Nike Inc. Case Study

There are Cats and Dogs , Coffee and Tea and then there are Nike and Adidas. It is no twist in the story that they are arch rivals. But what is the Plot? Nike and Adidas seemed to have a good and almost equal market initially in the ‘00s. Adidas then dropped the mic with its super popular Y-3 label and signed David Beckham for a lifetime $160m deal while Nike went shopping and came back with Hurley, Converse and Starter for an estimate of $450m. While backstage Current CEO Herbert Hainer took over in 2001 and Nike Co—founder Phil Knight stepped down from CEO a year later. Meanwhile Michael Jordan hung up his sneakers in 2003.

In conclusion, both works are similar and different in their own ways, like how they differ in their religions, like how the Vladimir Virgin is based off a monotheistic region, how mother Mary is shown in the artwork showing compassion and love for baby Jesus as of known to the fact that he will die when he is older. She hugs him tight as if not letting go but having the face of despair, because she knows that she can’t do anything to stop what’s going to happen in his future. Nike alighting a Warship is different because this piece is based of a polytheistic religion, and how the piece’s details are flowing and showing her covered body that is also revealing. Because it is draped to her body as if the waves splashing against the ship are also

The operating income of the investment, as well as cash flows, may not be enough to prove its feasibility. The average return on capital percentage may be considered as a low percentage and it can be linked to the dropping stock price as a reflection of stockholders’ confidence in the company. However, the project for expansion is feasible and profitable, based on the data supplied. The

Nike Inc. is a multinational athletic sportswear corporation that produces a wide range of both men’s and women’s footwear, clothing, equipment and accessories. It is also globally the largest seller of such garments, selling to approximately 19,000 retailers in the USA, as well as in 140 other countries around the world. Of course with such territory Nike has become a huge target to a broad range of campaigning non-governmental organizations and journalists as significant representation of business in society. In Nike’s case, like most big manufacturing companies, their biggest social issues involve human rights and conditions for workers in factories in developing countries. Other issues that Nike seems to face include their transition towards becoming a more sustainable company as well as providing top and long-lasting quality products for their customers.

Nike is one of the largest, most popular brands in the world. It is a business that is continuing to grow while it is already making billions yearly. By moving to developing countries and emerging countries, Nike gets cheap labor and low facility cost. As a result, they set their product prices lower than the competition to attract more customers. Nike’s allegation of poor working conditions and child labor has become a global issue and it affected the stocks dramatically. Nike’s image has been permanently damaged. Running a company as big as Nike, and other major companies like Reebok, and Nestle is not an easy task.

Based on the Total Rewards Framework, “A Simplified Model Based On Industry Practice”, Nike and its contract manufactures have a poor total rewards management for compensation, base pay for its contract manufacturers factories’ workers as their wages are below the minimum wages. It is evident on Nike’s internal report, their contract manufacturers exploit their factories workers through long working hours and paying lower than minimum wages(WSWS, 2011). This caused the public to view Nike as a company with poor total rewards management. Furthermore, one of its contract manufacturers at Bangalore, India, did not raise the minimum salary for its workers after a government-mandated increase.(WallStreet, 2014)

In July 2001, NorthPoint Group, a mutual-fund management firm, sought to buy Nike shares for $42.09 per share. Kimi Ford, the portfolio manager, was in a dilemma as some analysts such as Lehman Brothers recommended a strong buy, while others such as USB Warburg and CSFB were against a buy. Kimi decided to find out for herself by developing her own discounted cash flows. She found that Nike at a price of $42.09 is overvalued at a 12% discount rate, but a quick sensitivity analysis revealed that Nike was undervalued at a discount rate below 11.7%. She then had her assistant, Joanna Cohen, calculate the cost of equity. The central issues addressed are:

By adopting unethical practices (e.g. false advertisement, worker exploitation, child labour etc.), firms risk their reputation and could lose consumer confidence, ultimately leading to decreased sales and in some cases, boycotts. Beder (2002) reported that Nike has lost significant shares in 1997 after being exposed of utilising ‘sweatshops’ —subpar/ inhumane working environments— and child labour. Under heavy criticism and suffering from diminished sales, Nike was forced to reevaluate its approach and rebuild its reputation by actively seeking endorsement from non-governmental organisations (e.g. the Fair Labor Association) and rectifying their mistakes (Beder, 2002). It is obvious that Nike fared a long way since the scandal as it is now one of the most prominent sportswear brand. This underscores the relevance business reputation— that it is a necessary component, which enables businesses to increase profits. Nevertheless, per UNICEF (2016), child labour remained pervasive in society; it is estimated that there are 150 million children engaging in labour, where one in four child-workers (from the poorest countries) are exposed to hazardous jobs. This fuels arguments that accuse businesses involved in foreign markets for encouraging child labour, challenging the reputations of firms. Moreover, it has been suggested that involvement in the process of globalisation and foreign markets does not guarantee success for businesses. Werhane (2012) found that quite often, there is

The same factors that enabled NIKE to grow at a surprising rate over the last several decades were also sources of serious problems for the company. NIKE was criticized for outsourcing in countries where low wages, poor working conditions, and violation of human rights were prevalent. Low level of public relations that NIKE has maintained tarnished its image. Abuses of its suppliers for example low wages in Indonesia, child labor in Pakistan, health and safety problems in Vietnam, and so on were also created major problems on the company.

Every box of Nike shoes states, "engineered and built to the exact specifications for championship athletes around the world." Nike has become the measuring stick in the world of merchandising and endorsing. Top athletes around the world are often seen with a famous Nike swoosh on their shoes. It is not uncommon to see some form of Nike product everywhere you look.

NIKE, Inc. is the world’s leading innovator in athletic footwear, apparel, equipment and accessories. Before there was the Swoosh, before there was Nike, there were two visionary men who pioneered a revolution in athletic footwear that redefined the industry.

The officials at Nike totally ignored the faulty implementation made by them and they were blaming i2 software for the failure and Meetings were not directed by the officials to survey the problems arising or preventive activities.

Operations management is the art of knowledge that ensures that services and goods are produced and distributed successfully to customers. Operations management key objective is maximize efficiency while producing and effectively fulfilling customer needs. In this novel the operations management team is struggling to make this plant a profitable plant so it will not be shut down. Alex is wondering why is that he cannot produce quality products and respond to customer needs at a faster pace considerably on time and better than competition cost. Any actions taken place towards the goal itself is considered productive and anything reverse of that situation is not considered productive at all. There are multiple operations management concepts that will be introduced here to lead to a successfully ran plant such as operation strategies itself, product design and process selection, quality management, just in time and lean systems, capacity planning and facility layout and inventory.

The case concerning the Nike brand is a classic case of maintaining and working on brand image. Every aspect of a brand is important in the basis of building a strong clientele and becoming a trusted retailer. Nike endured challenges along the way in their quest to become umber one. They encountered criticism due to the unsafe working conditions, which took the life of one of their workers in a foreign land. Although they were not direct workers of the Nike's headquarters, they were a part of the making of the brand's products through subcontractors. This connection alone should have made Nike more interested in their treatment and the perception others had of the brand.

Nike’s sustainable business and innovation strategy is an explicit approach to rewiring the way it does business, to keep the brand on track in light of upcoming resource constraints, continuing supply chain challenges and changing consumer behavior (Salter Baxter, 2010). The main challenge Nike is facing is the ability to maintain innovation and keep up with technological advances, while continuing to build positive organizational growth.