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According to Flatworld Knowledge, Nike is a model of a successful company that uses this structure effectively. The global corporate leadership at Nike which involves corporate leaders makes sure to implement policies throughout the company that is, in all divisions. This worldwide company operates in an extremely different organizational structure than other companies, such as Reebok and Adidas. It is important to understand that each of these subsidiary brands appeal and cater to different groups of customers. But there is a limitation to that autonomy. Other brands that Nike owns are Bauer, Hurley, and Exeter which also have the same structural characteristics as Converse. Learn how your comment data is processed. Nike’s all-time popular slogan, “Just Do It,” is also featured in our best slogans list. 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. 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. Established in 1964, the company has now become one of leading sports shoes, apparel and equipment brand in the world. 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. The complex matrix organizational structure of Nike has worked out as expected for the company, but it does not necessarily mean that it would be good fit for another company. This structure is based on the company’s needs in its global organization, as well as the uniqueness of conditions in regional markets. Content Theories: What Really Motivates Us. The matrix structure of Nike also accumulates the disadvantages of all different types of organizational structures in it. All Right Reserved. The research plan may face postponement due to low funds. Needless to say, that the entire organizational structure of Nike encompassing every reporting authority in every market location, is extremely complicated. Therefore, each of them will have to follow their own product development and marketing communication strategies. Nike possesses a geographic divisional organisational structure. By creating sub-regions can help in streamlining the operations of the company. The company puts many targets that need team work; conclude that Nike has task culture. It is important for you to understand that different companies have different organizational structure, which is responsible for respective growth and sustenance. 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). Adding to this, the teams within the organization might start having unhealthy competition amongst them to win over each other. This not only increases their incomes but also motivates them to do even better. Employees report to a product (business unit) team which is led by the project manager and … The geographic regions in the EMEA are segregated into subregions for better management and control. There is no manufacturing of standard products for the entire world’s population. Nike’s organizational structure is worthy of study due to the fact that it has been a successful organization since its inception. Nike’s organizational structure is one of the best organizational structure examples in the world. The employees have two reporting authorities, one from the functional department and the other from the product category. Nike follows a matrix organizational structure which is a combination of horizontal and vertical structures. It allows the company to develop a brand image which is universally identical in all target markets, thereby creating a globalized brand. Moreover, lack of coordination, which is highly likely, can prove to be fatal for the organization. Many organizations experiment with the structure of the company. Secondly, the divisional structure leads to a duplication of duties within the firm. Nike: The Organizational Structure Of Nike 1033 Words | 5 Pages. The diagram shown above clearly highlights the multiple reporting lines in the matrix organizational structure of Nike. At present, the brand of Nike is valued at USD 32 billion, with the largest market share in the global apparel sector. 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. The company follows a highly standardized operational process, which helps the leaders to make quick decision and foster seamless communication. However, Nike’s performance figures (see appendix) seem to tell a different story. Nike own several wholly-owned subsidiary brands such as Cole Haan, Converse, Hurley, Umbro, etc. The local requirements of the individual markets in a sub-region is reported by the sub-regional manager to the EMEA regional headquarter in the Netherland. The company also owns subsidiaries like Hurley International, Brand Jordan and Converse. 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. This is to make sure that the development and innovation keep happening in all products that Nike manufactures. Despite the problems, the firm has been thriving over the years and has no plans of going down anytime soon. Save my name, email, and website in this browser for the next time I comment. These subsidiaries operate with certain degree of autonomy, which clearly mentioned boundaries. Nike follows geographical divisional structure to facilitate customers in different areas. Training programs are designed to uphold such corporate culture that aligns with the Nike brand image for sports footwear, apparel and equipment. As a large, international organization with thousand of employees, oddly has organic elements by giving opportunity to employees to express their thoughts and opinion as explain above. However, it should be noted that the what makes it beneficial for the company is the streamlined approach to running the business operations. In a matrix structure, there are multiple reporting lines and responsibilities for the employee. A close check is kept on these divisions. The diagram shown above highlights the structure of Nike in terms of geographic distribution in different regions in the EMEA. While this organizational structure allows Nike to respond to local consumer tastes it also ensures that the company benefits from integration advantages such as global marketing and sourcing. A matrix structure is best suitable for Nike. Whenever you are struggling with your assignments and thinking where can I get my paper writer, just talk to us. Moreover, it also reduces the reporting lines, which leads to better coordination and enhances decision making. The company realizes that even though it operates with a global brand image, some of the marketing communications need to be adjusted for cultural differences. The independence of decision making and operational autonomy allows these subsidiaries to function free from the strict control of the global and regional headquarters. These subsidiaries take most of the decisions themselves, with authorization from the headquarters. Global Milk brands in 2020 – What makes them successful? The Converse is another footwear brand that Nike owns and management in its division controls its operations. The global headquarters is the top of the hierarchical ladder, where all the major decisions about the company’s business operations are taken. It should be noted that the apparel design takes place locally, but the footwear design takes place at the global headquarters in Oregon. From visiting public places to getting famous sports stars in their advertisements and holding shows with those sports stars to gain people’s attention. May 18, 2018 - Org chart highlighting visualizing the Nike organizational structure. 