Fire-fighting HRM

in China’s new global Economy

C A S E S T U DY
Presented For Dr. Sara Yassin

AASTMT - MBA - Smart Village 2H /Group No. 3 Presented By:

Sunday 19-06-2022
Ahmed Abdel-Moneam Hassan Reg. No. 21121571
Ahmed Lotfy Abdel-Latif Reg. No. 21121681
Ahmed Sayed Abdel-Hamid Reg. No. 21121453
Mohamed Abdel-Hamid Othman Reg. No. 21126140
Mostafa Salah El-Din Hassan Reg. No. 21121634
About Electronics Manufacturing Services (EMS)

7500 $
1974
Established in Taiwan 10 Workers

1988 Foxconn City In China

1995 Started With

1996 ($500 million) Annual revenues

Mr. Terry Gou
the Founder and ceo of Foxconn
2004 Became the largest Manufacturer for Laptop
About Electronics Manufacturing Services (EMS)

2004
Started With

2005 Became the largest Manufacturer for cell phone

2009 Started Manufacturer LCD for Sony, Sharp

2010 Annual revenue reached ($100 billion) Mr. Terry Gou

the Founder and ceo of Foxconn

2019 Annual revenue reached ($ 172 billion)

 Products
1- Consumer electronics

2- Cloud and Networking Products :

3- Computing Products :

4- Components and Others:

Brands
 Shenzhen plant
Foxconn Head Count Reached to (1,500,000) workers
Working 24-7 continuous production and live at the same location
Many employees end up working long 12-hour shifts, often with overtime going unpaid.

There are 7 dormitory buildings on the Foxconn, 6 stores and 30 rooms on each floor
10 workers share a room. The gates close at 23:30, and lights are switched off at 00:00.

The turnover rate is about 35% per year, according to Wang Tongxin,
vice chairperson of the Shenzhen Federation of Trade Unions

The normal rate 5% at manufacturing. This is indicated job satisfaction and high work pressure.
 Shenzhen plant
 Suicides:
In 2010, the company was plagued by a wave of employee suicides.
 Wage and hours exploitation
In 2012, Foxconn was accused of underpaying wages and having its
employees work excessive hours.
 Serious accidents:
One Foxconn worker was brain-damaged after an electric shock in
2011. An explosion in one factory killed four people and injured
another 18 in the same year.
 Underage and illegal workers:
Foxconn admitted to having hired teenagers as young as 14 at one
of its factories in 2012.
 Few Years Ago:
Apple confirmed that, at a plant where its iPhone X is made,
student workers were discovered to be working overtime in
violation of local laws.
 Poor living standards
The New York Times reported in 2012 that as many as 20 workers
could be housed in three-room staff apartments.
1- How do you feel
after reading the short Foxconn case study?
 HRM Issues in Shenzhen plant

Minute

Material Money

Man
Machine
power

Market
2- Which, if any, of the four competing perspectives to
HRM in Table 1.2 do you think capture the way people
are managed at Foxconn?
 HRM Issues in Shenzhen plant
• Unbalance in WLB- Work Life Balance

• Low Reward System & Low in Benefits for Employees

• Work Overload With Mono Task Oriented Duty

• Toxic Work Environment Without Compensating in some Way

• Missing Competencies & No Succession Planning to Be Implemented

• Illegal Labor Contracting (Under Legal Age)

• Gap In Communication Between Foxconn Grades

• Missing Innovative Talents With Highly Turnover Ratio

• Planning Crisis So, Randomize Performance

• Gap in Performance Monitoring & Evaluation

 Alternative approaches to the study
and practice of HRM
Beliefs and
Approach Strategic Qualities Role Line Mangers Key Drivers
Assumptions

Matching Models (Hard) Compliance Calculative efficiency Rule-bound Product demand

People-supportive
Matching Models (Soft) Nurturing commitment Coaching Training and development
policies

Bundles of
Organizational Performance Strategic and Internal and external fit
complementary HR
Performance enhancing measured KPIs (integration)
policies

Global business model

Radical (Critical) Exploitation of people Authority agents of Peer surveillance/ Control
(capitalist) sources of
Management at work owners of labor process
power

Integration of individual
Employee-Centric Critical of cause and- Balance of opposing Significant and
and collective orientated
Approach effect assumptions interests active agents
processes
3- What does the Foxconn case tell us about flexibility,
outsourcing and work fragmentation issues
discussed in Chapter 1?
 Flexibilization explains changes to the ‘way’ people work, with
attendant implications for HRM. So employees are now more
likely to be female, and also work part time and away from the
workplace
1. functional flexibility (the way workers are managed using
multi-skilling and technology, etc.)
2. numerical flexibility (how employees are employed using
casual or temporary contracts)
3. spatial flexibility – where they work.
• Foxconn didn’t have enough flexible system as the following:
1. functional flexibility – there are many reports about harsh
working conditions and the way staff members are managed.
2. numerical flexibility – It is evident that young workers from
rural provinces of China.
3. Spatial flexibility - over 500,000 people live and work at the
Foxconn site, many of whom are rural migrant workers who
flock to these expansive industrial cities for employment.
 Outsourcing is the business practice of hiring a party
outside a company to perform services or create goods
that were traditionally performed in-house by the
company's own employees and staff.

