SocialPerformance of Organizations
Appleis an international technology firm based in Cupertino, California inthe United States, founded by the late Steve Jobs in partnership withSteve Wozniak and Ronald Wayne in April 1976. At the time, the maingoal of Apple’s founders was to make and sell personal computers.The company was registered as Apple Computer INC in 1977 and laterrenamed to Apple Inc in 2007. The renaming was to signify that thecompany had shifted from just making computers to making otherconsumer electronics like phones and cameras. This paper seeks toevaluate Apple’s operations and the role of stakeholders in itsbusiness.
Apple’sProducts and Services
Applemajors in the designing, manufacturing and marketing of mobiletelecommunication devices and media devices, personal computers, andportable music players (Edson, 2012). Some of the devices made by thecompany include the iPhone, iPad, iPod, Mac personal computers andApple TV. On top of making the devices, Apple also makes the relatedsoftware and applications for each device it makes. Apple’ssoftware includes iOS, used in its phones and small devices, OS X,which is the company’s operating system and other user applicationsfor its line of devices.
Apartfrom making devices and the software and applications they use, Applealso offers several services to people who use its devices and otherpeople too (King, 2014). These services include iTunes, anapplication that allows people to upload, sell, buy and downloadmusic. The company also offers iCloud, which is an online datastorage service where the company’s customers can store theirmusic, pictures, contacts, and documents. The Mac App Store givesApple device users to explore, download and install applications fortheir devices.
ExternalFactors Affecting Apple’s Success
Justlike any other business, Apple’s operations are affected by itsinternal environment and external factors (Weiss, 2009). Externalfactors in a business context refer to all the factors that falloutside the business but still affect the operations of the company.In most cases, they are beyond the control of the business but the ithas to devise ways and means of adjusting accordingly to avoid makinglosses or wrong business decisions. Based on how a business handlesthem, external factors can be a boost or drawback. Two externalfactors that affect Apple’s success are technological and legalfactors.
Apple’sbusiness is all about technology. Edson (2012) insists that thedevices, software and services it offers are all based ontechnological innovations. However, technology has a very shortlifespan. What is the in thing today may be obsolete tomorrow. Forexample, Apple’s iPod completely phased out the walkman. Otherplayers in this field, for instance, Google with their successfulAndroid platform give Apple stiff competition. To put up with therivalry, Apple constantly adds new products and innovations to itsline. The company has greatly invested in the research anddevelopment of products, giving it an edge as far as technology as anexternal factor is concerned.
Nowand then, companies in the business technology face legal battlesmostly from rivals claiming infringement of copyrights or patents(King, 2014). Apple is not immune from this occurrence. Apple Inc hasparticipated in several legal battles since its creation. Forinstance, in 2009 the company was sued by Nokia Corporation. Nokiaclaimed that Apple had infringed its patents on a certain type ofwireless technology. This case aside, Apple has also been involved inlawsuits against others companies including HTC and Samsung. Legalbattles cost money to win and cost even more money if one loses sincethey have to pay the imposed fines. They also affect the company’sreputation.
Rolesof Primary Stakeholders in Apple’s Financial Performance
Primarystakeholders have a direct interest in the operations of a company(Weiss, 2009). They directly benefit from or affected by the state ofthe business. They are the company’s employees and owners. Eachstakeholder has a responsibility to handle in influencing thecompany’s financial performance as follows:
Appleemployees need to put their best foot forward in their duties in thecompany. If the employees do this, achieving Apple’s goals becomeseasier since a motivated a self-driven workforce makes it possiblekeep the company running at its full potential. The actions of theemployees directly determine the success of the business. As aresult, Apple’s employees have a key role to play in shaping thecompany’s financial performance.
Apple’sdirectors and other management staff have a duty to keep their staffmotivated, inspired and working at full potential to improve thecompany’s financial performance. They also have to prevent wastageof money and other resources by good supervision. The task ofensuring that the company is running at its optimum falls on themanagers.
Appleowners have a key role to play in influencing the company’sfinancial performance. They have to allow other people in the companyfor example the employees to do their duties without feelingintimidated or despised. They should not rub it on people’s facesthat they own the company since it is rude, and it demoralizesemployees.
Apartfrom the delegation of duties and supervision of tasks, Apple’smanagers have a duty to engage the company employees, owners andother stakeholders in issues affecting the company. They should giveall stakeholders a platform to raise their concerns and problems.This creates harmony and a united front in facing challenges that maybe affecting the company’s performance.
Lastly,the managers, employees and owners of Apple need to be goodambassadors or the company. In all aspects of their career life, theyshould always safeguard and uphold the company’s image andreputation. Creating a good reputation for the company attractspeople to the brand, and these people are potential customers for thecompany. A good image and reputaion helps companies get new customersas well as retain the ones it already has.
Apple’sControversial Corporate Social Responsibility Concern
Appleis on several occasions seen to employ a controversial socialcorporate responsibility strategy. A few years ago, Apple wasembroiled in a tax scandal that saw its CEO Timothy Cook answerquestions concerning the same before a Senate committee in 2013. Thereport released by the committee alleged that has been deliberatelyreducing its U.S. corporate income tax by roughly $10 billionannually for the past four years (Nigrini, 2012). Apple did thisusing a trick that many international companies use. Such companiesplan their business operations in a way that ensures the majority ofthe income is located in countries with low tax rates. Concurrently,they shift many costs to countries with valuable deductions.
Deferralin the US allows American companies operating in foreign countries toelude paying taxes until they bring their income back to the US. Theloophole here is that companies can choose to keep their incomeoffshore, therefore not pay US taxes at all. In this light, Apple settwo entities in Ireland where it channeled two-thirds of its globalpre-tax profit. For example in 2011, Apple made $34 billion pre-taxprofit, out which $22 billion was supposedly made in Ireland, acountry with lower purchasing power compared to the US. What worsenedthe situation is that these firms, even though located in Ireland,they were not registered as Irish companies, so they never paid taxesto the Irish government (King 2014). The majority of Apple’s taxeswere not taxed in Ireland or the US, creating a huge revenue loss forthe US. In this way, Apple is seen to avoid carrying out itscorporate responsibility. The company appears to take advantage oflow production costs in other countries and then taking all theearnings to the US without helping the local communities in thosecountries.
AppleInc is a multinational technology company that specializes in thedesigning, manufacture and selling of media devices, portable mobiledevices and personal computers. A key player in this field, severalexternal factors affect Apple’s business these includetechnological changes and legal factors. Apple’s primarystakeholders play different vital roles to enhance the company’sfinancial performance. However, Apple appears to be lagging behindregarding corporate social responsibility, exemplified by the taxevasion scandal highlighted in the essay. Such shortcomings shouldbe addressed to keep the company ahead of its competitors.
Edson,J. (2012). Designlike Apple: Seven principles for creating insanely great products,services, and experiences.Hoboken, N.J: Wiley.
King,S. (2014). Applemarketing audit and new service product plan.Munich: GRIN Verlag GmbH.
Nigrini,M. J. (2012). Benford`slaw: Applications for forensic accounting, auditing, and frauddetection.Hoboken, New Jersey: Wiley.
Weiss,J. W. (2009). Businessethics: A stakeholders and issues management approach.Australia: South-Western Cengage Learning.