This is to make sure that the development and innovation keep happening in all products that Nike manufactures. Adding to this, the teams within the organization might start having unhealthy competition amongst them to win over each other. Structural and strategic alignment that considers these variations reinforces Nike’s competitive advantages, especially in penetrating regional markets. First of all, the global corporate leadership. “We are fortunate to have built a strong and deep bench of talent across our organization. Content Theories: What Really Motivates Us. Nike Inc. has an organizational structure that facilitates regionalization of business strategies. How knowledge management mediates the relationship between environment and organizational structure. Geographic divisions are a major organizational structure characteristic of Nike, Inc. In a matrix structure, there are multiple reporting lines and responsibilities for the employee. The following are the main global leadership groups headed by a President, Executive Vice President, or Chief Officer: Semi-Autonomous Geographic Divisions. According to Flatworld Knowledge, Nike is a model of a successful company that uses this structure effectively. The structure attempts to meet the demands of the company globally and regionally. In the Nike brand, teams work across footwear, apparel and equipment product engines. Despite changes in the market environments, Nike has stuck to its decentralized and networked organization structure. This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. People have specialization and perfect skill sets and their placement is with similar people in a group. Moreover, lack of coordination, which is highly likely, can prove to be fatal for the organization. Consequently, the firm’s tactic of employing creative and innovative ways to market their products is commendable. The Comm… (2015). On the other hand, it follows a divisional structure on the product basis. Corporate structure, ownership and the likelihood of innovation. 4. 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. As such, Nike Inc. has developed its organizational structure to enable adjustments in dealing with market differences. First, when a single person is working on more than one jobs, he is answerable to more than one bosses. Secondly, the divisional structure leads to a duplication of duties within the firm. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. Development and return on execution of product innovation capabilities: The role of organizational structure. Concepts from Chapter 15 and the organizational structure of the organization. Through this feature of Nike’s organizational structure, decisions are easily implemented throughout the company. 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. Other divisions within Nike organizational structure are the subsidiaries’ and Nike licensing divisions. The NIKE environment is a collaborative, matrix organization, where team members often report into two areas, such as a geography and a global function. 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. For GDPR compliance, we do not use personally identifiable information to serve ads in the EU and the EEA. 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. The product design is done specifically for their needs. The research plan may face postponement due to low funds. 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. Menguc, B., & Auh, S. (2010). Nike’s revenue from the Running category has grown by 7% from 2017 to 2018 (5% on a currency-neutral basis). 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. 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. By continuing your navigation, you consent to their use. Nike's Organizational Culture- Rodisel 1. A major part of Nike’s success is due to Nike’s organizational structure. Nike employees report directly to a product teams. 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. The company’s operations are divided into segments based on regional markets. It is basically in the name, the organizational structure of Nike has global corporate leadership which involves corporate managers. This flexibility is especially notable in how the company markets its products through company-owned NikeTown stores. The unnecessary grudges and conflicts arising from this can be detrimental for the firm as well as the employees. They decide for the global corporate structure of Nike. Nike is a powerful example of corporate culture because Parker is serious about reinvigorating his organization on a regular basis. A divisional structure is characterized by internally grouped products, projects, or product markets. The managers have offices in the company’s headquarters in Oregon, USA. Each business center of the company focuses on their operation like research, marketing, or production. He joined Nike in 1999 and held leadership positions in EMEA and North America before taking on responsibility for global communications. Creately diagrams can be exported and added to Word, PPT … Nike aims to be a brand with purpose that moves the world forward. The company has subcontracted its most crucial operation, which is manufacturing itself. Conceptual Provisions of Formation of the Quality Management System Within the Integrated Corporate Structure. In Nike’s case, the corporate structure highlights the need to address differences among regional markets. However, a disadvantage of Nike’s organizational structure is the limited approach to managing the operations of Converse. 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. 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). Office of the President & CEO, Nike, Inc. Liao, C., Chuang, S. H., & To, P. L. (2011). Nike Organizational Structure Chart Nike, Inc. President and CEO (John J. On the other hand, the Nike licensing division, as its name suggests, controls the licensing of the Nike brand name. All the departments of a functional structure come under the president. At NIKE, we excel as a team. This structure is based on the company’s needs in its global organization, as well as the uniqueness of conditions in regional markets. Over the year, Nike implements efficient innovation management structure that assists the company to … In a matrix structure, the authority passes vertically as well as horizontally. Nike follows geographical divisional structure to facilitate customers in different areas. The Matrix Structure and Nike … Nike’s organizational structure is worthy of study due to the fact that it has been a successful organization since its inception. We’re a strategy, business & marketing resource. Enter your email address below to subscribe to my newsletter. 