From the e-Activity, evaluate the success of Nike’s network-structure in terms of centralization of authority and horizontal differentiation.
Nike is a brand of sportswear that originated in the United State and is now a global recognized brand, the success of Nike can be attributed to Phillip Knight and Bill Bowerman, co-founders of Nike; today the brand is a multinational company. Nike authoritative management style stems from a centralized approach to leadership. An example of Nikes leadership style can be seen in the aftermath of a well-publicized case charging one of Nike distributers of violating child labor practices. As a result, CEO Phillip Knight reevaluated Nike’s labor practices and announced that all factories producing its products would be independently monitored and inspected. Thus, showcasing social responsibilities to regions that believed in such practices.
Nike redefines leadership on a global level by investing in the communities in which they produce goods and services at low cost prices. In addition to being co-founder in the GreenxChange. Nike supports Lance Armstrong Live strong campaign and its wonderful Girl Effect campaign in partnership with the Clinton Global initiative.
The world is interconnected and companies are competing within their borders and against multinational companies. What makes Nike different is the essences of their strategy. Nikes differentiation resides in the power of its brand. Consequently, Nike horizontal differentiation, can be seen in the product offering itself. Nike offers horizontally integrated portfolio of products for every major athletic activity.
Analyze the fundamental manner in which the company’s outsourcing strategy facilitates both resources sharing and the leveraging of its competencies around the world. Provide a rational to support your response.
According to the e-Activity, Nike outsourcing strategy, complies of subcontractor throughout the globe. While moving manufacturing offshore by creating partnerships with third world they able to cut cost. A vast majority of its product is produced in Asia. By outsourcing manufacturing their product, Nike is able to focus on their core competencies. Nike competence based strategy is part of the overall strategy concerning technology, and the introduction of its environmental friendly recyclable rubble used in manufacturing its products. Nike shares its patent recyclable product with other corporation for a small fee.
From the e-Activity, evaluate the appropriateness of the type of types of basic strategies that Nike implements in order to expand globally. (Note: to evaluate means to state what works and what doesn’t work)
Nike basic strategies revolves around building trust around corporate responsibility initiatives to increase loyalty among existing customer including their ability to be innovative thinkers. In addition to delivering and introducing superior products in the marketplace. Nike executes a strong global presence by understanding the issues and how they impact everyone. According to (Nike Inc, 2014) the creation of the North Star (international non-profit organization) brings about change on a global level by focusing on education and resource sustainability. Nike drives industry change through multi-stakeholder partnerships. According to Nikes community development report (Stephen Serpell, Director, 2014) these stakeholders include but not limited to; World Wildlife Fund: Climate Savers Initiative, Business for Social Responsibility, Green Blue Sustainable Packaging Coalition, Phylmar Working Group and the National Recycling Coalitions. Nike has proved without a doubt in that the company is dedicated to a more sustainable future, in addition, Nike has a hugh impact on people and resources around the globe.
Next, analyze the most important manner in which Nike’s Organizational structure, control systems, and culture influence its international strategy. Provide a rational to support your response.
What differentiated Nike from its competitors was more than its shoe strategy. Nikes’ goal was to distribute low-cost product with high quality. Nike was able to do this by outsourcing its manufacturing to underlining third world countries, i.e. Asian. Nike offers athletic shoes at every marketable price point on a global level. Their corporate culture, is rich with employee loyalty. Nike strives towards an inner culture that promote a lifestyle.
In addition, to promoting a teamwork environment, Nikes management keeps employees update on Nikes success. Nike asks employees to work within two principles: 1) honesty and 2) competition. Their distinctive competency are the following: 1) brand awareness, 2) investment in the community through contributing to non-profits, 3) developing environment friendly products, and 4) investing in technology to bring about environmental changes on a global level. Nikes ability to create economic opportunities by splitting profits and sharing knowledge sets them apart from the competition (Hill & Jones 2013).
Hill, C., & Jones, G. R. (2013). Strategic management: An integrated approach (10th ed.). Independence, KY: