Running head: PREPARING TO CONDUCT BUSINESS RESEARCH

Preparing to Conduct Business Research on Apple James Atkins, Courtney Welch, Vernella Jones, Gregory Huchla, and Rebecca Shackelford RES/351 October 7, 2013 Steve Grunig

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People around the world have been connected more than ever. As the world turns, people and their different ideas help to change the business market of the world every day. This is called globalization; and it is also advancing telecommunication. Apple Incorporated tends to capitalize on this method by placing low-wage, low-skilled jobs in China. So, because of the lower wages on labor in China and the higher tax rates in the United States of America, how could any company be persuaded to bring jobs back to the U.S. of A? If Apple were able to move production back to the United States it would boost our economy and may even boost sales because of the local support from Americans who want to see more job growth in our country. Using the logistics of the sampling methods and a proper data analysis, the Apple Company develop a research process that would ethically report optimal results as to why it could bring jobs back to America. The Significance, Scope, Magnitude and Feasibility The significance of moving jobs back to America is to create more job opportunities and support the United States economy. It will also help the companys name and reputation because people will become more brand-loyal to a company who is showing they support their local economy, no matter the cost. The research will look into what it will take to move jobs back, what the financial cost will be to Apple, what the increased production costs mean for customers and what kind of timeline would be needed. There is a lot to consider when making a big decision like this so everything will be considered to determine what the economic, environmental, and financial impact will be. We will create the research questions needed to make our business decision, come up with the hypotheses, and make all considerations to see if a move like this is even feasible.

PREPARING TO CONDUCT BUSINESS RESEARCH Research Questions Apples decision to look at bring manufacturing jobs back to the U.S, will have to address some questions before research can be done. Who will this affect? What has changed to bring manufacturing back to the US? Where can Apple find a location that the corporation is willing to invest along with the community/state willingness to give incentives? When is the move desirable? According to Forbes (Jan, 2012), Apple does not have any manufacturing plants outside of US, the suppliers own the manufacturing plants and Apple places orders with the suppliers. Apple is a creative idea corporation, not manufacturing. If this is the case, then the most important question is why should Apple build a manufacturing plant? With these questions in mind, the research question should be: Is there enough support with the American people to

convince the stockholders to invest in bringing manufacturing to the US? What is the bottom line for Apple to get into the manufacturing business? Hypothesis The idea of Apple bringing jobs back to the United States of America does urge the company to provide a hypothesis for a business plan. Based on the working conditions of China, wages and work conditions have been promised to be improved by the government. This means that costs in labor and shipping will rise within Chinese-based facilities. The energy sources are also rising in China, proving more that Apple will bring some jobs back to the States. The downside of this is that the cost of labor in the United States will be too high to maintain the same quantity as a Chinese facility would have. Sure, the Apple Corporation may provide millions of dollars to produce jobs, but it would only be enough to produce a few hundred of

PREPARING TO CONDUCT BUSINESS RESEARCH them. Fewer number of employees means that the production rate decreases from the original rates of the Chinese facilities. Variables to Consider Apples iPhone and iPad are both manufactured by Taiwanese companies. In fact there are 17 factories where Apple products are assembled and packaged, 14 of those factories are located in China. In order for Apple to bring manufacturing jobs back to the U.S. there is one major variable. The infrastructure and labor force required just is not possible. According to a question asked by the New York Times to Apple executives, why cannot Apple products be manufactured in the United States? The short answer is that a factory in China employs 230,000 workers. This is what it takes to keep up Apples operations. It is hard to find a U.S. city that has 230,000 people as a population, let alone to employ on an assembly line for Apple. Another variable is operating costs. The amount workers are paid in these factories is not even close.

There is no way it could even happen in the U.S. with all of the labor laws in America. A typical worker works 6 to 7 days a week; 12-hour shifts and earns less than $17 dollars a day. Even though this is unheard of in the U.S., these jobs are in huge demand in China. So when we take a closer look at the variables involved they are more like huge hurdles. The first is the amount of employees it takes to operate an Apple factory at the production rate the current norm. The second hurdle the huge difference in what an American employee would make and an employee working in China.

PREPARING TO CONDUCT BUSINESS RESEARCH Ethical Considerations

Ethics says a lot about a person and a company. Therefore, Apple realizes that practicing and reinforcing good ethics behavior is an essential part of running a successful company. Therefore, when Apple decides to perform a business research on finding a new location there are several things they must take in consideration to ensure they will not use unethical behavior. The most important thing Apple has to take into consideration of ethics is to abide by all companies rules when making the decision of opening a company at new location. Apple must make sure in searching for a new location they provide the high level managers, middle level managers, and lower level managers all the necessary details of their research findings. These findings could be the location, the condition of the city, and the cost of how much it will take to relocate employees (if they are willing to transfer to a new location). Also, if a survey was given to the participants of the new location to find out what they thought about Apple; Apple would explain to the participants the benefit of completing the survey and obtain a sign consent formed to ensure their rights will be protected. Sampling Sampling is the study by which conclusions are drawn for the whole population from selected elements. Sampling allows the researcher to gather information quickly, provides a lower cost, and offers a better chance in getting accurate results. A sample is based on accuracy, without having any bias, and precision, the closeness of sample representation of the population. The population to be studied can be separated into two groups. The first, and probably the main, group to be sampled is the United States consumers of Apple products. If Apple were to move all, or most, of its manufacturing plants to the U.S., there is going to be a huge hike in the cost of