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. But there is a limitation to that autonomy. Nike Inc.’s organizational structure reflects the abilities and limits of the business in its operations. Over the year, Nike implements efficient innovation management structure that assists the company to achieve effective innovative process. familiar with common problems and concerns in their Groups 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. Het Nike-model heeft echter specifieke voordelen voor het bedrijf en draagt bij aan de lange levensduur als leider in de schoenen- en activewear-ruimte. Tang, F., Mu, J., & MacLachlan, D. L. (2010). The Nike sportswear company is organised in a matrix organizational structure, more commonly known as a flat organizational structure. Markides, C. C., & Williamson, P. J. These managers decide for the global organizational structure of Nike. Nike is a powerful example of corporate culture because Parker is serious about reinvigorating his organization on a regular basis. This is because one department will not be aware of the plans of the other departments. First, the company seeks to foster a spirit of belonging among its employees. Moreover, there are functional departments under the Global corporate leadership, and there is also a team structure in the organization. Nike’s organizational structure is one of the best organizational structure examples in the world. Nike’s organizational structure is a matrix structure. Martin, R., Muuls, M., de Preux, L. B., & Wagner, U. J. Nike Inc.ʼs organizational structureʼs characteristics facilitate control and flexibility in the business. Key Facts & Figures Nike’s organizational structure is one of the best organizational structure examples in the world. You need to focus on the external elements that influence the brand's activities. Such regionalization promotes value chains that specifically fulfill customers’ expectations, especially in the area of service and marketing. Types of Branding: Learn more about branding and its significance. Prior to Nike, he worked at Edelman in Brussels, representing and advising clients on the WTO, EU relations, corporate reputation, issues … Employees must have the abilities to think outside the box and understand things from a local and global business perspective (Lukinate & Sondaite, 2017). The divisions according to products help the firm in developing its products as the employees in each division focus on their product only. Under this leadership comes a functional structure that divides finance, global human resources, product & merchandising, administration &legal, global sports marketing, and operations departments. Salimova, T. A., Biryukova, L. I., Makolov, V. I., & Levina, T. A. 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. An organizational structure defines task delegation, and line authority establishment within an organization. This site uses Akismet to reduce spam. This leads to confusion and conflicts, as to whose work should be given priority. An organizational structure defines task delegation, and line authority establishment within an organization. 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. 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. 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. For example, the Global Sports Marketing group releases new athletic shoe marketing campaigns for worldwide marketing. Nike’s organizational structure has global corporate leadership, which involves corporate managers. The organisational culture at Nike is reinforced in a number of ways. The matrix organizational structure of Nike accumulates advantages of all different types of organizational structures within it. NIKE, Inc. today announced management and organizational changes to drive continued growth. The managers have an office in the headquarter of Nike which is located in USA. 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 Nike has a geographic divisional organizational structure. This characteristic of the corporate structure offers control for brand licensing and the operations of Converse. “We are fortunate to have built a strong and deep bench of talent across our organization. Analysing various aspects of the brand with SWOT analysis gives the case study on Nike brand major insights about Nike organisational structure. It is the world’s largest supplier of athletic shoes and apparel. Disseminative capacity, organizational structure and knowledge transfer. View Nike's Organizational Chart.docx from ORG 535 at University of Phoenix. This leads to wastage of money and other resources of the firm. Save my name, email, and website in this browser for the next time I comment. Nike’s wholesale equivalent revenue from ‘Running’ products grew to $5.2 billion in 2018 from $4.9 billion in 2017. Nike’s network structure enables direct communication across unit and firm boundaries, which ignores the chain of command. 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. 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. Nike follows this organizational structure in the way that they group their divisions according to each sport. Nike’s organizational structure is a matrix structure. We use cookies for website functionality and to combat advertising fraud. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. The regional divisions are given autonomy in taking decisions in their regions. Training programs are designed to uphold such corporate culture that aligns with the Nike brand image for sports footwear, apparel and equipment. Each regional division’s managers optimize operations in the regional sports shoes, apparel and equipment market. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. Org chart highlighting visualizing the Nike organizational structure. Press Esc to cancel. Best Green Tea Brands in the world in 2020: What makes them the best? A close check is kept on these divisions. (Photo: Public Domain) Nike Inc. 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. 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. By continuing your navigation, you consent to their use. This means that the tasks of each functional group are done quickly. Hence, this prevents them from doing any unethical or inappropriate thing that might harm the entire firm’s image. 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. The firm has chosen, from different types of organizational structures, the one that suits them the most. familiar with common problems and concerns in their Groups Two divisions will have different departments for the same function, no matter how small the divisions are. Nike’s organizational structure also has two global divisions: one for the Converse brand and another for brand licensing. (2012). 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. This is the reason why you can find different variety of Nike products in your country in comparison to another country. Corporate diversification and organizational structure: A resource-based view. PESTLE analysis of Nike brand. The Nike environment is a two-way, matrix organization, where team members often report into two areas such as geography and a global function. Reinvigorating his organization on a currency-neutral basis ) in their Groups Concepts from Chapter 15 and the of. Expectations, especially in penetrating regional markets flat organizational structure in the area of service marketing... 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