Is Apple Going Rotten?

For our crisis discussion, we chose to look at the crisis Apple is having from the unsafe working conditions at its factories in China.

Lately, Apple has received negative press for the working conditions at its Foxconn factory.  Workers allegedly only make pennies a hour, work extremely long hours and perform the same tasks thousands of times over and over.

Here is a video of an interview with one of the workers who discusses what it’s like to work for Foxconn:


Working conditions have been so harsh that they are thought to be the cause of several reported employee suicides.  With the revelation of these harsh conditions, Apple has come under fire.  Click here for an article from the New York Times that exposed the issue.

In 2005, Apple executives made a code of conduct for their suppliers. This code was supposed to prevent this kind of unethical treatment of employees from happening at any factory that worked for them.  The New York Times article pointed out that although Apple’s own annual audits of the Chinese factories showed that the code was being violated, the company seemed to ignore the reports.  What type of position does this put Apple’s PR team in?  Can the PR team do anything to save the image of this company who has broken its own code of ethics?  Click here for an interesting look at Apple’s recent audits.

Although this crisis has been linked specifically to Apple, Foxconn also makes electronics for other companies.  Is it fair that Apple is being solely targeted by the press?  Also, these revelations have brought out another broader issue—overall working conditions in China.  Should Apple have to defend itself for a matter that may be a cultural or national issue in China?  Or should they take a stand against this unethical treatment of employees, considering they are one of the most influential companies in the world? 

Protests of Apple have accelerated recently and it’s obvious that this story isn’t going to fade away in the press.  Protesters have started to hold demonstrations in front of Apple stores and offices.  Protesting hackers have even hacked into Foxconn’s network and caused havoc for the Apple supplier.  These protesters want people to ask themselves this question:  Would you still buy your smart phone or tablet if you knew the conditions in which it was made?  What can the PR team at Apple do to respond to the protesters?  Is there anything they can do?

photo courtesy of lovefortech.com

As of yet, Apple has not formally responded to this imminent crisis.  As we have learned, it is imperative for companies to make a statement about a crisis, as staying silent usually implies some sort of guilt.  As you can see here, Apple has done things differently when it handled crises in the past.  Do you think Apple can continue to deal with crises in this unique fashion, or is this going to come back to bite them sooner or later?

So far, the only “response” has come in the form of a leaked email from Apple CEO Tim Cook. Here is the link to the leaked email.  Do you think this email was leaked intentionally? Is this response enough, or should Apple have made a more definitive public statement?
It appears that the majority of news coverage is attacking Apple.  Although the coverage should probably be targeting the entire electronics/smartphone industry, Apple’s lack of a response seems to be adding fuel to the crisis fire.  Do you agree or disagree?  Also, if you were a PR practitioner for Apple, what type of response would you have made?  Do you agree with how they have handled it so far?

Sam Plymale and Laura Taylor

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20 thoughts on “Is Apple Going Rotten?

  1. I didn’t even realize that people in China are suffering like this, I guess I think that labor laws overseas have been reevaluated. I disagree with the workload and conditions that it seems they are putting on Apple. I would respond with an apology and go from there

  2. I agree with what you said about the labor laws being re-evaluated, Dana. Why exactly do you disagree with the conditions that are being put on Apple? How should Apple go about giving an apology (if they choose to do so)? Should they write a press release or release a quick Tweet about it-etc.?
    ~
    Laura

    • Part of being one of the most famous companies in the world is, well, being known around the world. The way I see it, Apple has an innate responsibility to every place they conduct any production to make sure their stakeholders would be comfortable with what’s going on. Apple may be a great company, but it’s still a company. What do you think Laura and Sam?

      • I agree, Danny! Apple should lead the way on doing what’s right in this type of situation. They have A LOT of influencial power in the world and I think that they could make a really big difference. I believe that EVERY company has the responsibility to make sure that their stakeholders are comfortable with what is going on…but unfortunately, most companies tend to look at what they can do to make the most money without really considering if what they are doing is ethical or not.
        ~
        Laura

  3. I love my iPhone. I love my Macbook. I love my iPad. I love my Apple. And I’m not the only one.

    When an issue of morality might come between Americans and their love-obsession with products that make their lives easier, the product has become, in essence, “too big to fail.” Apple, the white knight of “liberal big business” turns out to be not so infallible after all. In my limited PR opinion, Apple should take advantage of the situation to humanize the (in)famous organization. “Hey, were not perfect, but we’re as hell gonna try to be.”

    Let’s talk Apple business for a moment. There’s a lull of new Apple products at the moment. The anticipated iPad 3 announcement hasn’t come yet, the iPhone 4S is largely considered a mere re-release, and Apple computers haven’t had any substantial announcements either. I think the company, and PR team, should take advantage of the lack of new product news and invest in showcasing the changes they are, and continue, to make in off-shore factories.

    I want to see the headline: “Apple CEO says “Our Bad;” Company revamping off-shore factories”

    Now excuse me, I have to speak with SIRI. She can be demanding.