• Foxconn as a single corporation it dominates the world

market for outsourced electronics, with about 50 percent
of total market share and a client list including some of the
most well-known household brands: Apple, IMB, Sony,
Motorola, Nokia and many others who all utilize a global
supply chain network of manufacturing firms assembling
production in many developing regions of the world.
 Work fragmentation define as a break in continuous work
activity. Studies continually describe how the work of information
workers is characterized by spending short amounts of time in
tasks and switching frequently.
• We consider that work fragmentation has two main aspects:
1. the length of time people spend in a continuous activity.
2. interruptions of that activity.
• In general, we consider that work is more fragmented the shorter
amount of time one spends on a task, and the more interruptions
one has.
• Foxconn didn’t apply work fragmentation as Many employees end
up working long 12-hour shifts, often with overtime going unpaid.
Supervision has been reported as intensive and
• intimidating with workers having to take time off during low peak
periods as a way to circumvent overtime regulations and protective
labor laws
4- What responsibilities and influence does or should
the likes of Apple have over Foxconn’s human resource
strategy?
 Examples of Problems
• Explosions ,Aluminum dust & toxic cooling fluids within CNC
Machining, polishing department
• Cutting glass to produce screen , Screens adhesive chemicals
• Due to high production demand and lack of facility development and
safety precautions.
• Bleak working conditions have been documented at factories
manufacturing products for Dell, I.B.M., Lenovo, Motorola, Nokia,
Sony, Toshiba and others
• “Apple never cared about anything other than increasing product
quality and decreasing production cost,” said Li Mingqi, management
at Foxconn Technology, 2012
Examples of Problems
 Steps Forward:

• Spread Awareness within customers about overseas

labor violations.
• Regulations Authorities shall standardize health and
human safety regulations within suppliers agreement
and product certification like CE mark.
 Influence and responsibility should the likes of Apple
have over Foxconn’s human resource strategy

• Commit and publish supplier code of conduct regarding human safety.

• Labor and human rights provisions in suppliers agreement shall hold suppliers
accountable at every step
• Suppliers Code of Conduct shall sets strict labor and human rights requirements,
• Upholding labor and human rights. Invest on training people on workplace rights.
• Supplier employees’ surveys about their workplace experience
• Reviews of supplier safety practices
• Expanding their suppliers option. Developing supply chains with proper labor
safety agreement before start partnership.
5- Is democratic unionization on the factory floor a
possibility of change?
• Industrial democracy is an arrangement which involves
workers making decisions, sharing responsibility and
authority in the workplace. While in participative
management organizational designs workers are listened
to and take part in the decision-making process.
• A labor union is an organization formed by workers in a
particular trade, industry, or company for the purpose of
improving pay, benefits, working conditions and
protecting employees rights from abusive managers
Officially known as a “labor organization,” and also called
a “trade union” or a “workers union,” a labor union
selects representatives to negotiate with employers in a
process known as collective bargaining. When
successful, the bargaining results in an agreement that
stipulates working conditions for a period of time.
 Not surprisingly, then, business managers resist unions
because they generally add to the cost of doing business.
 Management doesn’t typically sit by passively, especially if
the company has a position to defend or a message to get out.
One available tactic is the lockout - closing the workplace to
workers -though it’s rarely used because it’s legal only when
unionized workers pose a credible threat to the employer’s
financial viability. If you are a fan of professional basketball,
you may remember the NBA lockout in 2011 (older fans may
remember a similar scenario that took place in 1999) which
took place because of a dispute regarding the division of
revenues and the structure of the salary cap.
 Eventually, It may have an impact when implemented on the
factory floor, but without management commitment and
willing to change, the change will not take place smoothly
and as planned.
References
• https://www.osha.gov/aboutosha

• https://ehssafetynewsamerica.com

• https://tvtropes.org

• https://www.nytimes.com

• https://www.apple.com

• https://www.responsiblebusiness.org

• https://europa.eu/youreurope/business/product-requirements/

• https://www.foxconn.com

• Contemporary human resource management: text and cases [5. edition]

• Behavior in Organization – Jerald Greenberg, Robert A. Baron – www.prenhall.com/greenberg

• Strategic Management and Business Policy – Tomas L. Wheelen , J. David Hunger

• Understanding Business – Nickels . McHUGH . McHUGH