The success of any business is built from an effective decision-making process. Decisions impact the way customers and the community view the business which may influence them in the long run. To achieve a conducive business environment, a company must employ business ethics to guide every stakeholder in daily operations. A competitive business should impact the community and global environment positively by conducting operations with ethics and following regulatory issues. This essay uses Nike company to explore how decision-making impacts the business both locally and at the global level. Therefore, a business should follow a relevant decision-making process to create a positive business environment and gain a competitive advantage.
Decision Making
Decisions
There are several business decisions that Nike needs to make based on business ethics and regulatory issues. The first is about the design of Nike’s shoes and other products. The business ethic behind this decision is standards and quality. The company should design the product in a way that aligns with its goal of quality footwear. The second decision is about the location of the company. The location decision determines equality in terms of employee recruitment and market for a company (Xu, 2018) . The company should locate where regulation such as inspection and tax collection is easy to make. Another decision is on maintenance of the company. Through continuous recruitment, Nike will uphold the ethic of responsibility. Recruitment supports the human resource needs thereby ensuring maintenance. In addition, inventory management decisions need to be made. The objective of this decision is to uphold reputation both within and outside the company. The decision involves constant monitoring of inventory from the manufacturing to retailers and distributors.
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Making the above decisions will take few procedures. First, the decision needs to be identified. This step is important since the company will try to define clearly the nature of the decision and how it may affect the daily operations. From then, the company will gather relevant information which may influence the decision-making process. Information for a company like Nike should be obtained both internally and externally from employees, suppliers, distributors, and customers. Possible alternatives should also be considered when collecting information. From then, the company’s decision-makers should weigh the evidence to consider the best between a proposed decision and its alternative. The next step is to take action by implementing the decision made. Lastly is to consider the consequences of the decision by reviewing it.
Culture
The design of footwear products will improve business performance. Transforming manufacturing by improving product innovation repositions the supply chain in a way that ensures strategic growth. Besides, location determines the environmental impact of business sustainability initiatives. Also, location decision impacts the environment and Nike should recycle some of the material used in manufacturing as a way of ensuring corporate citizenship.
Decisions such as continuous recruitment will reduce philanthropic work. Nike will use more money in the recruitment process leaving little or no budget for philanthropy. Through inventory management decisions, Nike will be able to engage with the community in the consumer side of the supply chain. As a result, the company may engage in mentorship programs, leadership development, education, coaching, and other initiatives for the community.
All the above decisions will translate into an increase in Nike’s activities. However, such activities have negative impacts on the environment. Leather is not only hard to decompose but its manufacturing process involves carbon emission which leads to negative consequences on the environment. In addition, an increase in Nike’s activities will lead to the recruitment of casual support workers. These workers will provide training and skills to other recruits which ensure continuous productivity for the company.
Stakeholders
The design of Nike shoes will affect stakeholders such as customers as it makes the brand credible and memorable. The design will set customer expectations and build Nike’s reputation among the customers. It also enhances Nike’s product by making customer interaction engaging, seamless, and user-friendly. The location decision will also affect the customers. Consumers tend to purchase products near them since they are delivered faster (Ansari, & Riasi, 2019) . The community being a major stakeholder will be affected both positively and negatively by the location choice of the company. When Nike is closer to the community, it engages in development projects within the community. On the contrary, Nike’s manufacturing facility can have environmental consequences to the community. Environmental pollution due to carbon emissions will negatively affect the community.
Suppliers who are also the company’s stakeholders are affected by both location and inventory management. Nike which engages in competitive business will need reliable suppliers to make spending plans in advance. In terms of location decisions, Nike will sign a contract with suppliers who are located near the company’s premises. Employees are also stakeholders who will be affected by maintenance decisions that include recruitment. Treatment of employees may either build or destroy the reputation of the company which may affect the recruitment process. Potential recruits will base their decision on how the company treats current employees. The last stakeholder group is owners, and they will be affected by the decision-making process. They should not only make the decisions based on the interest of the company but also considering other stakeholders. The best alternative in the decision process should affect the majority of the stakeholders positively.
Impact
Community
Business ethics can pass from business to customers in the supply chain. The ethical manner of conducting business such as morals, values, and beliefs can be passed from employees to customers (Blok, 2017) . The effect will be seen and felt throughout the community which impacts community centers and local schools. Some of the business ethics upheld by Nike such as effective communication outlines acceptable behavior that may not be within government control. Such ethics promote integrity across all stakeholders, and customers can trust the company. In the long run, trust will not only develop between the business and customers but with individual members of the community. Loyalty between employees and management of the company will be passed to the community through constant engagement and interaction. Loyalty will lead to positive cooperation between members of the community.
On the other hand, regulatory issues such as minimum wage and joint employment may affect Nike which can negatively impact the community. The company may be forced to comply with lots of regulations that involve huge sums of money thereby reducing its spending ability on the community. First, the company will be forced to delay planned projects which affect the community members who are depending on the project. Also, regulation will force the company to delay recruitment which reduces employment opportunities in the community. Some regulations may require the company to be located far away from the people due to the effects of environmental pollution. As a result, community members will have to incur traveling costs to and from the workplace. Huge taxes imposed by the government will force the company to increase the price of Nike shoes. Therefore, the community members will bear the burden of the price increase.
Global Environment
Business ethics will impact three areas of the global business environment: ethics and management practices, ethics and corruption, and corporate social responsibility. Business ethics will impact numerous aspects of operations and management practices such as marketing, human resources, corporate mission, research, and development. However, the role of business ethics differs from one culture to another, especially in human resources and employment. The relationship between the company and employees will also be impacted by the local culture. In the case of ethics and corruption, the norms differ from one region to another. In some regions, giving a gift is considered bribery and a form of corruption. The success of a business on a global level is attributed to good management practices and low levels of corruption.
The third impact is corporate social responsibility. Business ethics will impact the way companies around the world seek to establish goodwill with stakeholders including customers and employees. As a result, companies will be concerned about environmental, economic, and social issues in the workplace, community, or even the supply chain. Due to business ethics, companies will be promoting friendly and greener initiatives as part of environmental conservation. Besides, business ethics will influence companies to support nonprofit organizations and other causes for the prosperity of the region.
On the other hand, regulatory issues will impact the global business environment through impositions of barriers such as tariffs. The imposition of tariffs will discourage free trade and foreign firms will find it hard to start a business in a particular country. Trade sanctions will also negatively affect the global business environment as countries with penalties may impose trade restrictions and tougher regulations limiting a foreign company’s ability to conduct the business operation.
In conclusion, decision-making is a critical aspect for any business as decisions impact employees, the community, and the global business environment. Following the relevant process and procedure in formulating decisions plays a huge role in the success of the decision itself. Nike’s step-by-step process in decision-making has seen the company implement some of the most successful innovations in the shoe-making industry. The company’s constant engagement with the communities has earned Nike a reputation all over the world. Through philanthropic work, the company can retain loyal customers and attract potential customers. Stakeholders from the owners to the distributors ensure that customers receive their orders on time and address their suggestions or recommendations. Therefore, companies should emulate Nike’s decision-making if they want to make a positive impact in both the local and global business environment.
References
Ansari, A., & Riasi, A. (2019). Using decision trees to analyse the customers' shopping location preferences. International Journal of Business Excellence , 18 (2), 174-202.
Blok, V. (2017). Levinasian ethics in business. Encyclopedia of business and professional ethics , 1-5.
Xu, W., Liu, L., Zhang, Q., & Liu, P. (2018). Location decision-making of equipment manufacturing enterprise under dual-channel purchase and sale mode. Complexity , 2018 .
