Critical Discussion On Nike Management Report
Write a well-researched Nike management report in not more than 3000 words.
This assignment selected the NIKE Company as a case study. Nike is an American multinational company. This company engaged in the manufacturing, design, development, sales, and worldwide marketing of the different footwear, equipment, apparel, accessories, and relevant services. The headquarters of the company is located in the Portland metropolitan area. The mission of the Nike Company is “to bring innovation and inspiration in the mind of every athlete in the entire world” (nikeinc-mission. 2020). The main mission of the company is “to bring innovation in their products to expand the potential of the human. The company wants to make the diverse and creative team that make a positive impact on the society and community”.
This section conducted the SWOT analysis of the NIKE Company to identify its Strengths, Weaknesses, Opportunities, and Threats.
· Spirit of bringing fast innovation in their products to inspire human potential.
· The diverse, empowered, and inclusive global team
· The Strong brand image and their movement of protecting the future spirit of the sports in every athlete.
· Extensive production across the world and their huge distribution network (Nike sustainability. 2020).
· The minimum wage issues, child labour issues, employees’ work for long hours in the low wages and hazardous working conditions that may create health issues of the workers, etc.
· Nike’s huge carbon emission issue and waste disposal issue in their supply chain production system.
· Trash transformed mechanism for reducing the waste disposal issue to produce innovative products.
· Use of Sustainable cotton and recycled plastic bottles and polyester to transform them into their products.
· Efficient integration of recycled polyester and cotton to make more sustainable products.
· Counterfeit of Nike’s products by their substitutes.
· The huge competition in the global market and potential competitors like Puma, Asics, Adidas, Reebok, Anta, Fila, etc.
· Fluctuating rate of the foreign exchange.
In this section, the assignment discussed one of the ethical approaches in the business that should be maintained by the organization to smoothly operate their business. The moral rights approach of the Ethics defines the companies should protect and respect the fundamental human rights, moral rights of the employees and other stakeholders and maintain the equal treatment under the human moral rights law (Wong, 2020).
The Nike Company can use this approach of ethics in their ethical decision-making process. The company can fulfil their commitments by maintaining the equality among both female and male employees, respect for women, empowering the employees by giving the proper healthy workplace, reducing the sweatshop issue, and giving the proper rights to raise the voice against the discrimination. These commitments would help the Nike Company to maintain its ethical rules and regulation.
CSR approach covers the five main areas of the business such as community, environment, employee welfare, corporate governance of the company, and financial performance of the company. The creating Shared value approach of the CSR defines that the company needs to develop its future market by strengthening its economies the communities, and the marketplace of the company (Høvring, 2017). This approach encourages organizations to invest in social welfare, environment conservation, and creating opportunities for healthcare and education for the entire growth of the business.
The NIKE Company can maintain this creating Shared value approach of the CSR by maintaining all responsibilities towards its community, society, environment, and stakeholders. The company can increase the process of reducing the trash or waste from the production centre by utilizing it in making innovative materials. The company can encourage its employees to recycle waste, polyester, cotton products, and redesigning the trash to make more creative products. It would help them to maintain the environmental rules and regulations. The NIKE Company can also invest in introducing the girls’ play academy to change the lives of the girls by encouraging them through play and sport. The company can maintain the proper core labour rights by removing the underage employees and encourages them to continue their education.
4 key elements in their business plan:
The most essential plan for the business is the corporate strategic plan of the organization. This corporate strategy plan defines the organization's needs to move its business in a positive direction and also developed the proper strategic goals for achieving strategic management activities. The Nike Company can also maintain the proper corporate strategy plan along with maintaining the Four Key elements of the corporate strategy. These four key elements of the corporate strategy are visioning, setting of objectives, resource allocation, strategic trade-offs, or prioritization.
While developing the business plan for the company, the Nike Company can develop its corporate strategy plan based on these above-identified four key elements:
Visioning: It defines the company's needs to set the high-level direction for the organization including the effective vision, mission, and corporate values of the company. The Nike Company can maintain these steps while developing its corporate strategic plan by outlining its vision to bring innovation and inspiration in the mind of every athlete. Also by outlining their mission to bring innovation in sports, make sustainable products, develop a diverse and creative team, and also make a positive impact on society (Kajanus et al., 2019). The company can also outline the main corporate values of the Nike Company such as cultural diversity, empowering the employees by giving them proper respect, maintaining the proper environmental rules to make the world a better place for sports, etc.
Setting up the objectives: It defines the company needs to set up the objectives of the company based on the vision and mission of the company. The Nike Company can also set up its objectives based on its vision and mission. Such as:
- Bringing innovation and inspiration among the athletes.
- Introducing sustainable and effective products to expand the potential of the human.
- Creating a globally diverse and creative team.
- Creating a healthy planet, active and effective communities, and inspiring the community to develop an equal playing field for every people.
Resource allocation: It defines the company's needs to efficiently allocate human and financial resources to achieve corporate goals and aims. The Nike Company also allocates its resources depends on its goals and objectives of the corporate strategic plan.
The Nike Company can inspire its suppliers to develop its sustainable workplaces and also maintain a positive environment in their workplaces that would help them to make the company more productive and successful. The company can inspire its suppliers to use their human resources effectively and inspire them by providing the proper financial facility to increase the profitability of the company.
Strategic trade-offs: This element is the core element of every business plan. The Nike Company can also make their business strategies and decisions by entailing the degree of the risk associated with planning (Kajanus et al., 2019).
