II. Trends
Business Environment
Nike is affected by a variety of internal and external factors in its environment, which not only affect its operations but also have an impact on management function. The external factors include the political environment, the changes in the economic environment, differences in cultures, and advancements in technology. Within the political environment, Nike has to deal with the difference in political climates across different markets. While some climates are determined by market stability, other political climates are defined as unstable markets. This instability has an adverse influence on the revenue and profitability of Nike offices within these markets (Matovic et al., 2019). However, the expansion in free trade policies acts as an opportunity for the firm to grow in some markets. Another factor is the change in the economic environment. Changes in the rate of inflation and interest rates have an impact on the operational growth of particular economic climates. The rapid growth of developing markets also presents a substantial competitive threat to Nike.
The difference in cultures across different countries is also a factor within Nike's business environment. The company is expected to develop products and utilize market campaigns that are aligned with the cultural beliefs of different markets. Nike should also engage in the development of new products that address products for the increasing leisure needs of varying consumers (Alazzawi, 2019). The last external factor is the significant advancements in technology which influence the level of competition that the firm has to face. The increased investment in R&D departments within firms threatens Nike. This is a threatening factor as the company is focused on developing more advanced sport shoes and apparel. Besides, technological obsolescence is a threat to Nike as it places pressure on it to enhance its efforts in the development of products.
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Some of the internal factors include strong brand awareness, a substantial customer base, in-house professionals, superior marketing capabilities, innovative products, and efficient integration. Nike has strong brand awareness as it is one of the most recognizable brands across the world. The firm has a name that can be easily pronounced and one that is unique. The firm also has a substantial customer base as over the years, and it has been able to gain millions of customers from across the world. This customer base has been established as being loyal to the brand, following its trends, and even providing the feedback that the firm requires to enhance its services and products (Herbert, 2020). Nike has an extensive team of in-house professionals that manage and direct its operations. The brand has a team of professionals that are engaged in the design of its shoes and athletic accessories. Due to the research that is carried out, Nike has gained the capability of structuring products that cater to the needs of the consumers.
Nike has been found to have challenges in establishing a safe working environment. Former female employees have made cases of sexual harassment and misconduct. Over the years, it has been established that Nike does have a toxic working environment with a large number of cases concerned with sexual misconduct. Nike has well-developed marketing capabilities. The brand is heavily reliant on generating demand and has been able to successfully use social media and marketing campaigns to gain more customers (Matovic et al., 2019). Nike has been found to have innovative products. While the firm has produced a range of products, there are still various levels of innovation that it can explore. Nike has advanced its reach in technology concerning fitness and health through the production of wearable technology and athletic wear. The last internal factor is that Nike carries out the efficient integration of its operations. Its supply and production operations are dependent on independent manufacturers. The brand has the ability to increase its efficiency and streamlining its supply chain.
Description
Over the years, Nike has faced different controversies associated with child labor and ethics within its supply chain. While the firm has substantially invested in CSR to mitigate these issues, there are still trends that Nike has to face. One of the trends includes increased investment in social and environmental initiatives by different firms. Many competitors and firms have elevated their focus on establishing social and environmental initiatives. Another trend is that there has been an increased call for various organizations and firms to decrease their environmental impact. This reduction in environmental impact includes a reduction in carbon footprint and any other adverse effects that the firm's operations may have on the surrounding environment (Alazzawi, 2019). Another trend that may also influence Nike is the investment in sustainable innovation.
The last trend is the creation of a culture of diversity and inclusion across the organization. Many organizations have been called to enhancing the level of diversity and inclusion within their workforce. This not only ensures that the level of discrimination associated with different cultures is mitigated but also promotes the level of creativity and innovation across different organizations.
Impact
The existing trends on CSR, sustainability, and business ethics may influence Nike in a variety of ways. While the firm is identified for its advanced products and premium marketing and advertising strategies, it also requires to invest in these ethics. Nike will need to increase its investment in social and environmental initiatives that influence the communities affected by its operations. This will involve the identification of these opportunities along with compliance with different laws. Nike will also need to enhance the safety and quality of its work environment. This enhancement will be centered on the working conditions within its supply chain. Nike will also have to ensure that its workforce is diverse and inclusive by ensuring that the workforce is recruited from different environments. The firm will need to improve sustainable innovation by investing in products structured from sustainable raw materials. This level of sustainability can enhance the influence of the firm in the shoe industry and assist in controlling operational costs and strengthening its bottom line.
III. Ethics
Issues
Nike operations establish ethics as the highest priority to ensure the effectiveness of activities. The firm's code of conduct is a significant aspect of its sourcing strategy, factory audits, and the methods of determining which factories the company will continue to invest in and grow for the creation of a green and empowered supply chain. One of the issues is the influence of regulations and rules in different countries across the world on the expansion of the firm. Some nations across the world have highly structured regulation frameworks which restrict some operations conducted by Nike. Therefore, while expanding its presence in different nations, Nike will have to focus on ensuring that there is compliance with each law and regulation. The development of the brand will also be dependent on the different cultures of potential customers. Through the existence of the internet as a platform for communication, an understanding of these cultures can be facilitated along with an integration of the opinions and beliefs of different consumers (Matovic et al., 2019). The shipping activities and operations conducted by the firm, as enabled by e-commerce, will be dependent on the import and export laws. Nike also has to make considerations of the rights of employees at the different factories that belong to Nike along with its supplier network. Nike as to focus on establishing better compliance to the rights of employees along with creating safe environments.
Alignment
The future development of the brand and decision-making support system will be based on the goals that have been outlined in the company's corporate strategy. The company aims to design products that can attract and meet a wide range of the segments of the world market based on its corporate mandate. Besides, the company’s vision focuses on establishing and maintaining the rank of the company as a top brand globally. The company’s products are one of its major strengths, which shows that the vision has already been attained since Nike is among the best brands globally. Sustainability and environmental concerns will also be used as a driver for future developments to minimize the carbon footprint of the firms (Herbert, 2020). Nike will also engage in partnerships with different firms to not only support its operations while also creating a platform that enables it to fulfill its ethical responsibilities.
Sustainability
Aligning the company’s corporate strategy, decision making, and brand development will increase the awareness of its brands and the level of loyalty that the market showcases. As the actions of the brands will focus on enhancing the level of value that the surrounding community, then the quality of products and services provided will also be enhanced. Therefore, brand loyalty will be enhanced while increasing the profit maximization of the firm (Alazzawi, 2019). This alignment will also elevate the responsiveness of the firm's operations to the surrounding market. The management of Nike uses the information obtained from the community to make better decisions concerning issues such as investments in marketing and research. Lastly, the combined alignment of these elements will establish the competitive position in its industry while increasing the revenue that the brand receives.
References
Alazzawi, A. A. (2019). Brand personality dimensions of Nike sportswear-an empirical analysis. Journal of Business and Retail Management Research , 13 (4), 13-19.
Herbert, N. (2020). "Woke-Washing" a brand: An analysis of socially progressive marketing by Nike on Twitter and the user response to it [Doctoral dissertation]. http://uu.diva-portal.org/smash/get/diva2:1438652/FULLTEXT01.pdf
Matović, V., Stanić, M., & Drinić, I. (2019). Impact branding on consumer preference towards buying a certain product: Comparative analysis of brands Nike and Adidas. Ekonomika , 65 (3), 35-44.