    • I agree in essence of how huge of a company Apple is, this morality test should be a breeze for Apple to overcome. Every company’s distirbution process is under-handed and very complex, but that shouldnt overshadow the comoanyand what it stands for, but Apple can improve their ideal work ethic that is tooken place in the distribution process.

      • I agree with what you wrote, Danny. Apple needs to take this time to change their policies and gain some positive publicity, too (if the policy change is done right).

        Carm88, what should Apple do to overcome this “test”? Do you think that the company can set new industry standards for product production overseas?

  4. As I’ve followed the progression of this story, it seems to me that the American public may not care that much about this story for various reasons. Here’s an update on the story from CNN.

    http://bit.ly/ArRpDI

    Apple shares are rising? Maybe this isn’t such a “crisis” after all. I’m a little surprised that the American public isn’t reacting more harshly, especially because of the delayed response from Apple’s PR team. I’m going to take an educated guess why. It’s one of two reasons: 1) Many people may be like Danny, and love their Apple products so much that it’s going to take more than questionable working conditions to make them rethink Apple’s practices. 2) The more likely reason is that the questionable practices are taking place in China. If that factory was in the U.S. there would be more outrage, and the company would be suffering from it. Guess there may be other advantages of doing business overseas, not just cheap labor but American apathy for other another culture’s working class. Agree or disagree?

    Also, the headlines are in the making, Danny. A so-called “neutral” or non-profit labor group has toured the Foxconn facility and reports that conditions aren’t as bad as described and actually above Chinese standards. I expect your “suggested” headlines to take shape over the next week or so. This “tour” was by invitation from Apple. Maybe a PR action instead of a verbal response? If so I still think it took a bit too long.

    Sam

    • This is a little bit shocking Sam, but at the same time it’s not. We, as consumers, want what we want, but very seldom realize the cause and effect. How often does one truly think about where their food comes from or clothes, or furniture – or pretty much anything we use and buy?

      This really is an international crisis situation. We have American companies sending work overseas… we have overseas companies with thier own set of labor relations issues – is there a fix?

      I would think that Apple would come out and respond more strongly. Others who have experienced labor relations like this have been more public and taken corrective action quickly. http://www1.american.edu/ted/kathylee.htm

      Gina

  5. Apple is a huge company that is looked upon their products more heavily than the actual process of making those products. However, i’m not saying that this gives them any excuse has to how they conduct their employees and expect those employees to work under stress conditions. We also have to consider that these distribution centers are off-shore, which varies their standards on work conditions, wages, responsibilities, and more. Apple distribution (or factory) conditions shouldnt have a major effect on their company and its brand. Name one company that has a easy-going distribution (under-handed) process? In my opinion, there’s not many! If I was a PR professional representing Apple, I would provide the public with what goes on behind close doors, and explain why these conditions are the way they are, and apologize for any misconception of complexing Apple’s brand with the way they conduct their distribution process; and how the values, and morals have nothing to do with the meaning of Apple and it’s brand.

    • Humans, unfortunately, tend to look at the final product instead of the process that’s needed to get there. It really makes me sad when companies will put the lives of others in harm’s way (as if they’re replaceable and insignificant) just to make money. I do believe that a company’s values and morals have a lot to do with the meaning of the brand. For me, a brand is what a company says, does and supports. When Apple doesn’t correct issues (such as this crisis in China) it shows that they have a failing moral; they’d rather make a quick buck instead of ensuring that their company’s ethics and morals are followed through.

      • You’re right, Laura. A company’s morals and ethics are definitely questioned when it comes to issues like this. Seeing as how the PR practitioner is supposed to be a company’s moral compass, I don’t see how they would let them stay quiet about this. Even if it’s not a huge press conference, something should be released that expresses Apple’s concern about these conditions. The public views silence as guilt or approval, so staying quiet is only making this situation worse. It’s really sad when companies view their employees as machines, as the women said in the video, instead of the human beings they are.

        – Cherese

  6. I disagree with the way they are treating workers over in China but I don’t blame Apple for not addressing this publicly. China has their own domestic problems and it effects their society when it comes to wages and how workers are treated. There issues stem from more cultural problems oppose to problems with Foxxconn and the Apple Brand. There is an issue with the numerous audits that should be more heavily investigated internally before It begins to affect the product and hurt sales. Apple has always been one of the hottest items on the market and they continue to strive and make the most popular electronics in the market. If something was publicly said it may offend someone and hurt their business along with their image. Honestly Apple wouldn’t take a huge hit in their sales and I-Pods/I-Phones would still be the most desired product out because of the lack of competition apple faces. The e-mail that leaked out seemed like a strategy by Apple to inform people but not mention it to the public, nut not make it a big newstory that could bring negative attention. Apple is such a powerful business that they will always make money but they need to be a little more hands on and proactive on attending to their employees over in China so that their reputation doesn’t take a hit.
    *Kyle Smith

    • Kyle, you said that these issues are caused from cultural problems instead of the business practices that were used. Can you expand on that? Do businesses, such as Foxxconn and Apple, have the opportunity to positively affect and change the cultural issues where they are based (or is it the government’s responsibility to do so)?

