Management and Social Wellbeing at Foxconn
Social wellbeing has emerged as one of the important topics among organizations. Today, the concept has transitioned from being a mere buzzword into a vital pillar of wellbeing besides financial, physical, and mental wellness. Unlike mental and physical wellbeing, which are self-explanatory, social wellbeing is rather complex. It denotes the degree of one’s sense of belonging, as well as social inclusion and stability. It pertains to individuals’ lifestyles, beliefs, and values. In the workplace context, social wellbeing encompasses relationships with colleagues, managers, and the broader social security. It also includes feeling valued by both the company and colleagues; a sense of belonging and social inclusion; as well as organizational values and corporate responsibility. Social wellbeing can be perceived from two main perspectives, namely, employeeś socialization and relationships, and organization initiatives, including its culture and CSR practices. Thus, social wellbeing matters to the success of organizations as evidenced by the case of Apple’s partner, Foxconn plant in Shenhua Southern China.
Foxconn Factory at Zhengzhou China, which allegedly manufactures about half of the world’s iPhone, has 350,000 employees, giving rise to a small city by the name of the iPhone city (Jacob, 2018). From interviews of residents of the city, Jacob (2018) discovered that the wages were low, and employees worked 6 hours a week. The employees, who worked dozens of hours overtime besides the normal work hours, resided in story dormitories outside the factory gates and saw their significant others only once weekly (Jacob, 2018). Ever since the factory was constructed in 2007, it has received multiple accusations on different accounts, including labor abuses, harsh penalties for workers who make mistakes, and adverse working conditions. Besides, the factory deployed security personnel that was more aggressive than some of the military bases in the country. Such organization policies can have serious consequences on the social wellness of workers, who may elicit negative responses.
The suicide incidences related to the factory brought it to the limelight. In 2010, some of the factory’s workers started taking their own lives because of frustrations associated with poor working conditions, insensitive work policies, and compensations. According to Merchant (2017), the workers threw themselves from the top of the story dormitories in protest of the poor working conditions and low wages. As a result, 12 workers died while two sustained fatal injuries that year alone (Merchant, 2017). From 23 January to May 26, 12 employees jumped from the story-building and died, with only two surviving. Cases of workers attempting suicide through other means, such as wrist cutting, did not get significant press time (Xu & Li, 2013). Merchant (2017) emphasized that suicide notes and survivors’ accounts highlighted several issues, including harsh managers, reneged promises of benefits, intense stress, and long hours of work. The CEO responded by having nets erected to catch workers who jump. He also hired counselors to help workers develop resilience and cope with the status quo, besides having employees pledge not to commit suicide. One of Apple’s officials, Steve Jobs, dismissed the suicide rates as normal in terms of comparability to the national rates. Management of social wellbeing can significantly boost the satisfaction of employees and improve their productivity, which in turn promotes the company’s profitability.
Application of the Social Wellbeing Management to Foxconn Case
Enhancement of social wellbeing is an integral part of many of the modern management models. It forms one of the three parts of the Triple Bottom Line (TBL) and one of the two goals of the social and ecological thought (SET) management models. Research has substantiated that attending to the social wellness of employees can boost their morale and in turn, promote the success of the organization (Chapter 5). Notably, the social wellbeing of employees surpasses the notion of enhancing productivity and profitability. It extends to their welfare inside and outside the organization. Initiative to facilitate the social wellness of the workforce encompasses three fundamental principles: meaningful work, meaningful relationships, and a friendly and fair work environment.
Meaningful Work
The meaning of life is subjective, as the context and values of individuals shape it. Cultures have a different understanding of a meaningful life. This concept can be understood from two different perspectives, namely, the source and the focal point of meaning. Regarding source, meaning can be transcendent or tangible. In the first case, meaning derives from intangible experiences, which represents a sense of connectedness with others and with nature, as well as relationships with others (Chapter 5). Regarding tangible or materialist sources, meaning derives from tangible accomplishments, results, and pleasures. It translates to the more money a person has, the more meaningful his or her life. For those with excellent sources of meaning, more virtue signifies more meaning. Americans are a materialist society, while eastern oriental societies prioritize virtue. Thus, the Foxconn company should consider the source of the meaning of its Chinese personnel.
