APPLE GOES

GLOBAL
 GROUP TWO
 Mike Lungu-20150660
 Charity Banda- 20152757
 Clavel Mwela- 20154960
QUESTIONS

 What are the pros and cons for local and overseas labor forces of Apple’s
going global? What are the potential political implications for country
relationships?
 As a U.S. corporation, does Apple and its management have a moral
obligation to provide jobs for U.S. employees first? If this is the case, then
does this put international employees at a distinct disadvantage?
 Is it possible for U.S. managers to organize, motivate and ensure quality in
their Chinese manufacturing facilities?
 Explain challenges of managing employees to ensure job satisfaction in an
MNC host country when you are a manager from a home country ( e.g. SA
firms operating in Zambia) based on changes in international relations and
perceptions
THE BACKGROUND OF
APPLE INC.

 Today Apple Inc. stands as one of the world’s most

innovative company when it come to technology.
The company is responsible for manufacturing
gadgets such as the Macintosh desktop, portable
computer, iPod and iTunes and the famous iPhone.
 Apple Inc. was established in April 1976 by Steve
Wozniak and Steve Jobs (Chief Executive Officer)
then 26 and 21 years respectively. Both were college
dropouts.
 Apple’s growth can be attributed to the ingenuity of
Steve Job whose philosophy has been to
manufacture products that an ordinary consumer
can easily use accompanied with innovative
technology
BACKGROUND CONT’D

 In order to start operations, Steve Wozniak and Steve Jobs had sell
a van and two Calculators raising $1,300.00
 Two months on after developing their first computer circuit board in
their garage, the sold off 200 pieces $666 each. This led to the
launch of Apple II computer that was very user friendly and they
sold over 100,000 units
 Steve Jobs dreamt of having a large company hence he consulted
Mike Markkula a retired Electronics Engineer who later bought 1/3
of Apple at $250,000.00
 In 1977 Mike Scott was hired as the company’s President and Regis
McKenna an experienced Advertiser was recruited charged with
designing the Apple logo and also started massive advertisement
of Apple products in magazines and placing of the products in
various stores
BACKGROUND CONT’D

 Following the placement of the Apple products in retails store, the

company’s annual sales reached $1million. The Apple II was the first
microcomputer to use color graphics and stored data on cassette tapes
though they were not very reliable.
 This led to the development of Apple disk II which was faster and the
cheapest to have been offered by a computer manufacturer
 In 1979 Apple II+ was developed which had a high memory storage with an
easier start up system. The company also developed the first computer
spreadsheet call the VisiCalc which led to sales increasing by over 400%
 In 1984, Steve Jobs left Apple Inc. and replaced by John Scully following
the company posting net losses of about 17%. The losses were attributed to
the products slow processing speed and incompatible software
 BACKGROUND
CONT’D
 Under Scully, Apple was able to drive down costs by shifting
much of its manufacturing to subcontractors. But because gross
margin on Apple products fell to a 10 year low in 1993, Apple’s
board decided to appoint a new company president. This
move prompted Sculley to leave Apple. From 1993 to 1997,
Apple cycled through two more company heads, Michael
Spindler and Gilbert Amelio
 In 1997 Apple was once again under the control of Steve Jobs
and he wasted little time in turning the company turnaround.
He arranged for Microsoft to invest $150 million in Apple
 Today Apple offers a range of personal computing products
including desktop and portable personal computers, related
devices, and peripherals.
 It is one of the world’s best leader in computer products
FRAMEWORKS
DIVERSITY
 Diversity focuses on the multiplicity of differences among people – on the
variety of people as heterogeneous groupings. Individual differences are
the basis of diversity.
 Diversity is defined as : The basic concept of managing diversity accepts
that the workforce consists of a diverse population of people. The diversity
consists of visible and non-visible differences which will include sex, age,
background race, disability, personality and workstyle. It is founded on the
premise that harnessing these differences will create a productive
environment in which everybody feels valued, where their talents are being
fully utilised, and in which organisational goals are met
  Amongst the many theories in Diversity. We have
Cognitive identified 2 models that will help us tackle the matter of
Diversity and globalisation as we examine the case of
Diversity Apple Inc going global. It is on these theories that we
will draw a theoretical framework which will be cardinal
Hypothesis in elaborating our discussion. These theories include the
Cognitive diversity Hypothesis and the Similarity-
Attraction Paradigm
 The cognitive diversity hypothesis developed by Dr
Melvin Conway suggests that multiple perspectives
stemming from the cultural differences between group
or organizational members result in creative problem
solving and innovation.
Similarity-Attraction Paradigm

