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Social performances of organizations

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Social performances of organizations

Introduction

The modern global economy is intertwined and interdependent and so business-to-

company ties are highly Complex. Nike Corporation became one of the most successful

corporations in America in its fiscal years reported and published by Fortune magazine. Nike is

the largest seller of athletic footwear and athletic apparel in the world and has approximately

18,000 retails in the US.

The Nature of Nike Company

The design, production and marketing of high-quality boots, garments, and equipment

and accessories items worldwide are Nike’s primary business operation. Nike is the world's

leading retailer of fitness and sportswear. Nike markets its goods to retail accounts and in more

than 120 countries worldwide through a variety of independent distributors, licensees and

subsidiaries (Borts, 2). Independent suppliers manufacture practically all the Company products.

Almost all footwear and clothing items are made outside of the United States, and equipment is

produced in and outside the United States.

The structure of Nike Company

Nike Company has a geographic divisional organizational structure. The structure is focused

on the needs of the client in its global organization, along with the complexity of dynamic

market conditions. Nike Inc. has a corporate structure promoting market plan regionalization (2).

Such regionalization supports value chains which meet customer expectations in particular in the

field of service and marketing. The key features of Nike’s organizational structure are as follows;
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i. Global divisions for Converse and brand licensing

ii. Global corporate leadership

iii. Semi-autonomous geographic divisions

The advantage of Nike Company geographic divisional organizational structure is that it

supports the growth and stability of the Company. International business management has the

power of making the entire organization's operation more straightforward (2). The advantage of

the national (geographical) semi-autonomous divisions is a versatility to satisfy Nike's athletic

apparel, clothes and equipment in terms of regional and consumer preferences. Moreover, the

downside of Nike’s organizational structure is that the approach to Converse’s management is

tight.

Types of products and services of Nike Company

Nike footwear is the most extensive product line of the Company, with sales accounting

for over 60% of the famous Jordan Brand and other collections. The Company’s products which

make up about 95% of overall sales are based on six main categories that are the Jordan Brand,

Football, fitness, running, Nike Basketball, and sportswear (Childs and Jin, 3). Nike Clothing

accounts for approximately 30% of sales and adds another five% to Nike Hardware, that is safety

equipment, devices, bates, fitting balls, clocks, and bags. Converse, Hurley and other brands add

the remaining sales.

Key factors in Nike’s external environment that can affect its success.
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i. Improving government support for infrastructure. Growing government support for

infrastructure, particularly in developing countries, allows Nike to expand his activities in

these markets hence boosting Nike’s success(3).

ii. The stable political climate in most significant markets. In most key markets, Nike can

expand his Company in those fields in stable political conditions.

iii. Expanding free trade policies. Developing free trade policies help to increase consumer

penetration abroad.

Ways in which the primary stakeholders influence Nike’s organizational performance

Today, social consciousness and group engagement have been incorporated into corporate

administration. And the effect of key stakeholders on the business activities of most companies

has increased considerably (Constantine, 4). The most critical group of stakeholders that carries

the weight of operations and decisions of the Company are employees, customers, corporate

partners and businesses. Therefore, understanding how such stakeholder groups impact business

is highly relevant for small and large companies. The leading players in the success of the Nike

Group are the owners, staff, senior management, vendors, consumers and others.

i. Shareholders. The views and aspirations of company partners influence the degree to

which the organization adopts environmental policies and thus affects the efficiency of

the organization (4).

ii. Employees. Personnel is more likely to impact Nike Company's financial results. Nike is

expected to be dedicated to the commitment and the fulfilment of the criteria of corporate

responsibility, along with many other corporations.

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iii. Supplier. Supply Chain Management, a traditional form of logistics management, has

close cooperation between the purchasers and suppliers who aim to give final consumers

the best value.

iv. Customers. Consumers have a significant effect because they commonly agree that long-

term interactions and customer loyalty are the secrets to success that is competitive and

sustainable.

v. Top management. Nike Company Senior Management will influence the Company by

achieving its short and long-term goals and its project financing ability (4). The

perceptions and aspirations of corporate managers change the degree to which the

Company adopts environmental policies.

Controversial corporate social responsibility concern associated with Nike

In the sports shoes and clothing industry, Nike is the most famous brand. In the past,

Nike has faced many conflicts in its supply chain over child Labour and ethics. The contentious

issues surrounding Nike controversial corporate social responsibility is the Nike Sweatshops

(Almiya, Kee, Haron, Nasharudin, Nasruddin, and Johari, 1). Nike is accused of Nike’s

Indonesian factories have low wages and lousy working conditions.

Among the claim facing Nike Company included the report that employees at the Nike

contract factory in Hansae, Vietnam have endured salary robbery and physical violence above

the legal limit of 90 degrees for hours in terms of temperature to the extent where they collapse

on their sewing machines.

Nike has also been accused of cutting jobs in the Hansae plant and pulling out a

Honduran factory with a strong presence of the Union, resulting in the loss of hundreds of
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critical employment(1). The Company has also recently denied access to its contract factories by

the independent Worker Rights Consortium (WRC) monitoring group.

Consequently, Nike made a variety of changes over the past decade to boost her

reputation in the world. These investments have begun to yield results, which can be seen in their

improved financial and operational efficiency (1). Nike has reached many significant

achievements in both CSR and sustainability.

Conclusion

As a matter of urgency, responsible management and ethical productivity for most

businesses globally are valued. It should primarily be regarded as a method instead of a

consequence in achieving responsible management. The incorporation of CSR into the business

plan requires a continuous awareness, adjustment and monitoring process. And not only

businesses are fighting, but society is fighting. Nike Corporation aims to improve the social

impact on the organization. CSR has been included in the Company's plan. They are in the

process, but that does not mean that the business has no challenges and stuff to improve. Nike's

emphasis on raising its effect on the environment has grown in recent years. The organization is

also looking to increase its production volume. The goal is to create a better future for the planet

and its people through sustainable innovation.

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References

Almiya, M.S., Kee, D.M.H., Haron, M.Z.B., Nasharudin, M.I.B., Nasruddin, M.M.B.M. and

Johari, M.E.W.B.M., 2020. Consumption of Plastic and Sustainability Efforts of Nike

towards Green Environment. International Journal of Applied Business and International

Management, 5(1), pp.60-73.

http://ejournal.aibpm.org/index.php/IJABIM/article/view/768

Borts, A., 2018. Nike, inc.-athletic footwear and apparel (Doctoral dissertation).

https://run.unl.pt/bitstream/10362/36379/1/Borts_2018.pdf

Childs, M. and Jin, B., 2018. Nike: An Innovation Journey. In Product Innovation in the Global

Fashion Industry (pp. 79-111). Palgrave Pivot, New York.

https://link.springer.com/chapter/10.1057/978-1-137-52349-5_4

Constantine, I., 2018. An analysis of the nature and role of reciprocity within the Nike x

Basement Collective co-creation strategy. Journal of Promotional Communications, 6(2).

http://promotionalcommunications.org/index.php/pc/article/viewFile/132/142