Similarly, the focal point of meaning can be divided into individualistic and holistic focus. In the first case, meaning comes from efforts to enhance personal identity and interest relative to others. Conversely, holistic focus describes people deriving meaning through serving the interest of the common and ensuring equitable allocation of resources and opportunities. The former corresponds to relative progress as a source of meaning, while sharing and compassion characterize the latter as the source of meaning. However, money has become the hallmark of meaning in modern society, which has obscured the other perpetual intangible understanding of the meaning of life. Even so, Foxconn’s low wages undermined the role of money in shaping today’s construction of meaning. Social-cultural factors in the environment significantly influence a person’s understanding of the meaning of life (Chapter 5). Such factors are family values, perception of ethics and morality, the media depictions of success, company role models and mentors, as well as prevailing culture and values. Therefore, meaningful work incorporates most of the elements of the employee’s meaning of life.
Meaningful work supports the employee’s perception of a meaningful life. For all workers, work is a primary source of their identity, belonging, and purpose (Chapter 5). Income does not accurately represent the degree of meaningfulness of work, as research revealed that American millennials prioritize the nature of jobs over the compensation. Meaningful work influences virtually all the important work outcomes, including the satisfaction of both the employees and customers, absenteeism, tardiness, motivation, commitment, performance, empowerment, engagement, and stress. The three criteria for determining the meaning of work are as follows (Chapter 3). The first involves an experience of congruence between the job and an individual’s sense of purpose. The second signifies a belief that work confers the opportunity and the power to contribute positively to the world. The third criterion involves a feeling of value and sense of belongingness at work. Work that does not satisfy these criteria can have serious psychological and physical implications, including depression, loss of self-esteem, decrease mental wellbeing, poor resilience to burnout, and suicide ideation (Chapter 5). Based on the chapter, depression and anxiety disorders are the main causes of absenteeism, sickness and work incapacity in the most developed economies, such as the United States, the United Kingdom, Germany, Australia, Japan, Italy, Canada and France. Slightly more than a quarter of employees in the US were fully satisfied with their jobs (Chapter 5). This indicates that the percentage is even worse in developing countries, such as China where Foxconn factory is located. So, even a small improvement in the work policy can have a significant effect on the wellness of employees.
FBL Perspective of Meaningful Work
The FBL management model posits the notion that attaining financial success defines the meaning of life for individuals and organizations. In this regard, the meaning is defined in terms of productivity, sales, and financial-wellbeing (Chapter 5). These three outcomes are the fundamentals of the FBL model. The mainstream marketing which costs a lot of money, as 100 top world corporations account for 75% of the total spending on advertising. Thus, the message mass media promotes replicates the values inherent in the FBL management framework, including that happiness is attained by having material things, that entities and individuals should strive to acquire all the wealth they can for themselves and as quickly as they can, and that they should win at all cost (Chapter 5). From the treatment of the employees at Foxconn, it is apparent that the factory management must have applied the principles of the FBL management framework. The firm has strived to maximize profit at the cost of its employees. It has subjugated their human rights to make the most profit possible and have failed to transfer the profits to the employees; thus, disregarding their wellness leading to depression, anxiety, and protest by committing suicide. The company has taken advantage of the desperation of the locals, who come to look for jobs, to treat them inhumanely by paying them low wages and having them work overtime. Thus, the company has ignored the principle of social wellbeing in HR management.
In the US, the home of Apple, 37% of Americans would like to work more than the average 44 hours a week to increase their earnings. Nevertheless, such an approach will only promote meaningfulness for a short-term because overworking often leads to adverse outcomes on a person’s physical and mental health. The values of millennials contradict the tenets of FBL model, with about 88% disagreeing with the perception that money is the best indicator of success. Similarly, just 7% prefer this management model with 50% and 42% preferring the TBL and SET management models, respectively. Certainly, the behaviors of the workers at Foxconn factory reflects the harsh working conditions promoted by an FBL management approach, which designates meaningfulness to the acquisition of wealth at the expense of others.
TBL Perspective of Meaningful Work
The TBL management model promotes meaningful work by striving to promote meaningful work by enhancing organization’s profitability through the design of jobs with task significance, as well as facilitating task autonomy, skill variety and task identity. Not only can the task performed have a significant impact on the lives of others, but also the employees can perceive the way their work fits into a coherent whole (Chapter 5). As a result, employees can derive meaning from their work.
The triple bottom line (TBL) management approach has social wellbeing as one of its pillars. In terms of sources and focal of meaning, TBL can achieve meaning in work by empowering employees to take more control in determining the nature of their work. Regarding shaping work, the model of management emphasizes on job crafting, which involves workers crafting their jobs to achieve meaning based on their skills and experience. Comparatively, the FBL model emphasizes a top-down approach where managers design the jobs that determine members’ experiences of meaningfulness. Based on Chapter 5, job crafting involves transforming the cognitive meaning of work and includes adding choice to tasks as well as the employees’ relations. Moreover, the framework includes facilitating employees enrollment in proven initiatives, such as mindfulness training, to reduce work-related stress and boosting concentration. Foxconn did not care to have employees craft their jobs or provide soft skills such as time management training to cope with work demand.