Based on the analysis of the Nike Company’s business strategy, the Nike Company can maintain the product differentiation strategy under Porter’s generic strategy along with the diversification strategy under Ansoff’s matrix by introducing the new products while expanding its business in the new market.
The workplace culture combines many elements such as language, symbols, values, norms, artefacts to create a unique way to develop a positive workplace environment. The purpose is one of the aspects of the company’s culture. The purpose defines the company needs to connect its employees with the goal and vision of the organization to inspire them to make difference in the world (Karizaki, 2017).
The Nike Company can also maintain this aspect of the culture by defining their purpose towards their employees to make a healthy planet and equal playing fields for all people from different regions and races. The company can also inspire its supply chain to maintain a healthy environment and give equal opportunity to both male and female workers to bring a difference in the world. It would help the company to increase worker engagement by maintaining a strong culture of safety.
Appropriate organisation structure: According to the business operation of the Nike Company, the most appropriate organizational structure for the Nike Company is a Divisional organization structure. It defines the company groups the function of the organization into a division. Nike Company expands its business globally so the geographical divisional organization structure is the most suitable structure for the Nike Company (Fairfield, 2016).
According to this organizational structure, the company can achieve these strategic factors in the following way:
Unity of command defines that the subordinate employees of the one department of the company should all be responsible for the single leader. The Single leader should provide direction to their subordinates regarding the business plan, goals, and objectives and inspire them to do their best for achieving the strategic goal of the company (Ben-Haim, 2019). The Nike Company can also maintain this structure by assigning the particular leader and manager for the particular department to maintain this unity of command principle.
Centralization Vs Decentralization:
Centralization defines the primary decision of the company that should be made by the person at the top of the organization hierarchy. Decentralization defines the company should involve both higher-level and lower-level employees in the decision-making process (Marume & Jubenkanda, 2016). The Nike Company may use the decentralization process for taking immediate decisions to continue its business operation. The Nike Company can use the centralization process while the long-term decision for the future progress of the company.
The span of Control defines the number of subordinates under each superior that can be managed by the superior efficiently and effectively. A narrow span of control defines the single supervisors should oversee few subordinates. It helps in close supervision and increases communication between supervisors and subordinates. Disadvantages are too much control over employees and high costs (Holm-Petersen, Østergaard, & Andersen, 2017). A wide span of control defines the single managers who oversee a large portion or number of employees. Advantages are more clear policies and more authority delegation. The Nike Company can use the wide span of a control policy for controlling its employees to operate its business operation. It helps the Nike Company to give the individual space to their employee that would help to increase their productivity.
Formalization is the process by which the manager specifies the rules, regulations, and responsibilities of the individual employees, units of the organization, teams, groups, and for the whole organization (Awasthi & Engelschalk, 2018). It helps the organization for the development of their relationships, processes, and operating procedures. The manager of each division of the worldwide Nike Company can utilize the formalization strategy by specifying the rules, regulations, and responsibilities of the individual employees, units of the organization, teams, and groups for the development of their operating procedures.
Traditional Leadership theory and Motivational Theory:
According to the above discussion, the company needs to maintain the proper leadership theory to lead their employees. The situational leadership theory is the best leadership theory for the Nike Company according to their business activities. The Situational leadership theory defines there is not a certain type of leadership to lead the employees of the organization effectively. According to this theory, the managers or leaders of the company adopt the appropriate leadership style based on the current situation and maturity level of subordinates (Thompson & Glasø, 2018). It means the managers and leaders of the Nike Company need to take an appropriate leadership style based on the particular situation and the development level of employees. It would help the managers and leaders to understand the skills and knowledge of the individual employee. It would also help them to take the decision and divide the responsibilities for the particular task among the employees based on their skills and knowledge. It would help them to motivate their employees and encourages them to share their knowledge with other employees to expand their skills, experience, and knowledge.
Based on the leadership theory, the Nike Company also needs to choose the appropriate motivational theory to motivate their employees effectively. The Nike Company can use Maslow’s hierarchy needs theory to motivate their employees. This theory defines that the company needs to fulfil the basic needs means the deficiency needs and growth needs of employees. According to this theory, the deficiency needs are security needs, physiological needs, social and esteem needs. The self-actualization need is the growing needs of the employees. The company needs to take care of these all need to motivate the employees of the Nike Company (Jonas, 2016). The Nike Company needs to provide the proper facility of foods, water, air, and a positive environment in the production centre of the supply chain. The company needs to provide financial security, health, and wellness security and also provide safety against accidents. The leaders and managers need to maintain a friendly relationship with their subordinates and provide them proper appreciation and respect according to their performance to meet the self-esteem needs. The most important is the company needs to provide the opportunity for growth to its employees. These factors would help the company to motivate positively.
The followings are the recommendations for the Nike Company for the next five years:
- The Nike Company needs to improve the working condition of the production centre of its supply chain.
- The Nike Company can maintain the situational leadership theory and Maslow’s hierarchy needs theory to lead and motivate their employee effectively.
- The Company needs to increase the use of recycled materials for developing more innovative products.
- The Nike Company needs to reduce discrimination against women employees.
- The Nike Company needs to take proper steps to reduce the carbon footprint from the production centre.
Based on the above discussion, it represents that the Nike Company should maintain the above-identified strategies and leadership and motivational theories to avoid the issues and weaknesses of the Nike Company. The company needs to focus on the above-identified recommendation to make a better future for the company. The Nike Company needs to take the appropriate steps for improving the working procedures of the business to achieve its organizational purposes. The Company needs to properly motivate their employees to increase their productivity and bring innovation within their services to make a difference in the world that would help them to increase the business profitability margin level.
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