Made in the World

Excellent Op-Ed by Thomas Friedman today on the problem of “outsourcing” and how it applies to the global supply chain:

… C.E.O.’s rarely talk about “outsourcing” these days. Their world is now so integrated that there is no “out” and no “in” anymore. In their businesses, every product and many services now are imagined, designed, marketed and built through global supply chains that seek to access the best quality talent at the lowest cost, wherever it exists. They see more and more of their products today as “Made in the World” not “Made in America.” Therein lies the tension.

That “tension” is emphasized this week in a series of New York Times articles that discuss the labor practices associated with the manufacture and assembly of various Apple products, and the implications this has for the American job market. I won’t attempt to summarize these articles, as they have already spurred numerous discussions throughout the tech community. But what I do feel compelled to address is the reasoning behind leveraging these criticisms directly at Apple, while largely exempting other manufacturers from the discussion.

Granted, Apple is among the most successful producers of consumer electronics in recent memory, a fact confirmed by their record setting earnings report made public this past week, and naturally will be subject to increased scrutiny. But what these articles don’t appear to take into account is the fact that Apple (as well as any corporation of significant size and scope) has become an international company, and is subject to pressures stemming from sources outside of the U.S. And while the “magic” of Apple’s products may change how we define computing in the post-PC era, global politics and labor standards in developing countries do not change as readily.

In addition, the core tenants of the supply chain have changed. This is not the General Motors of the 1950s or the General Electric of the 1980s; factories need to be able to retool entire lines at a moment’s notice, and potentially add thousands of workers overnight to meet demand for a new product. The factories in Shenzhen and Chengdu are specifically built and planned with these scenarios in mind, and their close proximity to raw materials and manufacturers of component parts necessary for assembly make them an easy choice for companies like Apple to accommodate their rapidly growing product lines and customer base.

Now this is not to say that the conditions of these workers should be ignored; the accidents and suicides at the Foxconn factories are tragic, and are the clear results of a workforce pushed beyond its limits during times of peak production. But Apple is aware of these issues, as presented in their Supplier Responsibility Report, and have outlined a clear methodology for dealing with problematic suppliers. What is needed is greater transparency and continuous audits of factories involved in their supply chain; a task that is complicated by the fact that part of Apple’s secret to its success is maintaining secrecy at every stage of its development process, from inception to delivery of the final product. I would challenge Apple’s competitors to lay their cards on the table in an honest examination of their labor practices as they compare to other companies in the consumer electronics industry. Besides helping independent watchdog organizations draw connections between top-level producers and specific suppliers who are repeat labor-rights violators, it would also foster “competition” between companies to deliver the best products using the most responsible supply chain management.

The management of these supply chains also goes hand-in-hand with the role of the U.S. in the consumer electronics industry going forward. What American policy-makers have to realize is that no one country can hold all of the keys to production; globalization has ensured that each stage of the product development process is delegated to the region that can perform that task most effectively and with the least cost. As more manufacturing moves overseas, a great deal of noise has been made over the loss of American jobs in this sector, but this shouldn’t be seen as a disadvantage, but rather an opportunity to focus on aspects of product development and design that Americans are known for. Friedman elaborates:

In a world where the biggest returns go to those who imagine and design a product, there is no higher imagination-enabling society than America. In a world where talent is the most important competitive advantage, there is no country that historically welcomed talented immigrants more than America. In a world in which protection for intellectual property and secure capital markets is highly prized by innovators and investors alike, there is no country safer than America. In a world in which the returns on innovation are staggering, our government funding of bioscience, new technology and clean energy is a great advantage. In a world where logistics will be the source of a huge number of middle-class jobs, we have FedEx and U.P.S.

The opportunities are there, inherent in our nature. We just have to foster an environment through a combination of education, responsible funding, and public policy that will allow it to grow and prosper.

Because We Are All Heroes

Mike Lacher of McSweeney’s spins us a tale of danger and intrigue:

Some in the kingdom thought the cause of the darkness must be the Router. Little was known of the Router, legend told it had been installed behind the recliner long ago by a shadowy organization known as Comcast. Others in the kingdom believed it was brought by a distant cousin many feasts ago. Concluding the trouble must lie deep within the microchips, the people of 276 Fernadale Street did despair and resign themselves to defeat.

But with the dawn of the feast of Christmas did a beacon of hope manifest itself upon the inky horizon. Riding in upon a teal Ford Focus came a great warrior, a suitor of the gentlefolks’ granddaughter. Word had spread through the kingdom that this warrior worked with computers and perhaps even knew the true nature of the Router.

