Nike Inc.’s Management Quality & Organizational Success

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Introduction

These days, market competition has increased significantly, requiring the highest level of management quality. Considering all aspects of the internal and external environment to survive in this competitive market, most profitable companies achieve success through their innovations in business strategies and models. The long-term profitability of any organization follows effective management.

The most prominent example of such an approach is Nike. The US multinational company designs manufacture and market footwear, apparel, equipment, and accessories. It is essential to determine the link between effective leadership, employee engagement and economic prosperity. Moreover, despite COVID-19 outcomes, the business shows excellent financial performance and adequate management decisions.

Background

The Nike company’s success relies on a transparent approach to business and appropriate management. Since its founding in 1964, Nike, called Blue Ribbon Sports before, has become one of the world’s most recognizable brands (Childs & Jin, 2018). The company’s original focus was to provide professional athletes with specialized products and apparel to improve their sports performance (Childs & Jin, 2018).

In the beginning, Nike was focused on making products with an accent on design and manufacturing, as innovations improved the economic performance within the market (Childs & Jin, 2018). However, after rethinking the business strategy affected by several crises in the nineties, Nike changed its approach, reorienting it to customers and marketing (Childs & Jin, 2018). Relevant to its success, Nike entered the international market as a manufacturer of apparel and accessories for the amateur segment.

With regard to the 21st century, Nike has been showing notable economic success. Compared to 2010, the cost of securities was below $20 per share, while in 2020, it increased to well above $130 per share (NIKE – 41 Year Stock Price History. n.d.). The reason for the growth is an innovative approach to the creation of clothing and footwear, the transition to online sales, and marketing campaigns. This is the result of high management quality and personal engagement in the work process.

Pertinent Course Topics

The quality of management is an effective organizational system, including a high level of top and middle management qualifications. It aims to stimulate the employees’ working process by responding to the organization’s mission and values (Whetten & Cameron, 2019).

The precise distribution of responsibility and authority, implementation of the leadership principle, and a well-thought-out employee motivation practice can increase all workers’ involvement, positively affecting the company’s economic performance (Whetten & Cameron, 2019). Any goals and objectives can be achieved if the corporate leadership properly coordinates actions (Whetten & Cameron, 2019). The business success and failure depend on management quality and elaborated business strategy execution.

Another crucial factor in a company’s performance is employee engagement and motivation. It involves a physical, emotional and intellectual state that stimulates employees to accomplish their best work (Whetten & Cameron, 2019). Companies use employee engagement analysis to determine employee attitudes towards their work, and the business and assess managers’ and HR departments’ performance (Whetten & Cameron, 2019). Lack of empowerment results in helplessness and alienation; it is recommended to prioritize a positive climate as employee engagement affects total shareholder return, productivity, employee turnover, and customer satisfaction.

Discussion

Organizational Structure and Culture

Concerning the Nike organizational structure, the company consists of several departments. There are global and regional headquarters and subsidiaries (Kaushikkar et al., 2020). Moreover, it consists of shareholders’ meetings, the committee of directors, the supervisory board, executive director (Kaushikkar et al., 2020). There are multiple departments such as finance, production, marketing, personnel department, planning department, and research center (Kaushikkar et al., 2020). The organization’s functional structure combines business and professional specialization and improved coordination in operational areas.

The corporate culture at Nike reflects the mission and direction of the business. New employees are told stories that convey the company’s core cultural values (Childs & Jin, 2018). For instance, company founder Phil Knight was an outstanding middle-distance runner who started selling shoes from his car (Childs & Jin, 2018). The Nike company’s name was invented by sales manager Jeff Johnson, who saw the ancient Greek goddess Nike asleep (Childs & Jin, 2018). Managers of the organization make sure to tell these stories to the sellers. The purpose is to inspire workers that the principal value is not to maximize the profit from the sale of items but to continue to serve running and athleticism for the nation’s strength and prosperity.

Values and Ethics

Nike’s mission is to innovate and inspire all athletes in the world. In Nike’s understanding, an athlete is any person, regardless of physical capabilities and condition (About Us, n.d.). It is stated that the company does “everything possible to expand human potential” (About Us, n.d.). Besides, Nike’s philosophy is built on the principle of social responsibility (Nike Purpose, n.d.). The brand stands for healthy competition, promotes amateur sports, and helps aspiring footballers, runners, tennis players and basketball players achieve their goals.

Nike is primarily focusing on sustainability and investing in innovation. The company has set new goals for 2020, such as zero waste from manufacturing contract footwear used to be dumped in landfills or incinerated without energy recovery (Minimizing Our Environmental Footprint, n.d.). By the end of 2025, Nike intends to achieve 100% renewable energy at its own or operated facilities (Minimizing Our Environmental Footprint, n.d.). The company plans to reduce the environmental impact and apply sustainable materials in proceedings.

