Cutting the human cost of technology

 

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By Nicole Kobie

Posted on 7 Sep 2010 at 11:21

Given the potential branding damage, it’s no surprise companies aren’t eager to share, with most information coming via leaks to the press.

While a Reuters journalist was reportedly roughed up while visiting Foxconn in February, the factory has since invited media inside the complex.

Foxconn has also promised to make its own investigation public, and openly shared the fact that it has installed safety nets, hired psychiatrists, increased pay by more than 70%, and stopped a bizarre practice of paying compensation to the families of suicide victims.

You really need to think of your contract manufacturer as an extension of your own company

Gartner’s Weston thinks the firms working with Foxconn need to help out too. “You really need to think of your contract manufacturer as an extension of your own company... especially one that is as important as Foxconn is,” he said.

It’s rumoured that Apple is looking at giving workers a 1% to 2% sales bonus. “Something like that goes a long way to treating them as members of your family,” Weston said. And it needn’t increase the cost of an iPhone, as wages make up just a few percentage points of the overall production cost.

Time to pay more?

Even if prices do climb, most young Europeans would be willing to pay up to 10% more for an ethically produced product, according to a survey by makeITfair. Weston disagreed, saying if two otherwise identical PCs are on a store shelf, and one is more expensive but has a sustainable sticker on it, shoppers still choose to save a few pounds.

Of course, it depends on the product. If Apple charged £50 more for an iPad, there would still be queues around the block, but tack an extra pound onto a low-cost mouse in a chain computer shop, and customers might snub it. “Apple has the money to do something like this. In lower market areas, it becomes very difficult,” Weston said.

And that’s where consumers come in – maybe it’s time we demanded to pay more for fairly produced electronics? That might mean sourcing from the UK, from local manufacturers such as Mesh Computers. Sales and marketing director Tony Riccardi says keeping operations local brings cost challenges, but argues: “when you move part of your operation overseas, you lose something.”


But even if manufacturing moves home, or overseas factories improve, there are other challenges. While firms have leverage over their manufacturers via contracts, it’s much harder to trace the source of materials – and that’s at the root of another worry in the IT supply chain: ensuring metals haven’t come from conflict zones such as the Congo, and keeping so-called “blood tin” out of the devices we’re longing to buy.