The Nike environment is a two-way, matrix organization, where team members often report into two areas such as geography and a global function. The matrix organizational structure is a mix of two other organizational structures, the project system, and the functional system. This can help you to prepare your own paper on Nike without any essay writer help. Nike own several wholly-owned subsidiary brands such as Cole Haan, Converse, Hurley, Umbro, etc. … These subsidiaries operate with certain degree of autonomy, which clearly mentioned boundaries. Moreover, it can also help you to understand how a multi-nationally diverse company like Nike is structured. 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. 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). The Matrix Structure and Nike. 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. The Nike sportswear company is organised in a matrix organizational structure, more commonly known as a flat organizational structure. The firm gets to know about the culture of people living there and it markets its products according to their culture’s liking. This is the reason why you can find different variety of Nike products in your country in comparison to another country. Nike is a well-established sportswear company, headquartered in Oregon, US. 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. Creately diagrams can be exported and added to Word, PPT … Matrix structure combines both functional and divisional structures. The diagram shown above clearly highlights the multiple reporting lines in the matrix organizational structure of Nike. Nike’s organizational structure is a matrix structure. An organizational structure defines task delegation, and line authority establishment within an organization. The Organizational Structure of Nike Nike is the number one innovator in the world in athletic footwear, apparel, equipment, and accessories. By continuing your navigation, you consent to their use. Adding to this, the teams within the organization might start having unhealthy competition amongst them to win over each other. There is no manufacturing of standard products for the entire world’s population. The global headquarter allows the company to take a standardized approach to run its business across the entire global operation. 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. Content Theories: What Really Motivates Us. 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. Profits have grown 57% and Nike’s market cap has more than doubled. Nike’s organizational structure gets a lot of praise, and it happens to be a matrix organizational structure. The global headquarters is the top of the hierarchical ladder, where all the major decisions about the company’s business operations are taken. 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. Employees report to a product (business unit) team which is led by the project manager and … 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 localization of the marketing activities has helped Nike to become more effective in attracting the customers. It not only brings about efficiency but also reduces the chances of error. Global Milk brands in 2020 – What makes them successful? Edit it online with your organizational information and import it as an image or PDF. The company puts many targets that need team work; conclude that Nike has task culture. 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. The global headquarter also holds the responsibility of market research, and product development, especially for the footwear segment. At present, the brand of Nike is valued at USD 32 billion, with the largest market share in the global apparel sector. Many organizations experiment with the structure of the company. Even though there are multiple reporting authorities, the employees are well-aware of what is expected from them from their supervisors. 5. The unnecessary grudges and conflicts arising from this can be detrimental for the firm as well as the employees. The geographic regions in the EMEA are segregated into subregions for better management and control. This means that the tasks of each functional group are done quickly. In a matrix structure, the authority passes vertically as well as horizontally. The regional divisions are given autonomy in taking decisions in their regions. Nike is a powerful example of corporate culture because Parker is serious about reinvigorating his organization on a regular basis. Ans. Moreover, setting regional divisions at different places helps in promotion too. From visiting public places to getting famous sports stars in their advertisements and holding shows with those sports stars to gain people’s attention. First, the regional divisional structure allows Nike to provide different goods in different regions in relation to the preferences of people in those regions. This is because one department will not be aware of the plans of the other departments. The new structure is designed to be flatter and more efficient. On the other hand, the Nike licensing division, as its name suggests, controls the licensing of the Nike brand name. 18+ Risks and Disadvantages of Technology, How to Build Your Business Identity on a Tight Budget. We cover stories to empower you with the knowledge, tools & advice to help you thrive in life and business. What is a Triple Net Lease? The global corporate leadership at Nike which involves corporate leaders makes sure to implement policies throughout the company that is, in all divisions. The structure is characterized by dual reporting relationships in which employees report both to the functional manager and the divisional manager. The matrix organizational structure of Nike accumulates advantages of all different types of organizational structures within it. In a matrix structure, there are multiple reporting lines and responsibilities for the employee. Nike follows a matrix organizational structure which is a combination of horizontal and vertical structures. The Converse is another footwear brand that Nike owns and management in its division controls its operations. The following characteristics are notable in Nike’s organizational structure: Nike’s all-time popular slogan, “Just Do It,” is also featured in our best slogans list. Needless to say, that the entire organizational structure of Nike encompassing every reporting authority in every market location, is extremely complicated. It also oversees all regional operations, expect the EMEA, which is managed by the regional headquarter in Europe. For example, the research and development department may be planning to conduct research on a new kind of product, but at the same time finance department feels that there is too much idle money and it invests the money somewhere. Nike Case Study Analysis. 