Business ethics report case 14 apple inc ’s ethicalsuccess and challenges

TRƯỜNG ĐẠI HỌC KINH TẾ QUỐC DÂN VIỆN ĐÀO TẠO TIÊN TIẾN, CHẤT LƯỢNG CAO & POHE _ _ BUSINESS ETHICS Report Case 14: Apple Inc.’s Ethical Success and Challenges Họ, tên sinh viên: Phan Phương Anh MSV: 11220575 Lớp : Quản trị Kinh doanh quốc tế CLC 64C GVHD: Nguyễn Bích Ngọc GĐ: A2-808 Hà Nội – 5/2023 I CASE SUMMARY: Introduction: Apple Inc., headquartered in Cupertino, California, has encountered numerous challenges throughout its business history The company's stock price surged from $3.30 to $705.07 between 1997 and 2012, reflecting its remarkable growth However, Apple's journey to becoming a major corporation was not without difficulties, including leadership changes and fierce competition Despite attempts by other companies to imitate and surpass Apple's products, the secret to its success remains elusive Apple has established itself as a brand synonymous with quality, status, and innovation, earning the loyalty of millions of consumers This reputation has enabled Apple to revolutionize both the technology and retail sectors on a global scale Apple’s History: Apple Inc., previously known as Apple Computer, Inc., is a global company engaged in the design, manufacture, and sale of consumer electronics, computer software, and digital media content distribution The company's primary product lines This is a preview Do you want full access? 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Log in include the iPhone smartphone, iPad tablet computer, and Macintosh personal computer Apple sells its products through online channels and operates a chain of retail stores called Apple Stores It was founded on April 1, 1976, by Steve Jobs, Steve Wozniak, and Ronald Wayne with the objective of promoting Wozniak's Apple I desktop computer The company was officially incorporated on January 3, 1977, in Cupertino, California Apple’s first product, the Apple I, was drastically different from the Apple products of today It was constructed by Apple cofounder Steve Wozniak Despite the lack of graphic user interface (GUI), and buyer had to add their own keyboard and display, Steve Jobs persuaded Wozniak that it could be marketed commercially Following the successful launch of Apple Computer Inc., co-founded by Jobs and Wozniak, the company achieved sales exceeding $1 million However, the mid-1980s proved to be challenging for Apple In 1983, they released the Apple Lisa, priced at $10,000, but it failed to gain traction in the market In 1985, internal conflicts led to Jobs being ousted from the company, and Apple faced further setbacks with underperforming products like the Mac I and the Newton Additionally, there were multiple changes in the CEO position These difficulties, coupled with declining stock prices, posed a significant threat to Apple's future In 1997, Steve Jobs returned to Apple to try and save the struggling company Jobs immediately began to change the company’s coroprate from “opened door” to “closed door” policy which was done to prevent employess from taking Apple’s ideas and technologies to another company Apple is still vigilant in securing its technology and ensuring that information remains proprietary Jobs also built a more flattened organizational structure; rather of addressing employees via layers of management, he addressed them directly However, one of the most visible shifts was Apple's growth into new product lines in the electronics business In 2001, Apple introduced the iPod, a portable music player that had a significant impact on the music industry Alongside the iPod, Apple launched iTunes, a software that allowed users to import songs from CDs to their Mac computers, organize their music collections, and manage them effectively In 2003, Apple expanded its offerings with the launch of the iTunes Store, an online platform where users could purchase and download millions of songs for $0.99 each This move reflected Apple's evolution from being solely a computer manufacturer to becoming a key player in the consumer electronics industry As a result, in 2007, the company changed its name from Apple Computer, Inc to Apple Inc., signifying its broader scope and influence in the market Apple began to take marker share away from its major competitors in the computer sector with the introduce of tablet computers such as the iPad which was made the sale of desktops, laptops, and netbooks began to decrease Analysts predict that tablet computers will continue to expand rapidly This is a preview Do you want full access? 