FOXCONN CASE ANALYSIS
Foxconn Technology Group (A) – Individual Case Analysis
Kamil Shafiq
MNO2302
February 7, 2014
Professor Wu Pei Chuan
Objective
This case study highlights the implications and challenges that arose subsequent to the string of employee suicides at Foxconn Technology Group in 2010. The objective here is address some of the issues facing Foxconn which include supply chain responsibility, human capital management, occupational safety, its declining stock price in the midst of surrounding market pressures and the broader institutional context of China’s social policies.
Foxconn Employee Work Life
The average Foxconn employee is only 21.1 years old, the majority of them (85%) do not have any education beyond high school and were thus low-skilled workers, mostly migrants from cities such as Henan, Hunan and Hubei.
Jobs at Foxconn remain highly sought after primarily for their wage rate, which despite being low, pay more than other manufacturers. Unlike other factories, Foxconn offers subsidies for housing, meals and insurance, and free dormitories. In addition, Foxconn engages in legal contracts with their employees which ensures timely, stable and complete pay, something other firms do not provide. For this reason, thousands line up outside the factory in hopes of applying to Foxconn (Appendix A). Despite this, it is clear that employees have not had a positive experience working there, and that it is not a great place to work. Part of this can be attributed to the company culture.
By Mr. Gou’s decision to break down the production process into many simple tasks, workers perform monotonous and repetitive motions to comprise the long 16-hour work days. Furthermore, bathroom breaks are limited, workers were frequently yelled at and there was no speaking allowed on the production line. These practices do not help foster any employee capabilities or competencies. It is clear that there is an imbalance in Foxconn’s employment
Kamil Shafiq
MNO2302
February 7, 2014
Professor Wu Pei Chuan
Objective
This case study highlights the implications and challenges that arose subsequent to the string of employee suicides at Foxconn Technology Group in 2010. The objective here is address some of the issues facing Foxconn which include supply chain responsibility, human capital management, occupational safety, its declining stock price in the midst of surrounding market pressures and the broader institutional context of China’s social policies.
Foxconn Employee Work Life
The average Foxconn employee is only 21.1 years old, the majority of them (85%) do not have any education beyond high school and were thus low-skilled workers, mostly migrants from cities such as Henan, Hunan and Hubei.
Jobs at Foxconn remain highly sought after primarily for their wage rate, which despite being low, pay more than other manufacturers. Unlike other factories, Foxconn offers subsidies for housing, meals and insurance, and free dormitories. In addition, Foxconn engages in legal contracts with their employees which ensures timely, stable and complete pay, something other firms do not provide. For this reason, thousands line up outside the factory in hopes of applying to Foxconn (Appendix A). Despite this, it is clear that employees have not had a positive experience working there, and that it is not a great place to work. Part of this can be attributed to the company culture.
By Mr. Gou’s decision to break down the production process into many simple tasks, workers perform monotonous and repetitive motions to comprise the long 16-hour work days. Furthermore, bathroom breaks are limited, workers were frequently yelled at and there was no speaking allowed on the production line. These practices do not help foster any employee capabilities or competencies. It is clear that there is an imbalance in Foxconn’s employment
Cited: Biggs, John . "The Future Of Foxconn: Problems." TechCrunch. N.p., 23 Nov. 2011. Web. 2 Mar. 2014. <http://techcrunch.com/2011/11/23/the-future-of-foxconn-problems/>. Chuan, Wu Pei. "Environment and Strategic HRM." MNO2302 Lecture. National University of Singapore. BIZ2, Singapore. 21 Jan. 2014. Lecture. Greene, Jay. "Riots, Suicides, and Other Issues in Foxconn 's iPhone Factories." CNET News. CBS Interactive, 25 Sept. 2012. Web. 2 Mar. 2014. <http://news.cnet.com/8301-13579_3-57515968-37/riots-suicides-and-other-issues-in-foxconns-iphone-factories/>. Chuan, Wu Pei. "HR Planning & Recruitment ." MNO2302. National University of Singapore. BIZ2, Singapore. 28 Jan. 2014. Class lecture. Heath, Alex . "Photos Of The Apple Supply Chain From Inside Foxconn." Cult of Mac. N.p., 20 Feb. 2012. Web. 2 Mar. 2014. <http://www.cultofmac.com/147527/photos-of-the-apple-supply-chain-from-inside-foxconn-gallery/>. Lai, Richard. "Foxconn Axes Suicide Compensation, Relocating Some Production to Vietnam or Taiwan." Engadget. N.p., 9 June 2010. Web. 2 Mar. 2014. <http://www.engadget.com/2010/06/09/foxconn-axes-suicide-compensation-relocating-some-production-to/>. Chuan, Wu Pei. "Performance Management." MNO2302. National University of SIngapore. BIZ2, Singapore. 18 Feb. 2014. Class lecture. Ready, Douglas, Linda Hill, and Jay Conger. "Winning the Race for Talent in Emerging Markets." Harvard Business Review Nov. 2008: n. pag. hbr.org. Web. 2 Mar. 2014. Chuan, Wu Pei. "Training & Development." MNO2302. National University of SIngapore. BIZ2, Singapore. 4 Mar. 2014. Class lecture.