Nike Company Corporate Structure and Strategy Essay

The modern world is changing quickly and rapidly, this affects all of the spheres of people’s lives and of course, it makes a big impact on the markets. This is why in order to stay competitive and hold the positions in the business arena the companies have to be flexible, and the managers need to frequently come up with ideas for changes in order to improve the business and enforce its further development by means of adjusting to the changes happening in the world around and within the organization.

Nike is a strong competitor in the modern sports market; this is why in order to continue being popular the company needs to change. The external factors that force Nike to make shifts are the consumer demands and preferences that the company constantly needs to research and follow; and technological progress that influences the production costs, distribution costs and the manner of advertising. Internal factors that make an impact on the company’s work process are the diversity at the work place and the inner policies making sure that the employees and the managers of the company are satisfied with their work conditions. Besides, Nike today is very careful about social responsibility and workplace ethics.

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The business of Nike specializes on sport footwear, clothes and accessories for men, women and children. The company manufactures products for different kinds of sports such as football, basketball, golf, tennis, volleyball, bicycling. Besides, there are non-professional lines of sport clothing and shoes for recreational activities such as swimming, hiking, camping. Nike operates from two hundred countries; the company has thousands of employees all over the world. The goals and focuses of the company have been changing a lot lately. The company has developed several brands such as Converse that respond to fashionable demands of the customers.

Nike organization is divisional. This means that the company’s structure contains multiple divisions. Some of them are based on specific products, some are mainly functional. Besides, the design, legal and investor departments are also parts of Nike’s divisional structure (Nike’s Organizational Structure 2010). Of course, a company with such large number of employees and branches all over the world has to divide its structure into various departments responsible for different aspects.

Moreover, Nike owns several different brands specialized on different kinds of sports. The functional and divisional structures of Nike generate various possibilities for the company’s further development. Originally Nike is an American brand, but it is a well known fact that the major part of all its production comes from abroad, where Nike has subcontracting relationships with the partners. These relationships vary in their loyalty, integrity and determination (Corporate Structure and Strategy: the Case of Nike n. d.)

Today many organizations are forced to re-structure because the modern business environment keeps getting changed by the occurrence of smaller businesses that create a tighter competition. The structure that Nikes operates through is matrix. The organizations that appeared in 1970s are to change the way they operate and the systems they use in order to stay modern and flexible in the developing and globalizing market.

The complexity of the company and the fact that the number of departments, responsible for different functions is huge, the matrix structure suits Nike the best. This structure allows the company having multiple lines of management and authorities. Basically, the system operates through a big number of teams that have to report to different managers. The heads of the departments of the company have the power to make decisions and act without being dependent on the CEO (Qaintance 2013).

I would recommend that the company enforces its relationships with the partners and foreign manufacturers in order to avoid problems with inner loyalty and social policies of equality and ethics. In countries like China, which has some Nike factories, there might be difficulties, especially when the lines of authority are weakened by the fact that departments are allowed to operate on their own.

The contemporary world is globalizing quickly, this means that the completion in the market and business is growing, the technologies develop quickly, and people migrate from one part of world to another creating changing factors for the distributors from the inner and outer sides of the business. The contemporary companies, especially the ones that represent big global corporations have to move along with the progress and adjust to the shifting conditions. Unfortunately, this brings many difficulties to the leaders and managers of such organizations.

The companies with divisional structure that have their departments operating from different countries of the world face the problems of cultural character when they try to enforce the innovative policies and make their foreign employees change their attitude towards the work process. The companies with diverse employees have to manage the differences of their departments carefully in order to achieve the best results and avoid misunderstandings and bigger issues.

The modern approach to job design at Nike organization is facing several challenges. First of all, today Nike is focusing on innovations and development of new projects. In order to speed up the process of product development the managers had to obtain and learn new practices of work and innovative approaches. The problem is that some of the departments do not quite comprehend the concept of innovative approach and brand development.

The managers there and the companies did not have much experience of innovating in the past, their strategy was oriented at stability and their work process did not include much development, this is why for them it was a problem to be asked to innovate. This phenomenon happens because the process of globalization and the technological progress are quite inconsistent around the world; some of the countries have a delay or are left out. This is why their attitude towards the business and its operation may be different. Besides, cultural differences play a big role in this issue.

As a result, more complicated tasks and projects were a problem for some of the departments of Nike. The demands on the core job dimensions required better professional skills and their higher variety, which means that the employees required some training in order to fulfill the company’s demands. Besides, task identity was challenged by the fact that some of the departments were not able to perform the whole range of tasks that they were asked to. Of course, this caused issues with autonomy of the workers, because the managers were no longer able to do the work the way they saw it.

The workers of such departments had to either be trained in order to be more suitable for the new demands or simply switch to more simple occupations. As a result, the company leaders have worked out a new approach that was directed at the addressing of the cultural and social differences of the employees of the foreign departments and teams. Besides, the company has made an emphasis on training the professionals and experts in factory and product development.

For that task to be fulfilled the company’s leaders needed to identify the spheres of knowledge that had to be transferred to the foreign employees and then to check if the ways of knowledge transfer worked properly and the workers developed the needed skills and were aware of their new duties. Without the system of transfer and evaluation there was not ways to find out exact issues that stopped the departments and teams from development and the measures that could be taken in order to eliminate this problem.

Moreover, the company managers were to determine the types of easier tasks for the departments from abroad and find out if the employees and the branches were able to perform these kinds of tasks. It also takes quite some time to switch the department’s function and change the ways it works. This is when Steve Trautman suggested his tree-step knowledge transfer solution (Nike Uses Knowledge Transfer to Manage Change and Increase Innovation in Offshore Teams 2012).

Reference List

(n. d.). University of Washington.

(2010). Studymode.

Nike Uses Knowledge Transfer to Manage Change and Increase Innovation in Offshore Teams (2012). Stevetrautman.

Qaintance, J. (2013). .

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