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Log in Apple’s Corporate Culture: Apple’s transition from a computer to a consumer electronics company is due to Steve Jobs’ leadership abilities, highly skilled emplyees, and its strong coroprate culture Apple's culture places a strong emphasis on corporate evangelism, which includes both employees and loyal customers These evangelists play a crucial role in promoting Apple's products and creating a devoted following This phenomenon is particularly evident in the "Mac cult," where customers who are passionate about Apple's Mac computers actively advocate for the brand among their social circles Upon Steve Jobs' return to Apple, he introduced two significant cultural shifts: encouraging open discussions and establishing a shared vision that employees could rally behind These changes fostered a sense of loyalty and commitment among many individuals within Apple Apple takes pride in its own coroprate culture, providing applicants with challenges and benefits and motivating itself as a fast-paced, innovative, and collaborative environment Retaill employees that work well in its culture are also sought after, with stations where customers can test and experiment with the lastest Apple products To make sure its retailer employees feel motivated, Apple provides conprehensive training, higher pay, and opportunity to move up to manager, genius, or creative Apple also gives young people the chance to intern with the company or become student representatives at their institutions Furthermore, Apple provides incentives such as transit subdidies for employees who opt to use public transportation in order to lessen its environmental issues Apple's free buses run on bio-diesel These incentives cut employee gasoline expenditures while also decreasing pollutants emitted into the environment Apple Ethics: Apple has established a code of business conduct to promote appropriate behavior among its employees and business partners The code is based on four key principles: Honesty, Respect, Confidentiality, and Compliance, all of which contribute to maintaining integrity within the company Apple has implemented a Business Conduct Helpline to allow workers to report any misconduct, and these reports are reviewed by Apple's Audit and Finance Committee In order to ensure adherence to these standards, Apple requires all its suppliers to sign the "Supplier Code of Conduct" and conducts regular factory audits Apple also publishes an annual Apple Supplier Responsibility Report as evidence of its dedication to promoting responsible behavior among its suppliers Ethical Issues at Apple INC.: Despite the fact that Apple make an effort to improve the workplace, many ethical issues still existed which could have a significant effect on the company’s future success Apple’s sterling reputation could easily be damaged by serious misconduct or a failure to address risks appropriately, including:  Privacy: - Consumer tracking has become a subject of controversy as advancements in technology have provided companies with increased capabilities to monitor and track customers With the prevalence of social networking, mobile devices, and internet usage, companies have greater access to consumer data It is important for businesses to prioritize customer privacy and demonstrate respect in order to avoid negative reactions from the public engaging in such collusion would be highly unethical Subsequently, in 2010, the U.S Department of Justice filed an antitrust lawsuit against the implicated companies, leading to the mandated dissolution of the alleged agreement Tim Cook, Apple's current CEO, emphasized that only Steve Jobs had knowledge of the agreement, and no other Apple employees were implicated in the matter  Supply Chain Management Issues: - Apple takes measures to ensure supplier compliance by implementing a supplier code of conduct and conducting factory audits The company has trained a large number of workers on their rights and increased the number of audited suppliers External organizations are also involved in evaluating Apple's labor practices However, in recent years, Apple has faced significant supply chain issues that have raised concerns about its ethical standing - To meet the demand for its products, Apple relies heavily on production in Asia, particularly within Foxconn factories in China However, allegations of improper working conditions, underage labor, and worker mistreatment have been raised, including instances of suicide These accusations have tarnished Apple's reputation and led to criticism - Despite Apple's efforts to enforce strict supplier compliance standards and conduct audits, more than 50% of audited suppliers have violated aspects of the supplier code of conduct since 2007 Suppliers argue that Apple's manufacturing standards are difficult to meet due to slim profit margins As a result, suppliers resort to cost-cutting measures such as longer working hours and the use of cheaper but more hazardous chemicals - Apple's own audits have revealed noncompliance with working-hour limits (62%), failure to meet safety standards (35%), and inadequate management of hazardous substances by its suppliers (32%) The company has encountered issues with underage workers, falsified records, overcrowded dormitories, and other labor violations Apple acknowledges the need for improvement and aims to enhance supplier conditions while increasing transparency in its labor processes While Apple gives suppliers 90 days to rectify policy violations, the company has dropped fewer than 15 suppliers for such violations since 2007 - Apple's supply chain has faced significant scrutiny due to highly publicized incidents, including chemical-related illnesses, explosions, and worker suicides Foxconn, Apple's main supplier, has a history