Organizational Structure of Nike

Nike is set up as a Matrix Organizational Structure, meaning that there are multiple lines of authority and some individuals report to at least two managers.  Throughout Nike, employees report to team managers who then relay the progress report to the department manager.  Each brand consists of it's own department and has separate department managers who act independently of the CEO.

Team managers and employees make decisions regarding specification and production while department managers focus primarily on policy-related issues.  Employees are entirely responsible to both of these managers.

Globally, Nike is a very well-known brand.  This use of the Matrix Structure allows Nike to make decisions and react much more quickly than your average department head, who is often removed from that decision making process.

Overall, Nike is proof that a combination of the functional and divisional structures can be successful and produce endless possibilities in regards to short term and long term goals among an organization.

Corporate Level Strategy of Nike

The corporate level strategy of Nike is a very compelling discussion.  Diversification among the brand is obviously a major tool.  Nike products are the typical example of moderate-high, related constrained diversification.  This reveals that more than half of revenues come from major business fields.  Also, it is proof that all businesses share product, technological, and distribution linkages.  

The major product that yields the biggest share of income is shoes and apparel.  With minor products, the company uses the same distribution channels, technological, and other resources.  Their primary product focus is athletic footwear designed for specific-sport and/or leisure uses. 

Nike must pay close attention to manufacturing and supply chain diversification also.  Recent global economic crisis and uncertainties increased importance of such diversification.   This enables Nike to get the best deals and decrease risks. 

Supplier diversity is a very important part of the success a business generates.  Due to Nike’s customers being on a worldwide scale, the company must create a very broad base of suppliers in order to generate the revenues they are aiming for.  

Intellectual Capital of Nike

Nike is not exactly known for just one product they produce specifically.  Although, they have a positive reputation in the product line of their shoes.  They significantly increased their reputation by including famous athletes such as Michael Jordan and Bo Jackson.  Nike gained publicity by doing this because nearly everyone from 40 years old and younger wanted to be 'Like Mike'.  Or in Bo Jackson's commercials, his famous line was 'Bo Knows!'.  To this day, when discussing the overall view and significance of Nike, they proudly associate a great reputation to their brand.

The value of Nike as a brand is through the roof.  An example of this is: adding only a tiny swoosh or two to a piece of off-brand clothing and the price increases by $20 at least.  This shows the luxurious type of distributor Nike has become.

Overall, Nike has made tremendous strides in their intellectual capital.  They have always and will continue to be comfortably above the rest of their competition.

General Environment Factors of Nike

There are many factors that play a key role in how successful or unsuccessful a brand is.  Within the Nike brand, demographics are a main concern.  As people age, they will more than likely stop purchasing Nike apparel and move on to a more comfortable brand such as New Balance.  It is very common to see an older person wearing new balance shoes.  Also, the buying tendencies are based on how people are located geographically.  It would be extremely rare to see a farmer working on the ranch sporting anything Nike based.  Although farmers are not the target market for Nike, this does play a role in where and how often their product is purchased.

From a sociocultural standpoint, Nike goes hand in hand with the recent concern for fitness in not only America, but throughout the world.  With this concern and people starting to workout more often, their product will be purchased more often.  Also, Nike has included Hope Solo in a few of their commercials.  She is a very popular women's soccer player.  With more women in the workforce, this has a positive effect on Nike.

Nike could generate a substantial boost in profit by implementing people who are a part of the Americans with Disabilities Act into their marketing efforts. This would create a strong, caring image for the brand.

Technologically, Nike has done a good job in giving their product easy exposure.  They take part in computer-aided designing, computer-aided manufacturing systems, and have shown an emergence of internet technology.  On the Nike website, you are able to design your own shoe and purchase it in just a short time.  They allow you to choose whichever colors you please.  This easy and simple way is very favorable among consumers.

Economically, Nike must be aware of the interest rates. In order to be successful, they must make the right decision depending on the interest rates.  Also, their sales would dramatically decrease in the instance of a recession.  Nike is a brand that would suffer a great deal if there were a recession.  This is due to their luxurious image they have created throughout the years.

Globally, Nike should continue to expand their horizons internationally.  Especially in areas of greater wealth.  They have done a great job in becoming internationally known.  In order to become the best, they must keep releasing new products that consumers around the world are attracted to.