1000 workers riot in Foxconn factory.

I was having dinner last night with a good friend who's opinions I value. He said that I come across in this blog as a bit of an Apple hater and that I should tone it down.  If anyone else thinks this then I apologize. Apple is no worse than any other US brand making in China. My goal here is not to vilify Apple so much, rather it is to point out some obvious inadequacies in their Labor Compliance process.

Unless they focus on Root Causes, and Yes, that might mean taking a good look at their business practices, the improvements they say they will make will not happen anytime soon.
In a a recent article about 1000 workers in a Foxconn factory rioting, workers said the improvements promised are not happening. Whilst the reason for the riot was not labor related, tensions between management and workers remain high.

Here's a report from the Guardian outling recent investigations from SACOM, an NGO in Hong Kong

http://www.guardian.co.uk/technology/2012/may/30/foxconn-abuses-despite-apple-reforms?newsfeed=true

I reiterate that unless Apple, or any other company engaged in Labor Compliance understands the probable impact that their business practices and sourcing decisions have on a factory's ability to meet their compliance objectives, they will fail to deliver on their promises.
Regards
Wally

Apple, meet Nike.

Leonie Barrie of Juststyle has posted this news from Nike.
In it, there is a snippet of information that Apple may need to take notice of if they are to achieve their stated goal of resolving their overtime issues.

I quote, "But the company says in some areas "progress was slower than targeted," including the reduction of excessive overtime within factories. Crucially, 68% of excessive overtime incidents in 128 factories were found to be due to factors that Nike itself could influence".

68%, just in case you missed that.

So Apple, tell me again how you are going to manage this task if you are not taking a long hard look internally and addressing the  impacts of your own purchasing/sourcing practices.

Thank you Nike for bring this to their attention

Mike Daisey's alleged Foxconn fabrications

For those of you who have been following the Apple/Foxconn story, you will be aware of  Mike Daisey's acclaimed one-man show "The Agony and the Ecstasy of Steve Jobs," in which he talks about visiting a factory in China that makes iPhones and other Apple products. This American Life show on NPR has issued a retraction because they can't vouch for its truth. He allegedly made up parts of his story, namely child labor, armed guards, chemical injuries etc.
Here's a link to the NPR retraction and interview with Mike Daisey. In the 3rd section, they interview the reporter from the NYT who describes what they actually found and also some of the statements made by Apple executives. There is a large part of the story that is not getting any airtime, and that has to do with why they, and many other companies, are working so much overtime in the first place.
I wrote to Ira Glass. See below;

Dear Ira,

I’d like to add some info that the NY Times team and Apple have not covered. I didn’t hear anyone discuss the reasons why so much overtime is being worked in the first place. In many cases, the buying practices of these companies are not compatible with corporate codes of conduct. Without getting to the root cause of these long term code violations, it will be impossible to correct or enforce. Faced with the need to meet a customer’s delivery and margin expectations, and also meet code provisions (60 hours), most factories falsify the records. Overtime and minimum wage violations are common, and never really go away. Why? Because in many cases, our corporate culture and business practices are at the root of it. Companies turn a blind eye to this as long as the factory has some improvements and is seen as willing to engage in continuous improvement. The factories know this and “play the game”, without ever addressing the long term issues.

One of the executives at Apple was quoted as saying if Apple wanted to, Apple could enforce codes of conduct and the factory would do it. This is not true. Unless they address their own business practices to make sure they are compatible with their own code of conduct, their factories will continue to be out of compliance.

Here’s a link to an article I wrote back in 2004. http://www.allbusiness.com/manufacturing/apparel-other-finished-products-made/4397949-1.html

As you can see, this is still not being taken seriously, except by a small number of brands, such as Nike, Gap. You can read their efforts to address this in their annual CSR reports.

Apple should know better.

Wally

Hello, is anyone in there?

In all of the statements Apple has made recently about its fair labor program and practices, I have not heard or seen once, any mention of their business practices impacting their factories' ability to meet their code of conduct. Not once. They are either in total denial or not aware of their impact. The impact of business practices, such as short lead times and pushing factories for better margins despite increases in the labor wages and raw materials, is well documented by those that have accepted that they may be part of the problem, such as Nike, Gap, Levis etc. Apple have no chance in gaining full compliance at their factories without understanding the root causes. SACOM  (Students and Scholars Against Corporate Misbehavior) have pointed out to Apple that this is something they should be aware of. They might try and make the case that they were unaware of this. However, now they know, yesterday was ignorance, tomorrow is negligence.

I hope the FLA staff do a better job than their President and bring these issues to the attention of Mr Cook.

Apple in the press and feeling the squeeze

Sorry for the title. I couldn't resist it.
The New York Times put out an article last week about the compliance problems at Apple factories. I also received a request from the Huffington Post to comment on it, which I did. The Internet has been buzzing with indignation by Apple users and tech bloggers, and boycotts of their products have been called for. There wasn't much new in the report, except that they had a few quotes from ex Apple executives saying that business basically trumps compliance. And why, I ask, is this news? It would be a brave executive that would stand up and say " Let's reduce our profit forecast so we can pay factory workers more money".
This is more the reality.
“The only way you make money working for Apple is figuring out how to do things more efficiently or cheaper,” said an executive at one company that helped bring the iPad to market. “And then they’ll come back the next year, and force a 10 percent price cut.”
Here's the article in full

Explosian in Apple component factory

The scrutiny by Chinese NGOs is not abating. If anything, it is getting stronger.
Here's a report from the Washington Post by Hayley Tsukayama,

Chinese officials are investigating an explosion last weekend at another factory in China that makes components for Apple products.

Apple supplier Pegatron Corp. said in a statement that the explosion at the Shanghai factory occurred in dust collection equipment, the Associated Press reported Tuesday. The wire service said local media reported that 61 people were hurt and more than 20 hospitalized but that none had life-threatening injuries.

The explosion rocked the Riteng Computer Accessory Co., a wholly owned subsidiary of Pegatron, in Shanghai’s Songjiang district. The early details of the blast appear to closely mirror a blast at another Apple supplier’s plant earlier this year.

In May, an explosion at a Chengdu plant run by Foxconn killed three workers. The accident was believed to be caused by combustible dust in an air duct. Buildup of aluminum dust had been flagged as a workplace hazard just months earlier by a labor advocacy group called Student and Scholars Against Corporate Misbehavior.

Apple has faced scrutiny from such groups in the past for the labor practices at companies — particularly Chinese companies — that produce components for its popular consumer technology gadgets. In its 2011 Supplier Responsibility 2011 Progress Report, Apple said that it asked for an independent suicide prevention review of the conditions at a Shenzhen plant and was investigating a report that workers at a different company had been exposed to unsafe chemicals.

Apple did not immediately respond to a request for comment on the Shanghai explosion. Company spokeswoman Carolyn Wu told the AP in China: “Our hearts go out to the people who were hurt in Songjiang. We are working closely with Pegatron to understand the cause of this accident.”