PREPARING TO CONDUCT BUSINESS RESEARCH

Apple products. The average Apple iPhone costs about six hundred dollars, even with a contract, and an iPad would be close to a thousand. The dilemma with trying to move manufacturing jobs to the United States is that the cost of Apple products is sacrificed. Sure, most consumers would be all for bringing jobs to the U.S., but if told that it would drive up the cost of all Apple products, those same consumers would change their mind. Even if they don't change their mind, consumers would look at the competition for cheaper products. The second group to be sampled is unemployed people in the United States, which are also potential Apple customers. Now, if they are asked about a possible job working for Apple they would jump at the opportunity. Looking at the wages, hours, and living quarters that are actually on site, there is no comparison between the labor laws in the U.S. and jobs in foreign countries. There is just no way to bring the jobs over here. There is no way an American worker would settle for what an overseas worker receives as compensation for employment. The final deal breaker is the sheer size of Apples facilities. The amount of people working in these manufacturing plants is huge and would not be possible in the United States. The sampling method that is most appropriate is a combination of two, Purposive sampling and Convenience sampling. Purposive sampling will be for people's specific experiences and attitudes and the convenience sampling is for obvious reasons - readily available participants. Finally, the sampling frame is a random sampling of U.S. consumers of Apple products, whether they are employed or unemployed. The size sampled is not that important, enough to get quality data or results. Research Design As a result of the many variables to consider, a Qualitative research design will be used to decide if this is a possibility for Apple. A Quantitative or Experimental research design will not be used because, in this case, it is more important to look at numbers and statistics to make a decision.

PREPARING TO CONDUCT BUSINESS RESEARCH

This will be more of a logistical decision than one of opinion. Moving manufacturing back to the U.S. will be mostly based on the financial impact to Apple and the consumer, and less on what people want to see happen, although customer and local support will be needed in order to make this move successful. Because it is going to be based on statistical factors more than anything else, a Qualitative research design seems like the best way to go. With this, using feasibility testing is an excellent way to see if it is even a possibility for Apple to successfully move manufacturing back to the United States of America. Data Collection Instruments The data collection instruments that will be used to collect the data needed will be both surveys and interviews. Surveys will be used to collect the data needed from the first group used in the research, which will be current Apple customers. A survey will be created to ask the customers if they would spend more on Apple products, if they knew the purpose of the increased price is to support their local economy by moving manufacturing jobs back to the U.S. They will also be able to give their input on how they feel about moving manufacturing back. Some people will gladly support the move and continue to buy Apple products, while others may not care and would rather just continue paying the lower prices. The second data collection method will be interviews. Interviews will be conducted with the people in corporate managerial positions with Apple as well as people in manufacturing to determine what it would take financially for Apple to start manufacturing their products in the U.S. The use of the current instruments of interviews and surveys is only needed and there is no need to create a new instrument to collect the data. Data Analysis Approach According to the data analysis, the Bayesian statistics, it has been decided that Apple Inc. will not be moving to the United States. Since it was such a big decision to make the research

PREPARING TO CONDUCT BUSINESS RESEARCH team chose to use the Bayesian statistics instead of the Classical statistics because they needed more information than the Classical statistics could provide. The research team was able to use the Bayesian statistics to make this decision. By using the Bayesian statistics the research team was able to use all information available to them as well as additional information from general experiences and other data that was collected. They also based their decision on the cost; that will be needed to open a new plant/warehouse, to relocate to the United States, and the cost it will take to employ individuals. The cost along would have been more than Apple is willing to pay to move to the United States. For example, if Apple Inc. open a plant/warehouse in the

United States Apple Inc., would have to relocate some of its managers to make sure the store was up and running and to trained individual on their job descriptions. This could be very costly because the managers will have to be well paid because they have to relocate their families; money has to be spent to proper trained individual this could also be very costly and time consuming. It was not determine if the cost of moving would be worth the move and if they would return on their profits therefore, it was decided that Apple Inc. will remain overseas. From the collected data the research team decided that Apple Inc. will continue to grow overseas and be more profitable than it would if it moved to the United States. The results of the Bayesian statistics will be displayed by the use of the hypothesis testing and research process chart. The chart will display the research design in which the research team used to determine if it would benefit Apple Inc. to move its plant/warehouse to the United States. According to the research design, the research team has decided that Apple Inc. moving to the United States will be more costly than Apple Inc. has ever considered therefore, in order for Apple Inc. to save money it would be better to operate from overseas.

PREPARING TO CONDUCT BUSINESS RESEARCH Conclusion In conclusion, there are a lot of factors to consider when making a big change within a

company and appropriate research techniques are needed to ensure a company is making the best and most ethical business decisions. Apple will be taking the necessary steps to research all areas in question before making a final decision on whether or not to bring jobs back to the United States.

PREPARING TO CONDUCT BUSINESS RESEARCH References

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Maynard, M. (2012). Cheap Labor, Taxes, Location: Why Apple Doesnt Build Products in the US. Retrieved from: http://www.forbes.com/sites/michelinemaynard/2012/01/24/cheaplabor-taxes-location-why-apple-doesnt-build-products-in-the-u-s/ Rawson, C. (2012). Why Apples products are designed in California but assembled in China. Retrieved from http://www.tuaw.com/2012/01/22/why-apples-products-are-designed-incalifornia-but-assembled/ Thompson, C. (2013). Apple iPhones, iPads are all made by Taiwanese companies. Retrieved from http://www.cnbc.com/id/100412626