Strategic Management Essay
Being the supplier of some famous electronic appliances company, Foxconn is affected by scandal about the serial suicide cases of its employees in recent years. The first suicide attempt was happened in 2009 with a 25-year-old employee jumping out from an apartment. In 2010, there are twelve suicide attempts for the employees of Foxconn’s plant in Shenzhen. Therefore, Foxconn has made a lot of effort to rebuild the company’s image. Firstly, some of the ethical issues about the treatment of the employees at the plant in Shenzhen will be addressed.
Ethics can be defined as a standard to decide what is right and what is wrong so as to let people act correctly under different conditions. In addition, ethics can be defined as the study and development of a person’s standard (Velasquez, Andre, Shanks, Meyer, & J. , What is Ethics? , 2010). According to the two suicide cases in 2009, Foxconn’s actions can be said to be unethical when using the rights approach to evaluate. First of all, the human right of not to be injured (Velasquez, Andre, Shanks, Meyer, & J. , 2010) was violated by Foxconn.
Both of the two young employees were beaten by others when they made
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Employees at Longhua plant in Shenzhen live in a small city with factories, apartments, offices and some recreational facilities like sports facilities, libraries and internet cafes, etc. It seems that Foxconn has offered different facilities to balance employees’ work and leisure life. Nonetheless, with the basic salary which was not enough for the employees to consumer outside the city, most of the employees needed to work overtime regularly even on Saturday. They did not have time for recreation. Regulations made by Foxconn were quite strict.
When the employees were working, they are not allowed to speak to each other and not more than two people will be allowed to be walked on the street side by side. The living and working condition is crowded. In the workplace, 900 workers labor were working together on one floor. In the residential buildings, employees live in a bedroom filled with ten people. Under these living and working condition, young employees may feel stressed and without any hope for their future as they work day by day exhaustedly with monotonous work and does not know what is the meaning of their life.
Stakeholder groups in this case includes the owner of Foxconn, employees, customers and suppliers of Foxconn at the same time like Sony, Apple and Dell, customers of those companies and the community like the family members of the employees. For the owner of Foxconn, the main interest is to maintain the good brand image of Foxconn and earn large profit. The main interest for Foxconn’s employees will be their own working environment, career prospect and salary. For customers and suppliers like Apple and Sony, the main interest is to earn profit and maintain own brand image when cooperating with Foxconn.
Apple, Sony and Dell’s consumers will be concerned about the products’ quality and whether the image of the company is good to them (e. g. ethical or not). The community’s main interest will be Foxconn’s treatment to its employees. With the serial suicide case, the owner of Foxconn will be concerning about the negative impact to the brand’s image and the loss of collaboration with companies like Apple and Sony. While the employees of Foxconn may think of whether they should still stay in the company or not. Some of them may even think of whether they should commit suicide also.
Foxconn’s customers and suppliers like Apple and Dell will concern about their customers’ reaction towards the ethical issue. Therefore, they may shift to other companies rather than cooperate with Foxconn. For the consumers of Apple, Dell and Sony, if they think that the products were being made unethically, they will refuse to buy from these brands again. Last but not least, the community, especially the family members of employees from Foxconn will blame Foxconn for the scandal as they mainly concern about the human right of the employees in Foxconn.
According to utilitarian approach, a decision should be make in order to provide the most good with least harm for all of the affected stakeholders (Velasquez, Andre, Shanks, Meyer, & J. , 2010). Therefore, Foxconn should consider all of its stakeholders when making decisions. It should balance its profit and the brand image while providing better working and living condition to the employees so as to comfort the employees, collaborated companies, consumers of those companies and the community.
However, in order to solve the problem of the serial suicide cases, Foxconn only provided psychological training to 100 staff, put up bars and set up “nets of love” to stop people from falling down. They also planned to sell all the dormitories to the government so as to reduce the responsibility. These measures may not be effective because what the stakeholders needed is to let the employees to have the human right and being treated ethically. 100 trained staff was ineffective as the number of employees account to 800000.
For the bars and “nets of love”, it only stops employees to fall from dormitories but not from the idea of committing suicide. Employees can still find other ways to commit suicide. When the employees are earning a small amount of money, selling the dormitories to the government will definitely worsen the situation. In order to tackle the problem of serial suicide cases, Foxconn should improve its employees’ current living and working condition. Moreover, an improved reward system will be a good motivation for the employees to treasure their lives and work hard.
For instance, Foxconn can establish a post of team representative in a 20 employees’ team. When an employee’s performance is the best inside the team, he or she will be able to have bonus and become a team leader. With this measure, employees will be motivated as they can see the hope for promotion. Also, the team leader can help the team members to look after one another. Employees will have a sense of belonging to the team they belong and also to the company. For the main suppliers like Apple, they should have more control for Foxconn.
For example, they can have some unexpected investigation to the factory. Foxconn will then be motivated to treat their employees better as the company does not want to lose the collaboration with Apple, Sony and Dell. With these measures, employees will be able to work in a better working and living environment and Foxconn will be seen as an ethical company so as to comfort other stakeholders. Although it seems that the cost of these measure is quite high, the profit gained from its stakeholders will be larger than the time everyone think Foxconn is an unethical company.
Velasquez, M. , Andre, C. , Shanks, T. , Meyer, J. M. & J. , S. (2010). A Framework for Moral Decision Making. Retrieved March 20, 2011 from Santa Clara University, Web site: http://www. scu. edu/ethics/publications/iie/v7n1/thinking. html Velasquez, M. , Andre, C. , Shanks, T. , Meyer, J. M. & J. , S. (2010). What is Ethics?. Retrieved March 13, 2011 from Santa Clara University, Web site: http://www. scu. edu/ethics/practicing/decision/whatisethics. html