 The theory that similarities or sameness attract has been

formalized in research since the mid1900s. It was brought
into prominence in 1969 when researchers Ellen
Berschied and Ellain Harfeid conducted research.
 The theory assumes that people are likely to be attracted
to individuals who are perceived to be similar to
themselves.
 “People who share our attitudes and values validate
ourselves and boosts our self-esteem, which in turn leads
to attraction”.
 The theory has worked positively for Apples
establishments outside America in that cultures such as
the Chinese encourages them to embrace each other
and work together.
Cont’d

INPUT PROCESSING OUTPUT

SAME
TRAITS

Gender Job Satisfaction

High
WORKFORCE Religion Attraction Productivity PROFITS
Age
Race
Pros & Cons local & foreign labour force

Pros
 There is elimination of the language barrier
 Using foreign labour helps to understand the host countries rules and
regulations
 It helps in the reduction of costs associated with visas and hiring costs
Cons
 The major challenge is management of the company
 There is lack of understanding of the company’s culture by foreign
managers and general employees
 Challenge of creating the perception of ‘us vs them’
As a U.S. corporation, does Apple and its
management have a moral obligation to provide
jobs for U.S. employees first?
 No, in order to achieve a significant selling margin at the lowest expense
Apple will offer employment to a highly qualified low-cost employees so
that salaries compensation can be smaller.
 US staff are costly employers as they demand medical insurance and other
high-cost fringe benefits, effectively pricing themselves out of the game.
 Any corporation wants to improve its income, and if it is to be the case
through hiring overseas workers, then from a corporate analysis, it will be
the best option for them to raise their income.
 However, from a moral point of view, the organization would first have
employment for local residents .
 Apple has a responsibility to its shareholders to maximize sales revenue at
the lowest possible cost, and in order to do that they need to recruit
talented people of any nationality and pay them as little as possible.
 If they have to choose between two candidates of equal ability they
should pick the one who comes from a low –cost country so that the salary
cost will be lower.
Is it possible for U.S. managers to organize,
motivate and ensure quality in their Chinese
manufacturing facilities?
It is possible for U.S managers to organize, motivate and ensure quality by;
 Engaging the right people for the job with good general management
experience
 Managers should not apply the same type of manufacturing leadership in
China as that of the U.S.A
 Managers should create an ‘ownership’ culture such that deserving
employees are rewarded in proportion to their results
 They should create a development roadmap and promote employees that
deserve it. This will motivate staff and encourage them to work even harder
 Managers can embrace and respect Chinese culture at the workplace
Challenges of managing employees to ensure job
satisfaction in an MNC host country when you are
a manager from a home country
 It has become of an utmost importance for MNC’s to attract, select, develop and retain
employees who can live and work effectively outside o their own national borders
The following points explore Challenges that home country managers would face in ensuring job
satisfaction in a host country.
 Adaptability to the new culture – The manager will have to come up with ways to adapt to the
new environment as they would be dealing with strange and sometimes conflicting cultures
 Attitude and motivation - As a manager, its imperative to develop the right and strong attitude
especially in a strange and new environment. This will not only motivate the manager but also the
locals there by winning confidence. would employ a positive attitude towards the locals.
 Empathy towards local culture – the manager will have to ensure that they acquaint themselves
with the local labour laws and other practices so as to execute their mandate in a compliant
and non violating manner
 The manager will have to practice tolerance, flexibility and open mindedness in order to execute
their mandate especially if they are dealing with individuals with moderate to low literacy levels
 Language ability - the manager will definitely face challenges with communication especially
when it comes to working with factory workers casuals and other non technical human resource.
in this case, learning even the most basic forms of the local language for convenience would be
cardinal.
Recommendations

 Apple should consider taking back the lost jobs (20,000) to the US. This can
be achieved through training and inducting the right people for the job.
Employees need to understand Apple’s vision and culture
 In addition, Apple should consider looking at the market trends and
affordability of their electronics products by an average consumer. The
case study has reviewed that Apple spends quite less on manufacturing
their products compared to the huge profits they make on that product.
Conclusion

 Apple Inc. is one of the world’s leading electronics manufacturing

company in the world
 Globalization and a good understanding of diversity by top management
has made Apple Inc. to achieve this milestone
 Apple’s strategy of moving its manufacturing plants to China which has
cheap labour has contributed to their success story
 Apple has justified their move to go global with the fact that oversees
employees especially those in China are very innovative, skillful, flexible and
industrious thereby meeting the company’s needs in the global market
 The case study has reviewed that the U.S skills deficit and that it could not
match with the fast-manufacturing process in China