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. This leads to wastage of money and other resources of the firm. Nike can be considered as a truly global brand which has been able to climb to the top position while facing steep competition from other market players like Adidas, Under Armour and Puma. (Photo: Public Domain) Nike Inc. We cover stories to empower you with the knowledge, tools & advice to help you thrive in life and business. However, in terms of localization of the marketing strategies, the regional or sub-regional intervention is present. In a matrix structure, there are multiple reporting lines and responsibilities for the employee. Strengths of Nike's Innovation Management Structure Over the year, Nike has been able to achieve a superior performances using matrix innovative management structure. Adding to this, the functional structure helps in enhancing the best form the workforce. Even though there are multiple reporting authorities, the employees are well-aware of what is expected from them from their supervisors. Nike is a well-established sportswear company, headquartered in Oregon, US. Two divisions will have different departments for the same function, no matter how small the divisions are. There will be a combination of vertical and horizontal reporting. The matrix organizational structure of Nike accumulates advantages of all different types of organizational structures within it. It also enables the firm to establish an organizational culture which is universally accepted in the firm. On the other hand, it follows a divisional structure on the product basis. Types of Branding: Learn more about branding and its significance. Nike operates in nearly 170 countries with more than 75,000 employees, selling its products under a dozen of its own brands such as Air Jordan, Nike+, Nike Pro, Nike Golf, Air Force 1, among several others. The matrix structure cancels out the extremes of the two structures to balance them somewhere in between. In a matrix structure, the authority passes vertically as well as horizontally. Best Green Tea Brands in the world in 2020: What makes them the best? Matrix structure combines both functional and divisional structures. In the Nike brand, teams work across footwear, apparel and equipment product engines. It is the world’s largest supplier of athletic shoes and apparel. Employees often report to multiple supervisors, which can often get cumbersome in this type of organizational structures but for Nike this has worked in favor of the company. Moreover, there are functional departments under the Global corporate leadership, and there is also a team structure in the organization. On the other hand, the Nike licensing division, as its name suggests, controls the licensing of the Nike brand name. Over the decades, the company has expanded its business through diversification into various international markets and by extending its brand portfolio. Its Advantages and Disadvantages, Adaptation Level Phenomenon – understanding its importance, Risk Matrix – Factors of a risk matrix and how to implement it, Prioritization Matrix – Different types and how to use a prioritization matrix, Advantages of Nike’s Organizational Structure, Disadvantages of Nike’s Organizational Structure. It also oversees all regional operations, expect the EMEA, which is managed by the regional headquarter in Europe. Apr 16, 2019 - Nike’s organizational structure is worthy of study due to the fact that it has been a successful organization since its inception. The operations of the company are also segregated in terms of distribution channel (Wholesale and Nike Direct) and product category (Footwear, Apparel and Equipment). Each sub-region is overseen by a sub-regional manager. It also makes it efficient for the company to filter the local demand trends based on the sub-regions. The combination of standardization and localization has enabled the company to adopt marketing strategies which can seamlessly appeal to the local customers, while retaining the global Nike culture, which has helped the firm to bring itself closer to its customers. Hence, this prevents them from doing any unethical or inappropriate thing that might harm the entire firm’s image. The Nike sportswear company is organised in a matrix organizational structure, more commonly known as a flat organizational structure. Nike is known for a complex organizational structure that it describes as a matrix. The centralized decision-making structure of Nike helps the firm to streamline its information processing and focus on areas which matter the most. 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. The entire global business of Nike is segregated into key geographic regions such as North America, EMEA (Europe, Middle East and Africa), Greater China, and APLA (Asia Pacific and Latin America). Moreover, setting regional divisions at different places helps in promotion too. 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. In this article, we have showcased the organization structure of Nike, which can be used as a case study for your college essay. Learning about the hierarchical structure of Nike can be quite helpful for writing papers on the company and it will also give you a clear idea on how the company manages its own operations.Let us look at each of the hierarchical levels of the company. The Organizational Structure of Nike Nike is the number one innovator in the world in athletic footwear, apparel, equipment, and accessories. The matrix organizational structure is also followed at the sub-regional level. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. It allows the company to prioritize its goals, as having the right structure leads to the right flow of information. This allows them to become specialists in their particular field, makes them best for the job. A matrix structure is made up of different types of organizational structures. Nike characterizes its organization as a collaborative matrix organization 0.02 3 0.06 3. Org chart highlighting visualizing the Nike organizational structure. Specify the page count, deadline, academic level and other variable to quickly find out the cost of your essay. Penmypaper.com. Creative organizational chart examples and templates. First, the regional divisional structure allows Nike to provide different goods in different regions in relation to the preferences of people in those regions. The Matrix Structure and Nike. At Penmypaper, we work with some of the top academic writers, with 7+ years of professional experience in their respective domain, to offer you the best assistance that you can get. Under this leadership comes a functional structure that divides finance, global human resources, product & merchandising, administration &legal, global sports marketing, and operations departments. The diagram above showcases the key individuals in operating in the global headquarters and are responsible for taking all the centralized decisions of the company. Enter your email address below to subscribe to my newsletter. Nike Inc.