By relocating its iPhone case production to India rather than China, Apple faces a drastic change in work organization and lower returns.
According to Financial Timesonly a shell ofiPhone out of two that comes out of the new production shops in India is in good enough condition to continue its journey to the Foxconn assembly plant. Difficult but logical beginnings for Applewhich wants to greatly reduce its dependence on China for the production of its devices.
It will take several years to adapt
This kind of news is less intended to criticize the work organization of any country than to show that Apple is well underway in its process of reducing its dependence on China for the design of its high-end devices.
The Cupertino giant plans to move 25% of global iPhone production to India by 2025 and 50% by 2028, as China loses its attractiveness every year. The Financial Times points out that these performance difficulties encountered in recent months are really due to the recent nature of the installation of the company in the region for its high-end iPhones.
Jue Wang, a consultant at Bain, points out to the Financial Times that the production plant for smartphone shells, located in the south of the country, still has nothing to do with the famous factory in Zhengzhou and its 300,000 workers. Apple is only at the beginning of its installation and must deal with a change in working methods and culture. Internal sources reveal that the company has sent several employees from the United States and China to train workers for the new Indian production line owned by the Tata conglomerate. He figures it will take about three years for everything to start working properly.
A new culture
Accustomed for decades to have its parts manufactured in China, Apple, by settling in India, must deal with very different organizations. As the Financial Times points out, Chinese workers are adept at “whatever it takes” to keep their juicy contracts with Apple. Sources indicate that the Chinese were able to complete a task in a day when it had been estimated to take several weeks. The work culture is quite different in India, as it is in many other countries in the world.
For people interviewed by the British newspaper, India will succeed in meeting the objectives dictated by Apple in order to keep, in turn, these contracts which are so important for the country’s economy. “But these are baby steps. Apple is barely getting a foothold and learning what works and what doesn’t… Give it three years and you’ll see it scale” Vivek Wadhwa, an Indian-American scholar, told the daily. But Apple will also have to adapt to this new culture and make the necessary efforts in the direction of Indian workers.
