Is the “Perfect” Product Perfect?

I was reading a long article in the Sunday NYTimes of January 22 about why the iPhone ended up being manufactured in China. The gist of the article is that China simply has developed a factory system we cannot match. If you are interested in this important topic, go to the article, but that is not what I want to comment on. About the middle of the article, I spotted this quote from ‘a current executive,’ “We don’t have an obligation to solve America’s problems. Our only obligation is making the best product possible.”

It is a bit unfair to take this exactly as it stands because it was obviously taken out of a longer conversation, but it surprised me all the same. The reporter was querying Apple about the role in supporting domestic employment. I would agree with the speaker about the obligation to solve America’s [unemployment] problems, but the next sentence is a stunner. No other obligation than making “the best product possible?”

What is the best possible? For some time Apple was a laggard in its environmental design practices. It took a considerable amount of negative publicity to convince Apple to consider environmental performance as well as technical features. What about concern for the working conditions in the technically wonderful Chinese factories? I am sure there are other concerns that you would add to the singular one mentioned as additional obligations for Apple .

No single firm of Apple’s magnitude (the largest market value of all US companies) can be responsible for the economic ills or well-being of the Nation. One firm is just a node in a highly interconnected system. When the system is out of kilter, no one node can bring it back to an acceptable operational level. This feature applies also to our tendency to blame our financial woes on a single party or even a handful of causal agents.

Companies are obliged, by law, to meet all sorts of standards that pertain to product safety or the well-being of their employees. Given the anti-regulatory climate being expressed in the political talk these days, I hear business (not Apple specifically) wanting to relax the constraints on their operations. The argument is that they should be allowed to operate freely in the so-called free market. The argument might go something like this. Our sole responsibility is to our stockholders. This, in turn, means we should be the most competitive firm in our sector. And this means we have to make the best possible goods.

I don’t say the Apple spokesperson was making this case, but it is easy to move from his or her words to the implications I make above. If Adam Smith were right and the desired outcome of an economy was maximized by allowing the self-interest of all the actors to govern their action, this competitive strategy would benefit all of us. But Smith’s world is not the same as ours. The side effects of his model of the invisible hand are all too visible. The actions of one party are embedded and affect the whole system. “Too big to fail” is evidence of the systemic nature of today’s world.

I haven’t an easy answer to use to start into a conversation with Apple or any other company that makes a similar statement. One of Henry Ford’s great innovations was not the Model T; it was the realization that workers had to be paid enough so that they could afford his cars. I suspect that few if any of the Chinese workers making iPhones or anything else can afford to buy the goods they produce by their labor. The main difference today from the times of Ford is that the supply chain has become a world-wide network. If Ford’s notion still applies, can Apple or any other firm focus solely on the technical content of the product? Ford’s idea may have been motivated by the vision of more cars sold and more money in the corporate till, but, at least, it recognized the need to pay “living wages” based on the place of the goods in the society. Having the best possible product may and should be value #1, but never the only one.