Foxconn

Abstract Human kind has always strived for advancement in knowledge and technology. Whether it was the invention of the wheel or creation of Nano-technology, we have all grown accustom to electronic gadgets and what they do to aid our everyday existence. There is an unlimited demand for electronic devices worldwide, and Foxconn has taken the helm at providing those products. They do business with some of the leading companies internationally such as Microsoft Corp., Cisco Systems Inc., Sony, Hewlett-Packard Co., Nokia and of course Apple Inc. Foxconn serves a worldwide network of distributors and original equipment manufacturer customers in the U.S., Latin America, Europe, and Asia. Foxconn’s innovative and forward thinking has indeed launched them full bore into the international export history books.

Foxconn Foxconn is one of the world leaders in manufacturing, assembling and design of electronics.
Foxconn is the registered trade name of the Hon Hai Precision Industry Co., Ltd. a global leader in providing mechanical and electromechanical solutions to the communications, consumer, and computer industries. Founded in 1974, and listed on the Taiwan stock exchange in 1991, Foxconn is the largest exporter from mainland China; their market capitalization exceeds $12 billion USD (Foxconn Expands, 2005).
Their sales revenues for 2010 exceeded $137 billion USD. Foxconn employs upwards of 1 million employees and is the worldwide leader in manufacturing graphics cards, motherboards, optical storage devices, servers, workstations, information assurance products and bare-bone systems. They manufacture products for companies including: Acer Inc., Amazon.com, Apple Inc., Cisco, Dell, Gateway, Hewlett-Packard, Intel, Microsoft, Motorola Mobility, Nintendo, Nokia, Samsung, Sony, Toshiba, and Vizio. With well over thirty years of manufacturing know-how that is also comprised of global distribution and logistics, Foxconn is devoted to easy and affordable business for its consumers, offering ground-breaking, award-winning merchandise that thrust the market onward. Foxconn serves a worldwide network of distributors and original equipment manufacturer customers in the U.S., Latin America, Europe, and Asia.
Political and economic systems of China The sole party in power in China is the Communist Party. Founded in 1921, the Communist Party of China established the People’s Republic of China in 1949 through years of armed struggle (The Party in Power, 2012). There are now, more than 60 million Communist Party of China members comprised of well over 3 million working-class organizations. There are formal and informal organizations established throughout the government from all levels and walks of life. The System of People's Congress is one such organization that is comprised of the National People’s Congress, Standing Committee of the National People’s Congress, Local people’s congresses and their standing committees, People’s congresses of townships, Ethnic townships and towns, and The Deputies to the people’s congresses (The System, 2012).
Economy of the People's Republic of China As the second largest economy, behind the United States, and by-far the largest exporter of goods in the world, China is the world’s fastest growing economy with a 10 percent averaged growth rate over the last 30 years. The country's per capita GDP (PPP) was $8,394 (International Monetary Fund, 90th in the world) in 2011. The provinces in the coastal regions of China tend to be more industrialized, while regions in the hinterland are less developed (Economy of the People, 2012). China has placed great emphases to the structure and well-being of their economy as the importance of their economic growth rises.
Cultural aspects of doing business in China The Foxconn Longhua factory is the biggest in the world and is responsible for over 20 percent of the annual exports emerging from Shenzhen, the one-time fishing village that has become one of the capitals of the world's manufacturing industry. There are many hidden obstacles to doing business in China such as tradition, social structure, and thought patterns that require extensive, time-consuming experience and research to overcome any of these obstacles. Chinese behavior is very complex; their judgments are guided by five coexisting realities. Their every behavior is infused by a set of social rules that date back to 500 BC and is considered a Confucian society. China has a unique brand of socialism called Stalinist-Leninist-Moaist Society which is a completely alien form of philosophy to Confucianism. Chinese foreign policy is driven by “realpolitik” (politics or diplomacy built principally on power and quantifiable factors and thoughts). This is an area where the Chinese are dominant and do not yield kindly to foreigners directing them how to behave within their circle of influence. To them, human rights of their citizens, the plight of Tibetans, and the use of prison labor, are, simply, none of our business (cultural insights, 2010). The Chinese have made feeding over a billion people their first priority and then focus on the standard of living; it’s all about surviving and growing. When referring to China, you might think that Chinese is the only language of the land; this is not true, there are more than 15 languages and cultural groups. When visiting or planning to work in China, one should pay special attention to the area visited because of the language differences.
Foreign Direct Investment policies in China China has been a very energetic contributor in regional economic co-operation and integration in the last few years. Their idea is to share the achievements they have made with other Asian countries.
Foreign direct investment has achieved great success since its entry into China. In recent years, although the global inflows of foreign direct investment declined, China experienced an increase to USD $53,505 million in 2003, which pushed China to become the world’s largest FDI recipient in 2003 (UNCTAD, 2004), overtaking the traditional largest recipient of the world—the United States. The observed increase not only results from China’s strong domestic economic growth but also from improvements in its investment environment under domestic economic reform and the implementation of regional economic integration (Empirical Study, 2006). China has proven its resilient readiness and commitment to regional integration by launching a free trade area with Association of Southeast Asian Nations countries and suggested Japan and Korea have these free trade areas also. Foreign direct investment plays a vital part in the economic growth of China and they should devote as much time as possible to regional economic integration.
Effects of Regional Economic Integration in China China’s swift and substantial upsurge as an economic influence has a massive effect on the global and regional economy. In referring to regional integration, China is taking the primary role in two facets. Their import volume has shaped the new foundation for Asian provincial development: internal demand. With countless Asian economies’ exports to China increasing by double-digit percentages in the past few years, China has confirmed its place as the foremost market for Asian merchants. China swapped places with Japan in 2003, as the world’s third largest importer for products trade and the largest Asian and EU exporters in the Asian market. As a result, Asian countries are a little less reliant on North American and European markets, and more so reliant on the Chinese market, even though the increased Chinese plea for more raw materials has been looked upon as a significant influence in reversing the long term descending movement in prices of non-oil commodities. And finally, China’s escalation on Asian economic integration is that China acts as a leading role in influencing the new division of labor in Asia, essentially as an effect of the trade-FDI connection, which has had a profound impact on China.
China’s strategy for influencing or intervening in trade and trade control Recently, China has been at work trying to further develop its export control system in an effort to address mutual threats and become a more accountable international performer, nevertheless they continue to run into countless challenges.
Overall, there has been relatively little government-to-government engagement or cooperation between the United States and China on export controls, due largely to political and statutory restrictions. Those restrictions stem from legislation passed in the early 1990s in response to Tiananmen Square that limited the types and amount of assistance the U.S. government could provide to China. Meanwhile, U.S. non-governmental entities have been working with Chinese partners to establish U.S.-China cooperation in this area (China’s strategic, 2007). Some noteworthy improvements have come about in China’s export control system thanks to these efforts. Recently, there has been an effort to bolster government-to-government collaborations on export control by the U.S. department of Commerce and the Chinese Ministry of Commerce.
The University of Georgia Center has developed the China-U.S. Working Group on Trade and Security in coordination with CACDA and support from the MacArthur Foundation. The Working Group is an effort that draws upon Chinese and American experts and specialists to address key national and international nonproliferation and export control issues currently facing the two countries. The goals of the Working Group are to increase awareness and understanding of these issues, to exchange ideas and experiences on some of the more technical aspects of strategic trade control, and to offer viable solutions to the challenges involved in promoting U.S.-China relations regarding high-technology trade (China’s strategic, 2007). Any company that has an accountable, internal export control compliance system is likely to be more successful in many more markets and avoid U.S. sanctions, than other companies who are inclined to be less responsible.
China’s international expansion strategy Foxconn currently has factories in Asia, Europe and Latin America, which together assemble around 40 percent of consumer electronics products in the world (Foxconn, 2012). Foxconn has operations in Brazil, Europe, India, Malaysia, Mexico, and China, which has 13 factories in nine Chinese cities, more than in any of the other countries. They continue to increase production capabilities by opening factory sites at Chengdu in Sichuan province, Wuhan in Hubei province, and Zhengzhou in Henan province. Foxconn plans to open five more facilities in Brazil, it is believed that current factory production will not be able to keep up with demand of the immensely popular Apple IPhones and IPads. The addition of the new factories should help them keep up with demand for Apple products. Apple isn’t the only company utilizing Foxconn factories, the facilities are planned to be tooled to build notebooks as well as general electronics construction for many other companies.

