Essay: Building Trust and Respect: How Nike Became the World Leader in Athletics

Shared Value :
They want to build the relationship around trust and respect for individuals. Their mission statement reads that they want to be the world leader in the athletic industry ” A company that surpasses all others in the athletic industry ” [Source : Nike.com].
In order to achieve this feat they must work upon quality – footwear and apparel. They must also innovate to ensure they meet the ever changing needs of the customers. They must also ensure availability through their retail and online outlets.
System :
The main systems that run Nike are their Research and Development – bringing out innovative products lines and their Advertisements – reaching the core of every individual across the continents.
For, the past 5 years they have increased their total revenue by over 4 million and our profit by 2.5 million[Source : Nike.com]
Structure:
We have already discussed the hierarchical structure in the earlier part of the report. As we can see Nike has over 47,000 branches in over 100 different countries across the world and the main facility is located in Beaverton, Oregon[Source : Nike.com]. Since it is a global organisation it can easily attend to local customer problems with their local outlets. The online stores can help them in their customization business and timely delivery of orders.
Skill:
Their key strength has been promotion and advertisement. They have marketed their products – acquiring the best sportspersons, promoting and association with the athlete and lastly inpiring commercials that strum the enthusiastic chord of an individual.
Staff:
The average age of the Nike board is 62 years.[Source : nike-strategic-planning-document]. Their co-founder Philip H. Knight has been associated with the company since its inception. He is known to have a participative decision making style that allows free and innovative thinking.
Strategy:
Nike initiated as a footwear company with Air Jordan shoe line which is now one of the most loved and established brands for youngsters. This line features Michael Jordan and has brought out an image that association with Nike makes the customers linked to Jordan himself, this shows how they have been able to successfully build a brand persona. They have also expanded and become a major global conglomerate.
Style:
The management has promoted a participated lifestyle with research and innovation as the key parameters. They have also promoted stewardship that helps in enhancing the competitive spirit. Thus promoting team building which can be witnessed from their lower attrition rate [2-3 % over the last five years- Source : Nike.com].
Nike’s Unique Value Proposition
Nike value proposition has been on the innovative design and quality. Innovation has been a key feature and has now become the mantra of the company. Value is the experience and benefit that the stakeholders receive from a company. Consumers seek value form the product, Investors seek value from the financials and employees seek value from the benefits and salaries.
Nike has extensively practiced ‘Form follows Value’.
Nike has three critical resources that helps the company in creating the value.
‘ Design and R&D ‘ to create the new products
‘ Marketing- to create, drive and sustain the demand.
‘ Distribution- to enable it transport its newly manufactured products to the retail stores in a quick means.
Also Nike has outsourced almost all of its products’ manufacturing which are produced on a contractual basis. Even though manufacturing is a critical part of a company delivering value to the customers, Nike has been able to restrict its value creating base to the three aforementioned resources, thereby cutting costs, achieving high efficiency in its operations on such a large scale and maintain its focus on critical customer value areas. Nike has excelled in achieving maximum profitable growth, high productivity and quick response to ever changing consumer preferences and tastes.