apple Inc. has come under criticism for doinglittle to improve the working conditions at the outsourced plants inChina. Workers in many Chinese factories are subjected to poorworking conditions, including long working hours, overcrowding, andexposure to toxic chemicals. Foxconn Technology Group is among thesuppliers where Apple Inc. has scored poorly on social performance.Unfortunately, the firm has only requested suppliers to improve theirworking conditions instead of taking proactive steps to address thematter. Inhumane conditions are not conducive for employees as itundermines their contribution. The safety of work environment putsthe health status of employees at risk (Watch, 2015).
AppleInc. has no legal liability for activities taking place in theChinese factories where they outsource most of their functions. It isclear that the company fails to consider morally right issues. Infact, it is a case where socially responsible actions are not in thebest interest of an organization. Improving the working conditionsmay lead to increased operational costs although it is critical andnecessary in the current business environment (Watch, 2015).
Inconclusion, Apple Inc. should evaluate its business models from thecustomer’s point of view for the improvement of customer loyaltyand revenue. With high competition, competitive advantage is based onthe need for the development of innovative and tactical strategiesthat support the business processes. Tim Cook’s leadership has itswork cut out to engage in social initiatives that will enhancebusiness sustainability in the current environment. Better managementsystems in supply logistics are necessary to improve the company’ssocial performance. Apple Inc. should look beyond the financialresults, but also ensure stakeholders’ interests are considered atall times.
Chandler,D., & Werther Jr, W. B. (2013). Strategiccorporate social responsibility: Stakeholders, globalization, andsustainable value creation (3rded).Los Angeles, CA. Sage Publications.
Lashinsky,A. (2012). InsideApple: How America`s most admired-and secretive-company really works.New York, NY: Business Plus.
Lawrence,A. T., & Weber, J. (2014). Business& society: Stakeholders, ethics, public policy. Stakeholders,ethics, public policy (14th ed).Boston, MA: McGraw-Hill Irwin.
Watch,C. L. (2015, Feb 11). Analyzing labor conditions of Pegatron andFoxconn: Apple’s low-cost reality. ChinaLabor Watch.Web. Retrieved on July 25 fromhttp://www.chinalaborwatch.org/newscast/428
Woyke,E. (2014). TheSmartphone: Anatomy of an Industry.New York, NY: New Press.
Reisinger,D. (2013, January 4). Apple faces 10 threats to future growth,prosperity. Eweek. Retrievedon July 25 fromhttp://www.eweek.com/mobile/apple-faces-10-threats-to-future-growth-prosperity