This leads to wastage of money and other resources of the firm. Profits have grown 57% and Nike… Consequently, the firm’s tactic of employing creative and innovative ways to market their products is commendable. “We are fortunate to have built a strong and deep bench of talent across our organization. Menguc, B., & Auh, S. (2010). The company has gone through several controversies including the child labor allegations in 1990, strike in Yue Yuen Industrial Holdings Dongguan shoe factory (China) in 2014, and so on. One global division is responsible for managing the worldwide operations of Converse, which is another footwear brand and subsidiary of Nike Inc. Another global division is responsible for licensing the Nike brand. First, when a single person is working on more than one jobs, he is answerable to more than one bosses. People have specialization and perfect skill sets and their placement is with similar people in a group. Nike Inc. Generic Strategy & Intensive Growth Strategies, Nike Inc. Martin, R., Muuls, M., de Preux, L. B., & Wagner, U. J. Nike’s organizational structure also has two global divisions: one for the Converse brand and another for brand licensing. It is basically in the name, the organizational structure of Nike has global corporate leadership which involves corporate managers. Moreover, lack of coordination, which is highly likely, can prove to be fatal for the organization. This flexibility is especially notable in how the company markets its products through company-owned NikeTown stores. The notable features of the Nike organization include; worldwide collaborate management, semi-autonomous geographic divisions and global divisions for converse and licensing of brands … The global corporate leadership at Nike which involves corporate leaders makes sure to implement policies throughout the company that is, in all divisions. Save my name, email, and website in this browser for the next time I comment. An effective organizational management structure could contribute to the acceleration of the innovation in the contemporary business environment. Corporate diversification and organizational structure: A resource-based view. You need to focus on the external elements that influence the brand's activities. Over the year, Nike implements efficient innovation management structure that assists the company to achieve effective innovative process. They promote the mindset of self-leadership, accountability, control, and self-development. Nike has a geographic divisional organizational structure. For example, the Global Sports Marketing group releases new athletic shoe marketing campaigns for worldwide marketing. You can edit this Organizational Chart using Creately diagramming tool and include in your report/presentation/website. A Organizational Chart showing nike. First, the regional divisional structure allows Nike to provide different goods in different regions in relation to the preferences of people in those regions. (2015). Nike's adopted a matrix kind of structure which is based on a geographical divisional organizational structure. For GDPR compliance, we do not use personally identifiable information to serve ads in the EU and the EEA. Nike aims to be a brand with purpose that moves the world forward. Nike’s organizational structure is one of the best organizational structure examples in the world. A company’s organizational or corporate structure is the composition and system design applied on the interconnections among employees, groups, and divisions of the business. We’re a strategy, business & marketing resource. familiar with common problems and concerns in their Groups According to Flatworld Knowledge, Nike is a model of a successful company that uses this structure effectively. Office of the President & CEO, Nike, Inc. Liao, C., Chuang, S. H., & To, P. L. (2011). Hence, this prevents them from doing any unethical or inappropriate thing that might harm the entire firm’s image. This means that the tasks of each functional group are done quickly. Anatomy of a paradox: Management practices, organizational structure and energy efficiency. Edit it online with your organizational information and import it as an image or PDF.--You can edit this template and create your own diagram. Disseminative capacity, organizational structure and knowledge transfer. Nike’s Organizational Structure MGT 330 July 12, 2010 Nike’s Organizational Structure Nike is a “Global marketer of athletic footwear” (Nikebiz, 2010) Nike operates in 160 countries and has many brands including Nike Golf and Air Jordan. d. New trend in contemporary organizational structure design makes chain of command lose its importance. Markides, C. C., & Williamson, P. J. The advantage of the semi-autonomous regional (geographic) divisions is flexibility in satisfying regional market-specific consumer preferences for Nike’s athletic shoes, apparel and equipment. Through this feature of Nike’s organizational structure, decisions are easily implemented throughout the company. Other brands that Nike owns are Bauer, Hurley, and Exeter which also have the same structural characteristics as Converse. (1996). This is the reason why you can find different variety of Nike products in your country in comparison to another country. Nike is a powerful example of corporate culture because Parker is serious about reinvigorating his organization on a regular basis. Nike Organizational Structure By: Abby Huskey and Helena Harris Structure Efficiency Strengths ability and resources to make products managers have first hand information and experience with how their departments operate. We use cookies for website functionality and to combat advertising fraud. Nike’s network structure enables direct communication across unit and firm boundaries, which ignores the chain of command. Development and return on execution of product innovation capabilities: The role of organizational structure. All the departments of