Foxconn’s international marketing philosophy
Although Foxconn’s international marketing philosophy could not be found, they have establish a philosophy by way of their actions in that they have taken control of a large portion of the electronics industry and export of those goods all around the world. They do business with companies such as International Business Machines Corp., Microsoft Corp., Cisco Systems Inc., Sony, Hewlett-Packard Co., Nokia Oyj. and Apple Inc. Foxconn’s plan to open more factories around the world is proof of such a plan.
Discussion
To gain a greater understanding of just how diversified Foxconn’s supply chain really is, take a closer look at the Iphone, Ipad, mother boards you use in your computer and servers, up to 70 percent of these products are made by Foxconn or one of their affiliated companies. Their overreaching power to achieve such a high rate of production growth and success, in not only China, but also around the world, is attributed to a set standard of 30 percent annual growth rate. Foxconn has plans to exploit on possibly the most exciting of its plans to transfer additional production to the United States at their Houston, Texas plant. The Houston plant currently makes high-end servers for exclusive commercial clients. They envision a fully automated manufacturing plant to produce electronic parts within the near future with the idea to produce in the U.S. and ship to China and still keep it cost competitive. Foxconn is by-far the largest exporter of goods in the world and has helped China to become the world’s fastest growing economy. China’s formal and informal organizations of their Communist Party, has definitely not hindered them from becoming a leader in electronic product manufacturing. They continue to improve their export control system and have place great effort to bolster government-to-government collaborations. Foxconn has steadily pushed to find resourceful ways to intertwine a culture of sustainability and corporate dexterity. Their ability to manufacture the products of the world and the future, will surely label them as one of the most innovative product manufacturing companies in the world for years to come.

References
China’s Strategic Trade Controls and U.S.-China Cooperation on Nonproliferation (2007). Retrieved from http://www.uscc.gov/hearings/2007hearings/transcripts/july_12_13/ bertsch.pdf
Cultural Insights on Doing Business in China (2010). Retrieved from http://gbr.pepperdine. edu/2010/08/cultural-insights-on-doing-business-in-china/
Economy of the People's Republic of China (2012). Retrieved from http://en.wikipedia.org/wiki/ Economy_of_the_People's_Republic_of_China
Empirical study on the impact of regional trade agreements on strengthening China’s FDI (2006). Retrieved from http://www.cfses.com/06confchina/documents/Final_Papers/ Paper_LiuTianshu_Impact_Regional_Trade_Agreements.pdf
Foxconn (2012) Retrieved from http://en.wikipedia.org/wiki/Foxconn
Foxconn Expands Distribution by Adding ASBIS (2005). Retrieved from http://www.industrial newsupdate.com/news/manufacturing/archives/2005/03/foxconn_expands.php
The Party in Power (2012). Retrieved from http://www.china.org.cn/english/Political/26151.htm
The System of People's Congress (2012). Retrieved from http://www.china.org.cn/english/ Political/26144.htm