of labor violations but claims to comply with regulations Some attribute the poor factory conditions to Apple's emphasis on innovation and the pressure to release products quickly, compromising safety standards However, limited alternatives for manufacturing Apple devices make it difficult for the company to switch suppliers Inconsistent labor standards and intense industry competition contribute to similar challenges faced by other electronics manufacturers - Apple asserts its commitment to improving supplier conditions and increasing transparency CEO Tim Cook personally visited Foxconn to evaluate labor conditions and collaborated on initiatives to enhance worker safety The company has worked with the Fair Labor Association and implemented a significant number of their recommendations While progress has been made, continuous monitoring and enforcement of ethical standards are essential for Apple to demonstrate its dedication to the well-being of workers in its supply chain  The Future of Apple INC: - Apple remains optimistic about its future, buoyed by its loyal consumer base and its reputation for providing superior products The company has expanded its presence in the music industry through iCloud, a service that allows users to access their music collections This is a preview Do you want full access? 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Log in seamlessly Apple's dominance in the market is supported by its extensive library of songs and agreements with record labels There are also indications that Apple is venturing into wearable computing with the potential development of an iWatch This move aligns with the growing trend of wearable devices in the tech industry, with competitors like Google, Samsung, and Microsoft also entering the market - To combat investor concerns about innovation, Apple has reportedly been testing larger screens for smartphones and tablets The company aims to refine existing products while continuing to introduce new ones in order to expand its customer base However, Apple faces threats such as lawsuits from competitors over intellectual property violations The company's closed system approach, while protecting its products, may also hinder collaboration and innovation compared to more open-source competitors like Google - The death of Steve Jobs, Apple's iconic founder and CEO, has placed the spotlight on Tim Cook as his successor Cook brings a more traditional management style focused on project and supply chain management While some worry that Cook lacks the visionary creativity of Jobs, others believe his strategic management skills can make Apple more competitive The change in leadership style has raised questions about how it will impact the company's culture - Despite recent skepticism, Apple has a track record of adapting to the rapidly evolving tech industry Its diversification, collaborative culture, and ability to understand consumer needs have propelled its success II QUESTION: Explain how Apple’s philosophy and organizational culture have impacted how it handles ethical decisions: Apple Inc Has established itself as a prominent technology company known for its innovation and distinct brand identity A key factor in achieving this success has been the development of a clear philosophy and organizational culture Apple’s focus on delivering high-quality products has led to a strong emphasis on maintaining a positive brand image The company has implemented measures to ensure ethical practices within its supply chain, such as its supplier code of product and factory audits Apple aims to project an imagee of being an ethical and socially responsible organization Apple's culture of innovation and emphasis on secrecy can create challenges when it comes to ethical decision-making Prior to Steve Jobs’ return as CEO, Apple followed an open-door policy, allowing competitors to gain insight into their statergies However, Jobs swiflty implemented a “closed-door” policy to safeguard their intellectual property and maintain a competitive advantage Apple has also shown a willingness to address ethical concerns and improve its practices The company has made efforts to increase transparency, engage with external organizations for auditing and evaluation, and collaborate with industry initiatives like the Fair Labor Association Apple's CEO, Tim Cook, has personally visited suppliers and taken steps to enhance worker safety and conditions Overall, Apple's philosophy and organizational culture influence its ethical decision-making by prioritizing product quality, brand reputation, and consumer satisfaction While there may be challenges stemming from the company's culture of innovation and secrecy, Apple has demonstrated a commitment to addressing ethical concerns and improving its practices in its supply chain Why is Apple’s industry so competitive and how could this affect the ethical risk in Apple’s operation? 