      • I feel that the company has a posotive influence on the society and it’s people. It all comes down to the goverment stepping in and fixing things when people are treated unfairly so that the issue doesn’t become even bigger and out of control.

      • Like Kyle said, I think it ultimately comes down to the government making the actual changes. I do, however, believe that Apple can be a big influence in making those changes. Hopefully, other companies will step in as well. These companies have the business that Foxxconn wants, so they should be taking advantage of that special power instead of taking advantage of the cheap labor they’re getting.

        – Cherese

  7. My first thought on this is “OH MY GOSH” how can this really be happening to such a world known product. CRAZY!

    I don’t believe that it’s fair that Apple is solely being targeted if Foxconn makes other products but I can understand why. Apple is a household name. The Press could only be making an example of them to other companies to show that if this is how your running your business, it will be exposed. Also, a lot of people love, support and use Apple. The press is making aware to the public what’s going on behind the scenes of these products.

    I don’t think Apple should have to publicly defend itself, just make the proper changes. In the New York Times article, Nicholas Ashford quotes, “What’s morally repugnant in one country is accepted business practices in another.” I am no expert on business practices in China but i’ve always heard their working conditions are poor. If that’s just how things are done I don’t see why they would want to publicly defend themselves. It could even hurt Apple by informing people who don’t know about this issue, I sure didn’t, and make them aware and angry about it, as am I right now.

    Without making the management of these Apple factories change the working conditions, i really don’t believe there’s much that the PR team could do to respond to the protesters. The protesters have a legitimate reason to protest, People are getting hurt, sick and killed.The Apple PR team could keep focusing on that workers are being treated fairly and keep talking about the increased pay, the provided counselling and on site health care which was mentioned in the YouTube video “Less Than $1 an Hour to Make iPads.”

    I believe that Apple is in need of a change. As mentioned in the YouTube Video, “Less Than $1 an Hour to Make iPads,” people don’t stay long at Foxconn but people are always looking for jobs. I believe something, hopefully soon, will bite Apple in the butt and the necessary actions will be taken place but Apple is a power company. It has changed technology. It clearly does what it wants.

    I 100% believe that that e-mail from Apple CEO Tim Cook was leaked intentionally. That e-mail to his “team” is not a public statement. He needs to address these issues to the public. The people who love, use and buy these Apple products have a right to know what’s really going on. Companies should be credible and always be open and honest and it does come as a shock that Apple hasn’t made changes in their factories. By Apple not addressing the public, it’s definitely adding fuel to the fire. If I was the PR Professional for Apple, I would want myself as well as the company to be open and honest. If Apple didn’t make the necessarily changes, I don’t know if I would be able to work for a company that I didn’t believe in and support.

    Kaitlyn Horbal

  8. Wow. I was just reading an article about Apple passing Google for the title of most respected company and image. Plus, they came in second after Whole Foods for best social responsibility. Hmm…

    Anywho, I don’t think it’s fair that Apple is the only company being called out, but it’s Apple. It’s a part of being one of the most influential brands. They claim to care about all of their employees in every work location, so now is the time to really prove it. They should come out and say something against the conditions, especially since there have been prodromes within the company itself. Clearly, more changes need to be made.

    You raised a good question about whether I would still buy an iPhone after hearing this. Considering I don’t have one already, this is definitely not going to make me run out and get one. However, if I was an ‘iPhoner,’ I would probably still use it or buy it. I mean, how often do we see things like this and actually completely turn off of something? I’ve seen Food Inc., yet I still may eat a piece of chicken here or there. I think in our minds we know it’s wrong to support a company that treats their employees like this, but because these things have become a part of our every day lives, we can’t shake them.

    The email seems like it was leaked purposely. I saw it as Apple trying to address the public without actually releasing a statement or apologizing. I guess it was smart in a sense that only the people who are interested in the story will read it. The part that’s going to come back and bite them is when the story spreads and people see that Apple never made a statement or took any steps to change things. By making some kind of formal statement, Apple can inform their publics and somewhat ease the concerns of the protestors.

    As a PR person, I would suggest publicly making strides to improve conditions. It will please those who have been following the story and serve as bonus social responsibility points in the eyes of consumers who are in the dark. They can’t make China change any of their cultural business norms, but they can definitely bring attention to it.

    Tomorrow “Nightline” will air an exclusive full report from inside the ‘iFactory.’ This is the first time cameras have been inside Apple’s facilities. Is this their way of trying to be transparent? Will it depict what’s really happening on the other side of those doors?

    Here’s the link: http://abcnews.go.com/International/trip-ifactory-nightline-unprecedented-glimpse-inside-apples-chinese/story?id=15748745#.T0Jr1CNPHmx

  9. It’s unfair that apple could get out of this stretch free but with apples reputation that’s likely. Having workers work for 75 cents to make a $750 iPad seems like the strategy used in a tv show from a bad guy. But apple, from a corporation standpoint should deny the “rumor” of their workers pay. Or this situation will likely turn horrible immediately

    -antonio

  10. Pingback: China to Apple: Pay Up! « how i C it

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