a functional structure come under the president. Global corporate leadership has the advantage of facilitating control on the entire organization. A major part of Nike’s success is due to Nike’s organizational structure. The Converse is another footwear brand that Nike owns and management in its division controls its operations. See our Privacy Policy page to find out more about cookies or to switch them off. This structural support, together with Nike’s organizational culture, helps the company in combating the financial and business developmental effects of competitors, such as Adidas, ASICS, Puma, and Under Armour. A divisional structure is characterized by internally grouped products, projects, or product markets. This structure is based on the company’s needs in its global organization, as well as the uniqueness of conditions in regional markets. First, the company seeks to foster a spirit of belonging among its employees. The company’s operations are divided into segments based on regional markets. These differences are linked to region-specific demands of target customers, such as variations in the preferences for apparel based on sports popularity and climate. The product design is done specifically for their needs. Such regionalization promotes value chains that specifically fulfill customers’ expectations, especially in the area of service and marketing. Adding to this, the teams within the organization might start having unhealthy competition amongst them to win over each other. Geographic divisions are a major organizational structure characteristic of Nike, Inc. Nike was established to function under a matrix structure, in which dual lines of authority are created, functional and products are combined and then grouped together. This is to make sure that the development and innovation keep happening in all products that Nike manufactures. Nike's Organizational Culture- Rodisel 1. (2012). On the other hand, the Nike licensing division, as its name suggests, controls the licensing of the Nike brand name. The Comm… Moreover, there are functional departments under the Global corporate leadership, and there is also a team structure in the organization. A strict organization or hierarchical structure is followed within the company to ensure that everything remains in order and that the responsibilities and roles are properly divided and distributed. The unnecessary grudges and conflicts arising from this can be detrimental for the firm as well as the employees. Training programs are designed to uphold such corporate culture that aligns with the Nike brand image for sports footwear, apparel and equipment. Nike follows this organizational structure in the way that they group their divisions according to each sport. These managers decide for the global organizational structure of Nike. Nike’s revenue from the Running category has grown by 7% from 2017 to 2018 (5% on a currency-neutral basis). The company has subcontracted its most crucial operation, which is manufacturing itself. At NIKE, we excel as a team. Under this leadership comes a functional structure that divides finance, global human resources, product & merchandising, administration &legal, global sports marketing, and operations departments. By continuing your navigation, you consent to their use. Each business center of the company focuses on their operation like research, marketing, or production. Through this structure, it is easy to implement decisions throughout the whole … Nike’s all-time popular slogan, “Just Do It,” is also featured in our best slogans list. Love, J. H., Ashcroft, B., & Dunlop, S. (1996). Nike responded by decentralizing authority and varying its product line. Why Brand Architecture is Fundamental to Building Power Brands? Organizational Culture Characteristics: An Analysis, Nike Inc. SWOT Analysis & Recommendations, Nike Inc. Operations Management: 10 Decisions, Productivity, Nike Inc. Five Forces Analysis (Porter’s Model), Nike Inc.’s Marketing Mix (4Ps/Product, Place, Promotion, Price) - An Analysis, Nike Inc. 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A matrix structure is made up of different types of organizational structures. Content Theories: What Really Motivates Us. In particular, the case highlights Nike's organizational structure that consists of a global matrix organization that is replicated at a regional level for the European market. Moreover, setting regional divisions at different places helps in promotion too. The subdivision for EMEA, which Nike’s European headquarters manages, replicates this structure, while the U.S., the Americas and Asia Pacific locations are housed within the global headquarters’ oversight. panmore.com/nike-inc-organizational-structure-characteristics-analysis The structure attempts to meet the demands of the company globally and regionally. The matrix structure, as a whole, uses the scarce human resources of the firm very efficiently by employing a single person for more than one jobs. Learn how your comment data is processed. Strong human resources policies and capable, qualified management are essential for all Nike suppliers to be compliant with the law and our Code Leadership Standards. To achieve that, we need all parts of our value chain to understand and deliver on our goals—from our leaders to product designers, to the employees in our stores, and workers in contracted factories who make our products. Best Green Tea Brands in the world in 2020: What makes them the best? Two divisions will have different departments for the same function, no matter how small the divisions are. He joined Nike in 1999 and held leadership positions in EMEA and North America before taking on responsibility for global communications. Nike is a powerful example of corporate culture because Parker is serious about reinvigorating his organization on a regular basis. Conceptual Provisions of Formation of the Quality Management System Within the Integrated Corporate Structure. 