Best paired with this suggested musical accompaniment.

SOPA/PIPA: The War is Far from Over

Here is the swirling, black-briar heart of SOPA/PIPA; a man representing an industry that makes even politicians tremble:

“Those who count on quote ‘Hollywood’ for support need to understand that this industry is watching very carefully who’s going to stand up for them when their job is at stake. Don’t ask me to write a check for you when you think your job is at risk and then don’t pay any attention to me when my job is at stake,” Dodd said on Fox News on Thursday.

While SOPA has been indefinitely tabled and will soon fade into obscurity, this fight is far from over. Chris Dodd’s statement on Fox clearly demonstrates that SOPA isn’t about protecting artists or industry, but rather the MPAA’s bottom line.

Each year the MPAA/RIAA get a little bit closer to passing “legislation” of such broad and vague scope as to threaten many of our civil liberties. Once Dodd is out of the spotlight, (and three years distant from his prior Senate term) he will become once of Hollywood’s fiercest lobbyists, and no amount of Wikipedia or Reddit blackouts are going to prevent him from financing another set of bills. The only solution I see is to either pass comprehensive campaign finance reform to curb the abusive lobbying and bill-buying, or stop buying media altogether.

Apple Prepping for Education Announcement on Thursday

While speculation has so far centered on digital textbooks, sources close to the matter have confirmed to Ars that Apple will announce tools to help create interactive e-books—the “GarageBand for e-books,” so to speak—and expand its current platform to distribute them to iPhone and iPad users.

While a new unified platform distribution for e-book publishing is welcome, I think the real story here (as Ars Technica covers) is Apple’s potential to operate as both distributor and dominant hardware platform for another industry in dire need of innovation. Companies like Inkling have already begun to innovate in this space, but anytime a first-party solution makes an appearance, it tends to not only legitimate that developer, but also put pressure on the old guard (in this case, traditional textbook publishers) to ease or eliminate restrictions.

If Apple brings ePub 3 support along with a simple web-like workflow, they may be able to enter into one market that even Amazon has yet to crack.

Mr. Daisey and the Apple Factory

Given all the recent turmoil at Foxconn as of late, last Sunday’s installment of This American Life should be required listening for every owner of Apple products (or any piece of consumer electronics for that matter). Really puts everything in perspective.

Sparrow

Sparrow’s Dom Leca on the oft-repeated claim that “email is dead”:

How did you apply for your job? How do you negotiate a deal? How do you review your employee[s'] work? What tool are you using when you’re sending message[s] to your loved ones? SMS, Facebook messages, What’s app, Kik are all great new means of communication but mail still has its own territory. Email definitely needs to evolve. Sparrow 1.x is an attempt to marginally change habits.

Great design isn’t always about creating entirely new products; creating better experiences for tools we use everyday can be just as valuable. I’ve been using Sparrow for a little over a month now, and for me, it’s finally bridged the gap between webmail and a native desktop client. This is a great interview that’s worth a read, not only for Sparrow, but also for the critique of Apple’s App Store ecosystem.

Try Not to Lose Your Temper

If you’re looking for the reason why big-box retail is dying, look no further:

Though the company accounts for almost a third of all U.S. consumer electronics purchases, analysts noted, the company remains a ripe target for more nimble competitors.

But the numbers only scratch the surface. To discover the real reasons behind the company’s decline, just take this simple test. Walk into one of the company’s retail locations or shop online. And try, really try, not to lose your temper.

Best Buy in my mind represents all that’s wrong with the retail experience today. It’s not even really all about price (though the 10-15% markup on most items certainly doesn’t help); it’s the fact that every time I step into one of their stores, I’m either accosted by a salesperson barraging me with offers I don’t want or I’m left to fend for myself trying to receive assistance accessing their inventory.

But inventory management is in itself a problem for Best Buy. I recently endured a month-long fiasco that involved an undelivered item, a failed refund, and hours on the phone. But all of my headaches pale in comparison to the customers who failed to get the products they ordered for the holiday season; even after some placed orders more than a month beforehand. Their statement in response I think more than encapsulates their priority of profit-over-people:

The company issued a statement that read: “Due to overwhelming demand of hot product offerings on BestBuy.com during the November and December time period, we have encountered a situation that has affected redemption of some of our customers’ online orders.”

Encountering a situation that has affected redemption of orders, sounds like a denial of responsibility to me.