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Log in Because of the rapid pace of technological advancements, which drives companies to constantly innovate and release new products to stay head Furthermore, the demand for consumer electronics, such as smart phones, tablets, and computers, is consistently high, leading to intense competition among companies to capture market share This high level of competition can impact the ethical risks in Apple’s operations in several ways: - The pressure to outperform competitors and meet customer demands may create a heightened focus on productivity and profitability, potentially leading to ethical shortcuts or compromises in areas such as labor practices, supply chain management, or environmental sustainability For instance, in an attempt to cut costs and meet aggressive production targets, suppliers might be compelled to violate labor standards or use hazardous substances - In a fiercely competitive market, there may be a temptation for companies to engage in unethical practices to gain a competitive edge This could include intellectual property infringement, false advertising, or anti-competitive behavior Apple, as one of the leading players in the industry, may face increased scrutiny and pressure to maintain its market position, which could introduce ethical risks if not managed effectively This is a preview Do you want full access? Go Premium and unlock all 24 pages Access to all documents Get Unlimited Downloads Improve your grades Upload Share your documents to unlock Free Trial Get 30 days of free Premium Already Premium? Log in It is important for Apple, as well as other companies in the industry, to establish robust ethical frameworks and compliance programs to mitigate these risks This includes enforcing strict supplier standards, conducting regular audits, promoting transparency throughout the supply chain, and engaging in responsible marketing and business practices By prioritizing ethics and ensuring ethical behavior across its operations, Apple can navigate the competitive landscape while maintaining its commitment to responsible and sustainable business practices How you think Apple has handled the various ethical issues that it has faced in the past? Apple has encountered several ethical challenges in the past, and its methods of addressing these concerns have been a topic of discussion and analysis Here are a few instances illustrating how Apple has dealt with specific ethical issues: - Supply Chain and Labor Practices: Apple has taken steps to improve working conditions in its supply chain It has implemented supplier codes of conduct and conducts audits to ensure compliance The company claims to have trained workers about their rights and increased the number of supplier audits However, reports indicate that violations of labor standards still persist among some suppliers This is a preview Do you want full access? Go Premium and unlock all 24 pages Access to all documents Get Unlimited Downloads Improve your grades Upload Share your documents to unlock Free Trial Get 30 days of free Premium Already Premium? Log in Apple has faced criticism for not taking more decisive action in holding suppliers accountable and for the ongoing challenges in improving labor conditions - Environmental Impact: Apple has made efforts to reduce its environmental footprint The company has set goals to increase the use of renewable energy, reduce greenhouse gas emissions, and minimize the use of hazardous substances in its products It has also made progress in recycling and responsible disposal of electronic waste However, there have been concerns about the company's supply chain's environmental impact and the overall sustainability of its products - Privacy and Data Security: Apple has positioned itself as a champion of user privacy and data security It has implemented features such as endto-end encryption, strict App Store guidelines, and privacy-focused user controls The company has resisted requests from government authorities to provide backdoor access to user data However, Apple has faced criticism for its handling of certain privacy incidents, such as the iCloud celebrity photo leak, and for controversies surrounding its cooperation with governments on data access - Intellectual Property and Patent Disputes: Apple has been involved in various high-profile patent disputes with competitors The company has actively defended its intellectual property rights This is a preview Do you want full access? Go Premium and unlock all 24 pages Access to all documents Get Unlimited Downloads Improve your grades Upload Share your documents to unlock Free Trial Get 30 days of free Premium Already Premium? Log in through legal action, seeking injunctions and damages While some argue that these actions are necessary to protect innovation, others criticize Apple for engaging in patent wars and stifling competition Overall, Apple's response to ethical issues has been a mix of proactive measures, ongoing challenges, and areas of improvement The company has made efforts to address concerns in its supply chain, environmental impact, privacy, and intellectual property However, there are differing opinions on the effectiveness and adequacy of Apple's actions, with critics arguing for more transparency, accountability, and stronger enforcement of ethical standards SOURCES Business Ethics: Ethical Decision Making and Cases – Tenth edition [ CITATION Bro131 \l 1066 ]