Management and Motivational Style

Management and motivation style play a crucial role in terms of the economic performance of the company. The organization’s current head, John Donahue, took the CEO position in 2020 (Executives, n.d.). Beforehand he was the president of cloud-based organization ServiceNow (Executives, n.d.). Donahue also chairs the board of management of the fintech company PayPal (Executives, n.d.).

His experience was one of the critical factors in the development of business strategy during the COVID-19 pandemic. Nike also strives to make employees feel proud of being a part of one of the most innovative companies (Childs & Jin, 2018). Team members are defined as Nike ambassadors; consequently, potential applicants perceive their business involvement positively (Childs & Jin, 2018). Driven by the belief that diversity encourages creativity and accelerates innovation, the company strengthens the promotion and preservation of various talents worldwide.

Business Strategy Execution

Nike’s business strategy execution results in the fact that the company is ahead of its market competitors. The company is transforming businesses through digital investments, data analytics, supply chain digitization, and predicting consumer preferences (Childs & Jin, 2018). In terms of crises, the company attracted attention in 2018 before the Black Lives Matter street protests. An advertising contract was signed with American football player Colin Kaepernick (Kim et al., 2020). Later, in 2020 protesting against police brutality, the athlete took a knee while singing the US anthem, which angered conservative Americans (Kim et al., 2020). Posts began to appear on social media where people burned their Nikes or cut company logos from socks and clothing (Kim et al., 2020). Despite reputational damage, Nike shares collapsed but then regained financial losses, and the number of sales increased.

Moreover, there is another factor that could have served to the company’s economic failure. The coronavirus pandemic has primarily negatively affected brands that sell non-basic products (Remko, 2020). This trend is since most consumers switched to economy mode and began to distribute their funds in favor of essential products or services (Remko, 2020). Nevertheless, unlike numerous other retail non-food sectors, Nike actively introduced digital technologies and online trading, which became the right solution against lockdowns (Remko, 2020). A brand’s pandemic business strategy can serve as an example of the best approach to trade during an economic crisis.

Employee Engagement and Support

Reliable to large companies, there should be the same principles applied to communication with workers as managing the customers. This approach increases employee engagement and benefits the corporate culture. Concerning Nike, worker amiability begins with a candidate-centered career website designed to create Nike’s image as an attractive employer (Childs & Jin, 2018). The company provides information about the advantages of joining Nike (Childs & Jin, 2018). Furthermore, Nike supports and motivates its workers all over the world.

The company also encourages the creation of communities of interest. Nike has eight internal social networks called NikeUNITED (Nike Employee Networks, n. d.). These are Ability Network, Ascend Network & Friends, Nike Military Veterans & Friends, Native American Network & Friends, Latino & Friends Network, Black Employee Network & Friends, Women of Nike & Friends, and PRIDE Network (Nike Employee Networks, n. d.). Networks assist in exchanging experiences and advancing professional life. Nike denies recruiters and HR managers’ bias at critical junctures in the hiring process (Childs & Jin, 2018).

When these situations arise, the company determines how to prevent discrimination by conducting blind reviews of resumes and eliminating the collection of candidates’ salary history (Childs & Jin, 2018). Thus, Nike fights against prejudice, considered the display of discrimination concerning agents.

Communication Effectiveness

Communication is a process associated with conveying information within an organization and the external environment effectively and efficiently. Concerning Nike’s case, the Marketing and Communication teams’ managers spend most of their resources on signing advertising contracts with famous athletes and partners with various groups, including academics (Childs & Jin, 2018). Moreover, the company has won two Emmy awards for its commercials (Childs & Jin, 2018). Effectiveness of communication is characterized by the main techniques applied, such as brand strategy, digital engagement and product presentation.

Alternatives

The company is often accused of violating women’s rights, expecting to improve policies to guarantee equal wages. Some workers oppose internal corporation methods that lead to gender discrimination. The concept that could have been applied in the scenario is creating confidence within the personnel (Whetten & Cameron, 2019). It allows exhibiting fairness and equity, caring and personal concern, competence and expertise (Whetten & Cameron, 2019). If Nike developed reliable performance measurement standards, pay and promotion settlements would prevent potential scandals and build a positive employer representation.

