Case Study

Foxconn and blood iPhones?

12 pages
July 2011
Reference: IMD-3-2193

For Terry Gou, 2010 should have been a good year. He topped the Forbes billionaire list as the richest man in Taiwan and his company Foxconn was listed as 112th in Fortune’s ‘Global 500’ rankings and appeared again on the ‘Most Admired Companies’ list for 2010. Life suddenly changed for Gou with a spate of suicides at his South China factory in Shenzhen where iPhones are made. Foxconn’s lack of response until the 11th suicide could potentially damage the company’s reputation. Over many years Foxconn had built up an enviable customer list of global brand names such as Apple. It also expanded into different areas within and beyond consumer electronics becoming a global player and significantly larger than its closest competitors. This case explores the actions Foxconn took as a result of the suicides and the challenges facing Foxconn into the future.

Learning Objective

The Foxconn case deals with ethical and reputational challenges related to the multinational companies and outsourcing companies in developing countries. The case aims to facilitate debate over dilemma situations: conflicting stakeholder power/interests; short term vs long term profitability; economic interest vs wellbeing; blaming vs supporting the supplier’s misconduct; and reputation of the subcontractor vs the MNCs. In particular, international audiences will benefit from discussing differences in values and moral standards between the East and the West.

Keywords
Reputation, Ethics, International Business, Communication, Culture, Brand, Global, Well-being, iPhone, Consumer Electronics
Settings
Global, China
Foxconn
2011
Type
Published Sources
Copyright
© 2011
Available Languages
English
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