TBL can also enhance the perception of work as meaningful by facilitating its prosocial holistic dimension. The model promotes a company’s prosocial focus through the mission and vision of the company, which often inclines to advance the social wellbeing of stakeholders, including employees (Chapter 5). The model prioritizes transformational leadership which involves inviting employees to own the noble vision of the company; thus, promoting performance. Also, the TBL approach highlights the team- or group-based interventions enhance meaning. It encompasses active involvement and participation of employees in designing work-related goals and action planning, which has been proven to be more effective than concentrating on individual workers (Chapter 5). Foxconn factory disvalued its employees by not involving the development of work goals and action plan as per the recommendation of this management model.
SET Perspective of Meaningful Work
SET model of management holds the same views as the TBL model except that it goes further to define the rationale for having wellness programs at the workplace. The model espouses a holistic understanding of mindfulness through rethinking the concept of the way and the reason for work; as opposed to instrumentalizing it to serve the financial wellbeing of the organization. SET approaches flaws the above models of management because they denote meaningful work to increasing material and monetary success in a finite setting. SET approach opposes the sensualist and specialist philosophy of the above two management perspectives which lack spirit and heart (Chapter 5). SET also takes into account the concerns of Adam Smith that practices such as the division of labour which maximizes productivity transform workers into stupid and ignorant people.
SET reverses some of the principles of the previous models. Regarding this, it posits that meaning is best achieved through giving rather than taking. Typically, workers find their jobs as more satisfying the more help they get from co-workers. The SET framework of management premises on the truth that people find their jobs more satisfying the more help they give, such as the opportunities to support, mentor, care for, or assist a co-worker (Chapter 5). Similarly, SET prioritizes meeting the needs of others over striving to satisfy customers’ needs.
Furthermore, the SET model is consistent with the values of simplicity movement, which advocates for fewer work hours and choices of wholesome places to work as a source of the meaning of work. It refutes the claim that social-wellbeing derives from having excess stuff in favor of doing a meaningful task and earning adequate compensation. An interest in the quality of life, social equity and sense of community is increasingly overtaking interest in material, rewards, control and prosperity (Chapter 5). This is contrary to the results of a study which revealed that 93% of Americans focus more on working and making money than they do their families and communities (Chapter 5). Contrary to this tendency, SET framework recognizes that management strategies that widen the gap between the rich and the poor are disastrous. Work is more meaningful if it serves the most deprived members of the community by promoting and developing structures that provide opportunities for the marginalized persons to earn a living through work. Citizens in developed countries are increasingly challenging systems they perceive as unjust, even though such systems may be serving their financial self-interest. However, this situation does not apply to Foxconn since the company is found in China, which is not as developed as the US and other western countries as well as Japan.
Lastly, the model takes into account the spirituality and religious component of social wellness. A focus on material dimension counters that on spirituality as does the self-interest nature of individualism to the teachings of many religions. Over 80% of people worldwide hold religious and spiritual worldviews which shape management theory and practice (Chapter 5). The employees at Foxconn certainly had their religious and spiritual worldviews contradicted by the administration at Foxconn factory. Foxconn should have spirituality and religious values of their workforce and support it.
Relationships
Instrumental skills focus on using people as tools to accomplish a goal in the short- or long-term. This approach constitutes an antithesis of relationships. Conversely, non-instrumental skills form the core of relationships. The purpose of such skills is to stimulate and deepen interpersonal links, to share joy, excitement, grief and loss besides fostering love, trust, respect, and acceptance between people, including among co-workers and between leaders and subordinates, as well as with people outside the organization, such as suppliers and customers (Chapter 5). Such an approach to wellness guarantees a win-win outcome for all the people involved from the employees, leaders, shareholders, to consumers and suppliers, as well as distributors. Non-instrumental skills foster social wellness and the meaning of life.
Friendship in the workplace fosters satisfaction in life by stimulating positive emotions. Selfless friendships are characterized by co-workers hanging out together during non-work hours engaging in non-work-related pursuits, social pursuits, such as hiking, exercising in the gym and perhaps dating. Such friendships occur when individuals do others favors without expecting something in return. Such impetus fosters meaningful work and life. On the contrary, work settings that promote instrumental friendships and rivalry are precursors for negative health, conflict of interest and hinder mutual problem solving (Chapter 5). The three models of management promote different perceptions of relationships.
