There Are Better Ways to Conduct Inspections

 

There are two fairly good ways to actually find problems during inspections. The first is to hold a massive inspection as a total surprise. Considering the close relationship between the Chinese government and companies such as Foxconn, this is probably impossible. The inspectors have to get visas, and they have to enter the country. Once those events happen, all it takes is a phone call to Foxconn to warn that the inspectors are on the way.

The second method is to station a representative on-site permanently. By this, I mean Apple needs to assign a compliance manager to work in place at Foxconn, and make accommodation for the compliance manager as part of the contract for manufacturing. Once in place, the compliance manager needs to have sufficient authority to force changes when violations of the supplier-responsibility agreement are found, and this should also be part of the contract.

The idea of an on-site representative from the company doing the contracting isn't new. The practice is very common in government contracting and in the aerospace industry, and it's not all that unusual in other industries. But to make it work, Apple can't treat this as business as usual.

Perhaps most important, the Apple representative must be someone who is actually a senior Apple employee. That Apple employee should have been part of Apple in Cupertino, Calif., and should be familiar with Apple's employee practices and with the company's manufacturing practices. This is not the time to hire a former Foxconn manager so that you can avoid paying someone to live in China.

Once in place in an office in each of the Foxconn factories, the Apple compliance manager must be given free rein to move about the factory at will. This is the only way to make sure that the contractor is really following the rules. Scheduled visits or visits in which the contractor's managers escort the compliance manager simply don't work. The Apple representative won't be able to talk freely with employees, see conditions themselves, or to observe compliance as it actually is, rather than how the managers want Apple to think it is.

And finally, there needs to be a contractual arrangement that gives the Apple compliance manager the authority to enforce company standards in the workplace. This could include imposing substantial financial penalties on the contractor when violations are found if the contractor doesn't take immediate remedial action, and perhaps even a stop-work order when really egregious problems are discovered.

Unfortunately, the inspections currently being done by Apple are little more than PR to remove some of the heat from Apple. If Tim Cook and Apple really care about the conditions at Foxconn and other contract manufacturers, then they need to take the steps to enforce the rules and stop looking the other way.