ʼs organizational structureʼs characteristics facilitate control and flexibility in the business. Nike came up with an organizational structure so as to aid in regionalizing of business strategy. Determine whether a matrix structure could improve performance for Nike. Why Brand Architecture is Fundamental to Building Power Brands? The firm gets to know about the culture of people living there and it markets its products according to their culture’s liking. Nike is a powerful example of corporate culture because Parker is serious about reinvigorating his organization on a regular basis. This leads to confusion and conflicts, as to whose work should be given priority. 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. The regional headquarters situated in the Netherlands, oversees the business operations in the EMEA region, which comprises of 27 nations. Over the year, Nike implements efficient innovation management structure that assists the company to achieve effective innovative process. Moreover, it can also help you to understand how a multi-nationally diverse company like Nike is structured. This strategy provides Nike suppleness for attending consumer's different preferences on sports attires in different markets at different regions of the world (Burgelman, 2016). The unnecessary grudges and conflicts arising from this can be detrimental for the firm as well as the employees. familiar with common problems and concerns in their Groups Type above and press Enter to search. Ans. An organizational structure defines task delegation, and line authority establishment within an organization. This site uses Akismet to reduce spam. 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. People have specialization and perfect skill sets and their placement is with similar people in a group. Nike follows a matrix organizational structure which is a combination of horizontal and vertical structures. The Jordan brand has a 10.8 percent share of the overall U.S. shoe market, which makes it the second biggest brand in the country and more than twice the size of Adidas' share 0.06 4 0.24 4. Nike’s organizational structure gets a lot of praise, and it happens to be a matrix organizational structure. Throughout Nike, employees report to team managers who then relay the progress report to the department manager. It not only brings about efficiency but also reduces the chances of error. The global headquarter allows the company to take a standardized approach to run its business across the entire global operation. We will provide you with 100% authentic papers custom written to your assignment requirements, that can get you the grades that you always wanted. The success of an organizational structure largely depends on the leadership styles and the organizational culture. Nike’s flat structure, also known as a matrix structure, consists of several divisions separated into subsidiaries: Converse, Hurley and others, which all report to Nike’s global headquarters. Nike’s organizational structure is a matrix structure. Edit it online with your organizational information and import it as an image or PDF. This is only possible with a centralized structure. … Matrix organizational structure is an overlap between the functional and divisional structures. The success of the company can be largely attributed to it product and marketing strategy, but it can be also attributed to its organizational structure. Creately diagrams can be exported and added to Word, PPT … The divisions according to products help the firm in developing its products as the employees in each division focus on their product only. The regional headquarters are responsible for designing some of the marketing campaigns, which helps in localization of the communicational message sent to the target audience. This can help you to prepare your own paper on Nike without any essay writer help. : The organisational structure of the world's biggest sports goods manufacturers is a reflection of their operational abilities and limitations. Throughout Nike, employees report to team managers who then relay the progress report to the department manager. The introduction of an additional layer in the hierarchy has helped the firm to foster better transparency, seamless flow of information and reduction in complexity. 18+ Risks and Disadvantages of Technology, How to Build Your Business Identity on a Tight Budget. The localization of the marketing activities has helped Nike to become more effective in attracting the customers. The product design is done specifically for their needs. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. Even though, this structure may seem complicated, but Nike … Nike’s Organizational Structure Type and Features Nike has a geographic divisional organizational structure. 5. What is a Triple Net Lease? First, when a single person is working on more than one jobs, he is answerable to more than one bosses. An organizational structure defines task delegation, and line authority establishment within an organization. The new structure is designed to be flatter and more efficient. Nike has an organizational culture that encourages human resources to behave in ways that address business objectives. The matrix organizational structure is a mix of two other organizational structures, the project system, and the functional system. Nike Case Study Analysis. In a matrix structure, the authority passes vertically as well as horizontally. Source . The market demand is highly dynamic, which compels the firm to be constantly on the lookout for new design trends, which can be turned to a new product. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. The teams in Nike’s matrix structure are organized by business unit (apparel, equipment, and footwear) and functional unit (human resources, operations, finance, marketing, and sales). 0 Organizational charts Nike is a mechanistic organization. The following characteristics are notable in Nike’s organizational structure: This type of structure is needed so that Nike can focus on both The firm has chosen, from different types of organizational structures, the one that suits them the most. combination of two or more types of organizational structures 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. It is the world’s largest supplier of athletic shoes and apparel. Nike: Spreading Out to Win the Race The company has gone through several controversies including the child labor This is the reason why you can find different variety of Nike products in your country in comparison to another country. The global headquarter also holds the responsibility of market research, and product development, especially for the footwear segment. Is with similar people in a matrix structure is characterized by dual reporting relationships in employees. Has task culture need team work ; conclude that Nike manufactures in all target markets, thereby creating a brand... Target markets, thereby creating a globalized brand the leaders to make sure that the entire organizational structure a. Better support for each individual markets structure, there are multiple reporting,... Situated in the world in 1964, the firm ’ s organizational which! 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