The FBL approach focuses on instrumental relationships that are designed to optimize employee’s productivity and achieve the organization’s financial wellbeing (Chapter 5). Such HR measures disregard non-instrumental relationships, perceiving them to be a waste of company resources. The TBL approach supports non-instrumental connections to some extent. Although it promotes non-instrumental relationships, the greater goal for that approach is to attain financial benefit to the company (Chapter 5). Managers under this framework are trained interpersonal skills to effectively harness social wellness for financial gain on the side of the employer. In contrast, the SET framework perceives the workplace as instances of mutual assistance instead of impersonal and anonymous commodities (Chapter 5). The SET model pursues re-personalization and de-commodification of goods and services and focuses on the process or principles via which they make the world a better place for everybody rather than a select few. From the relationship perspective of social wellness in HR management, Foxconn factory must have deployed the FBL approach of management, which is why most of the workers experienced mental disorders reflective of the work conditions.
Peace and Social Justice
Peace and social justice constitute the third pillar of social wellbeing. It encompasses various issues, including workplace bullying, poor working conditions, and inter organizations rivalry, among others (Chapter 5). Peace can be perceived from two basic viewpoints, namely, the absence of war and conflict, as well as the presence of freedom and harmony. The FBL management approach has facilitated international economic relations that are stable by promoting financial institutions (Chapter 5). In the post-WWII, many of such institutions were established to protect the economic wellbeing of the victors, while facilitating the economic development of war-torn, low-income countries (Chapter 5). However, such institutions did not succeed in improving the economic development of poor countries as did in reducing subsequent inter-state conflicts. According to the chapter, the failure of the model is partly because of its ethnocentric inclination, where foreign managers enter into the host countries to replicate their practices in the foreign country because they believe they are the best and fits anywhere, regardless of the prevailing culture and other factors. Some of the practices may conflict with the customs of the locals, resulting in an internal struggle to balance the norms of the community with that of the organization, leading to burnout, depression and anxiety, culminating in suicides, like was the case at Foxconn.
The TBL model improves on the FBL model by advocating for institutions that prioritize social justice. It recognizes the need to comply with the universal standards through its adoption of the polycentric perspective. In this regard, the TBL approach to management assumes that managers from the host countries offer the best skill and experience for managing the Multinational Corporation in the foreign market (Chapter 5). However, managers with a polycentric perception believe that adapting the best practices used in the foreign country facilitates the optimization of their firm’s profits. The practices may contradict the values of the employees and other stakeholders, leading to an unanticipated crisis. In contrast, the SET framework advocates for workplace environments that proactively promote social justice and peace (Chapter 5). The model posits that market forces and laws are inadequate guides for ethical business conduct despite being a necessary component of commerce. Thus, the model recommends organizations to exceed mere obedience to the laws to create positive externalities (Chapter 5). Nevertheless, most companies cannot follow this recommendation as they prioritize their financial wellness over the social and economic wellbeing of the employees, who they treat as instruments to achieve financial gain.
Without a doubt, social wellbeing is an important component of effective management. It involves employees’ deriving meaning of work as well as life. Different management advocates for management practices that favor or counter wellness of employees. The FBL framework promotes materialistic approach to the management of the workforce, which conflicts with their worldviews leading to work-related stress and psychological conditions. The TBL and SET models advocates for social wellbeing, although the former prioritizes the financial wellbeing of the organizations. The SET models advocate for mutual relationships between the management and employees.
References
Chapter 5: Management and social wellbeing: Meaningful work, relationship & peace.
Jacob, H. (2018, May). Inside ´iPhone City´ the massive Chinese factory where half of the worldś iPhones are produced. Business Insider. Retrieved from https://www.mysanantonio.com/technology/businessinsider/article/Inside-iPhone-City-the-massive-Chinese-factory-12894408.php
Merchant, B. (2017, June). Life and death in Appleś forbidden city. Guardian. Retrieved from https://www.theguardian.com/technology/2017/jun/18/foxconn-life-death-forbidden-city-longhua-suicide-apple-iphone-brian-merchant-one-device-extract
Xu, K., & Li, W. (2013). An Ethical Stakeholder Approach to Crisis Communication: A Case Study of Foxconn’s 2010 Employee Suicide Crisis. Journal of Business Ethics, 117, 371-386.