Proposed Solutions

Moreover, it is recommended to expand a women’s line of sports equipment to fight gender inequality. The latter might be prevented in case the situation with the lack of women in key positions would be changed. It is also necessary to implement a marketing campaign aimed at preventing imbalance. Previously, Nike launched a commercial with Serena Williams, supporting the fight against gender inequality and wage disparity (You Can’t Stop Sisters, 2020). If such a situation arises, the company can admit mistakes and take appropriate action to avert economic failure.

Recommendation

Consequently, Nike needs to change its compensation program to address inequalities among its employees in the next few years. The HR department should analyze and improve a plan for diversity within as many organizational groups as possible. Gender equality goals can be set not only for the enterprise but also for each unit within each department’s business and group. This policy can reduce wage imbalance and prevent complaints and damage to the company’s reputation.

Personal Conclusion

In my opinion, the company’s management should determine the prospects and anticipate the development of the company’s functioning for several years ahead. Considering the possible consequences of implementing various strategies and choosing the best option, Nike generates effective results when the corporate leadership and workers become a team. Employee engagement and satisfaction are linked to the quality of a company’s management. If a manager has creativity, dedication, and enthusiasm, it will enable workers to think in a positive manner and motivate them.

Case Conclusion

To sum up, the tendency for Nike’s development is the course toward digital transformation and new technologies. The company’s principal mission is to enhance sports industry leadership and innovation (Childs & Jin, 2018). Concerning employee engagement, the company strives to unleash its workers’ potential (Nike Employee Networks, n. d.). Management quality was seen in terms of the coronavirus outbreak (Remko, 2020). Nike’s digital transformation strategy during the pandemic can not be easily replicated. It was focused on online projects, the power of a well-known brand, significant marketing efforts, and the products’ quality and innovation (Childs & Jin, 2018). Therefore, due to proper management and business strategy, the pandemic has become a considerable boost for Nike’s business.

Nike continues to develop new technologies, and create trends and directions. Empowerment and support are the fundamental elements of the relationship between corporate management and the team. The head can demonstrate faith in employees in their actions, such as the degree of control over the employee or delegation of authority. Thus, having a beneficial effect on the workers’ performance indicators, motivation benefits Nike’s economic performance by performing excellent results in the long-term.

References

About Us. (n.d.). Nike. Web.

Childs, M., & Jin, B. (2018). Nike: An innovation journey. In E.Cedrola (Ed.), Product Innovation in the Global Fashion Industry, pp. 79-111. Palgrave Pivot.

Executives. (n.d.). Nike.

Kaushikkar, A., Kirkewoog, S., Merckling, E., Prabhu, S., Daim, T. U., & Meissner, D. (2020). Sports Innovation. In T. U. Daim, & D. Meissner (Eds.), Innovation Management in the Intelligent World, pp. 119-137. Springer.

Kim, J. K., Overton, H., Bhalla, N., & Li, J. Y. (2020). Nike, Colin Kaepernick, and the politicization of sports: Examining perceived organizational motives and public responses. Public Relations Review, 46(2), 1-10. Web.

Minimizing Our Environmental Footprint. (n.d.). Nike. Web.

NIKE – 41 Year Stock Price History. (n.d.). Macrotrends. Web.

Nike Employee Networks. (n.d.). Nike. Web.

Nike Purpose: Purpose Moves Us. (n.d.). Nike. Web.

Remko, V. H. (2020). Research opportunities for a more resilient post-COVID-19 supply chain–closing the gap between research findings and industry practice. International Journal of Operations & Production Management, 40(4), 341-355. Web.

Whetten, D., & Cameron, K. S. (2019). Developing Management Skills (10th ed.). Pearson Education.

You Can’t Stop Sisters. (2020). Web.

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BusinessEssay. (2023, January 16). Nike Inc.'s Management Quality & Organizational Success. Retrieved from https://business-essay.com/nike-inc-s-management-quality-and-amp-organizational-success/

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"Nike Inc.'s Management Quality & Organizational Success." BusinessEssay, 16 Jan. 2023, business-essay.com/nike-inc-s-management-quality-and-amp-organizational-success/.

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BusinessEssay. (2023) 'Nike Inc.'s Management Quality & Organizational Success'. 16 January.

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BusinessEssay. 2023. "Nike Inc.'s Management Quality & Organizational Success." January 16, 2023. https://business-essay.com/nike-inc-s-management-quality-and-amp-organizational-success/.

1. BusinessEssay. "Nike Inc.'s Management Quality & Organizational Success." January 16, 2023. https://business-essay.com/nike-inc-s-management-quality-and-amp-organizational-success/.


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BusinessEssay. "Nike Inc.'s Management Quality & Organizational Success." January 16, 2023. https://business-essay.com/nike-inc-s-management-quality-and-amp-organizational-success/.