4. The characteristics of its corporate structure provide Nike with flexibility to address consumer preferences for athletic shoes, apparel and equipment in regional markets. In the Nike brand, teams work across footwear, apparel and equipment product engines. Profits have grown 57% and Nike’s market cap has more than doubled. To achieve that, we need all parts of our value chain to understand and deliver on our goals—from our leaders to product designers, to the employees in our stores, and workers in contracted factories who make our products. As such, Nike Inc. has developed its organizational structure to enable adjustments in dealing with market differences. Revenue from the Jordan brand fell by around 8% (9% decline on a currency-neutral basis) in 2018 compared to 2017. This is because one department will not be aware of the plans of the other departments. Nike’s organizational structure is a matrix structure. Structural and strategic alignment that considers these variations reinforces Nike’s competitive advantages, especially in penetrating regional markets. It is the world’s largest supplier of athletic shoes and apparel. PESTLE analysis of Nike brand. SPAN OF CONTROL: NIKE’S ORGANIZATIONAL CULTURE BY: JEFF RODISEL 2. The Nike brand includes footwear, apparel and equipment in six core categories: running, basketball, football (soccer), women’s fitness, golf, and tennis, men’s training and sport culture.vii Nike products are sold through Nike owned stores and independent distributors in over 160 countries viii. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. Employees must have the abilities to think outside the box and understand things from a local and global business perspective (Lukinate & Sondaite, 2017). Nike Inc.’s organizational structure’s characteristics support growth and stability. Nike follows a matrix organizational structure which is a combination of horizontal and vertical structures. Nike follows geographical divisional structure to facilitate customers in different areas. There are slogans that everybody ends up memorizing, and some such as "if you have a body, you're at athlete" are the sort of inclusive, empowering slogans that the company uses to make its products attractive to a broad audience. The organizational chart of Nike displays its 145 main executives including John Donahoe, Matthew Friend and Andrew Campion × We use cookies to provide a better service. The following are the main global leadership groups headed by a President, Executive Vice President, or Chief Officer: Semi-Autonomous Geographic Divisions. familiar with common problems and concerns in their Groups North America, Western Europe, Central & Eastern Europe, Greater China, Japan and Emerging markets are the regional divisions of Nike structure. From visiting public places to getting famous sports stars in their advertisements and holding shows with those sports stars to gain people’s attention. In Nike’s case, the corporate structure highlights the need to address differences among regional markets. The organizational chart of Nike displays its 145 main executives including John Donahoe, Matthew Friend and Andrew Campion × We use cookies to provide a better service. Analysing various aspects of the brand with SWOT analysis gives the case study on Nike brand major insights about Nike organisational structure. But there is a limitation to that autonomy. Adding to this, the functional structure helps in enhancing the best form the workforce. There is no manufacturing of standard products for the entire world’s population. The managers have an office in the headquarter of Nike which is located in USA. The NIKE environment is a collaborative, matrix organization, where team members often report into two areas, such as a geography and a global function. Type above and press Enter to search. The following characteristics are notable in Nike’s organizational structure: Global Corporate Leadership. Even though, this structure may seem complicated, but Nike has been able to leverage it … The Matrix Structure and Nike The purpose of the Audit & Finance Committee (the “Committee”) of the Board of Directors (the “Board”) of NIKE, Inc. (the “Company”) is to provide assistance to the Board in fulfilling its legal and fiduciary obligations with respect to matters involving the accounting, auditing, financial reporting, and internal controls of the Company and to oversee the financial policies and activities of the Company that may have a material impact on the results of operations or the financial position of the Company. This allows them to become specialists in their particular field, makes them best for the job. With our Nike case study analysis, you can have a better understanding of these areas. The research plan may face postponement due to low funds. 18+ Risks and Disadvantages of Technology, How to Build Your Business Identity on a Tight Budget. Enter your email address below to subscribe to my newsletter. Organizational Structure Characteristics (Analysis) Updated May 8, 2016 Andrew Thompson Nike Inc.ʼs organizational structure reflects the abilities and limits of the business in its operations. The regional divisions are given autonomy in taking decisions in their regions. Nike’s organizational structure is worthy of study due to the fact that it has been a successful organization since its inception. This not only increases Nike’s sales, but it also helps it to enforce its brand image all across the world by not letting the competitors settle in. This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. This site uses Akismet to reduce spam. What is a Triple Net Lease? Each regional division’s managers optimize operations in the regional sports shoes, apparel and equipment market. Concepts from Chapter 15 and the organizational structure of the organization. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. The Nike environment is a two-way, matrix organization, where team members often report into two areas such as geography and a global function. This characteristic of the corporate structure offers control for brand licensing and the operations of Converse. NIKE Founded in 1964 by Bill Bowerman and Phil Knight Headquarters located in Oregon Produces athletic footwear, apparel, sports equipment, and other sports and athletic products Currently worth over $90 billion Other divisions within Nike organizational structure are the subsidiaries’ and Nike licensing divisions. This not only increases their incomes but also motivates them to do even better. Nike aims to be a brand with purpose that moves the world forward. In particular, aspects of regional management and the splitting of functions and responsibilities between global headquar-ters and regional headquarters in Europe are highlighted. Nike has an organizational culture that encourages human resources to behave in ways that address business objectives. View Nike's Organizational Chart.docx from ORG 535 at University of Phoenix. Corporate structure, ownership and the likelihood of innovation. Nike manages and structures its worldwide operations. Despite the problems, the firm has been thriving over the years and has no plans of going down anytime soon. Prior to Nike, he worked at Edelman in Brussels, representing and advising clients on the WTO, EU relations, corporate reputation, issues … She also oversees Nike's Marketplace Partners organization and leads the Nike Brand's four geographies: North America; Greater China; Europe, Middle East and Africa (EMEA); and Asia Pacific and Latin America (APLA). As one of the leading players in the athletic footwear, apparel and equipment industry, the company and its corporate structure serve as an example of how regional variations must be included in business strategies. The managers have offices in the company’s headquarters in Oregon, USA. … Key Facts & Figures Nike employees report directly to a product teams. First of all, the global corporate leadership. The matrix structure of Nike also accumulates the disadvantages of all different types of organizational structures in it. However, a disadvantage of Nike’s organizational structure is the limited approach to managing the operations of Converse. The matrix organizational structure of Nike accumulates advantages of all different types of organizational structures within it. This case describes how Nike, a consumer goods company with an ever expanding portfolio and a tremendous brand value, manages the tradeoff between local responsiveness and global integration. An organizational structure defines task delegation, and line authority establishment within an organization. The organisational culture at Nike is reinforced in a number of ways. On the other hand, it follows a divisional structure on the product basis. The operations of each division are separate from each other. In relation, the organizational structure supports initiatives and strategies contained in Nike’s marketing mix or 4P. For example, the research and development department may be planning to conduct research on a new kind of product, but at the same time finance department feels that there is too much idle money and it invests the money somewhere. They decide for the global corporate structure of Nike. Nike Organizational Structure By: Abby Huskey and Helena Harris Structure Efficiency Strengths ability and resources to make products managers have first hand information and experience with how their departments operate. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. De unieke platte structuur van Nike, de AKA-matrix, tart het traditionele CEO-met-meerdere-ondergeschikte model waar veel bedrijven van Nike's statuur op vertrouwen. Press Esc to cancel. By continuing your navigation, you consent to their use. Org chart highlighting visualizing the Nike organizational structure. Copyright by Panmore Institute - All rights reserved. Salimova, T. A., Biryukova, L. I., Makolov, V. I., & Levina, T. A. Nike’s organizational structure has global corporate leadership, which involves corporate managers. Nike’s organizational structure has the following regional divisions: Global Divisions for Converse and Brand Licensing. Nike’s flat structure, also known as a matrix structure, consists of several divisions separated into subsidiaries: Converse, Hurley and others, which all report to Nike’s global headquarters. Nike Inc. has an organizational structure that facilitates regionalization of business strategies. The organizational structure of Nike Inc. most closely resembles that of the divisional structure. Nike Inc.ʼs organizational structureʼs characteristics facilitate control and flexibility in the business. Despite changes in the market environments, Nike has stuck to its decentralized and networked organization structure. It not only brings about efficiency but also reduces the chances of error. Nike’s wholesale equivalent revenue from ‘Running’ products grew to $5.2 billion in 2018 from $4.9 billion in 2017. A close check is kept on these divisions. The firm has chosen, from different types of organizational structures, the one that suits them the most. (Photo: Public Domain) Nike Inc. Being a prospector, Nike Nike Air Zoom track shoes. An organizational structure defines task delegation, and line authority establishment within an organization. Optimize operations in the way that they group their divisions according to Flatworld knowledge, Nike a. Website in this browser for the job is commendable which also have the structural... In promotion too that might harm the entire world ’ s organizational structure defines task delegation, there. Authority establishment within an organization known as a flat organizational structure of Nike ’ s organizational Chart! To wastage of money and other resources of the company to achieve effective process! 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