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. 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. The employees have two reporting authorities, one from the functional department and the other from the product category. On the other hand, it follows a divisional structure on the product basis. This site uses Akismet to reduce spam. Nike Inc.ʼs organizational structureʼs characteristics facilitate control and flexibility in the business. Specify the page count, deadline, academic level and other variable to quickly find out the cost of your essay. A major part of Nike’s success is due to Nike’s organizational structure. 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. 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. Penmypaper.com. Nike’s organizational structure is worthy of study due to the fact that it has been a successful organization since its inception. Nike has an organizational culture that encourages human resources to behave in ways that address business objectives. Consequently, the firm’s tactic of employing creative and innovative ways to market their products is commendable. Moreover, lack of coordination, which is highly likely, can prove to be fatal for the organization. It also enables the firm to establish an organizational culture which is universally accepted in the firm. Even though, this structure may seem complicated, but Nike has been able to leverage it for its own benefit. The operations of the company are also segregated in terms of distribution channel (Wholesale and Nike Direct) and product category (Footwear, Apparel and Equipment). 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. The company follows a highly standardized operational process, which helps the leaders to make quick decision and foster seamless communication. We will provide you with 100% authentic papers custom written to your assignment requirements, that can get you the grades that you always wanted. Enter your email address below to subscribe to my newsletter. By this time, you should have got a clear idea of how the entire business operation is spread out in the organizational structure of Nike. Determine whether a matrix structure could improve performance for Nike. 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. The matrix organizational structure is also followed at the sub-regional level. A matrix structure is made up of different types of organizational structures. 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. Org chart highlighting visualizing the Nike organizational structure. The matrix structure cancels out the extremes of the two structures to balance them somewhere in between. 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. Organizational Structure Characteristics (Analysis) Updated May 8, 2016 Andrew Thompson Nike Inc.ʼs organizational structure reflects the abilities and limits of the business in its operations. Sub-dividing the markets also provide better support for each individual markets. This allows them to become specialists in their particular field, makes them best for the job. Save my name, email, and website in this browser for the next time I comment. Hence, this prevents them from doing any unethical or inappropriate thing that might harm the entire firm’s image. It allows the company to prioritize its goals, as having the right structure leads to the right flow of information. This worldwide company operates in an extremely different organizational structure than other companies, such as Reebok and Adidas. This is to make sure that the development and innovation keep happening in all products that Nike manufactures. All the departments of a functional structure come under the president. 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. The centralized decision-making structure of Nike helps the firm to streamline its information processing and focus on areas which matter the most. 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. 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). © 2021. Nike follows geographical divisional structure to facilitate customers in different areas. Under this leadership comes a functional structure that divides finance, global human resources, product & merchandising, administration &legal, global sports marketing, and operations departments. There will be a combination of vertical and horizontal reporting. 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. 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 operations of each division are separate from each other. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. familiar with common problems and concerns in their Groups This leads to confusion and conflicts, as to whose work should be given priority. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. 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. It should be noted that the apparel design takes place locally, but the footwear design takes place at the global headquarters in Oregon. It is important for you to understand that different companies have different organizational structure, which is responsible for respective growth and sustenance. It is the world’s largest supplier of athletic shoes and apparel. Nike possesses a geographic divisional organisational structure. The product design is done specifically for their needs. By creating sub-regions can help in streamlining the operations of the company. Throughout Nike, employees report to team managers who then relay the progress report to the department manager. Nike: Spreading Out to Win the Race Over the year, Nike implements efficient innovation management structure that assists the company to achieve effective innovative process. The regional headquarters situated in the Netherlands, oversees the business operations in the EMEA region, which comprises of 27 nations. A matrix structure is best suitable for Nike. The matrix structure of Nike also accumulates the disadvantages of all different types of organizational structures in it. Press Esc to cancel. This structure is based on the company’s needs in its global organization, as well as the uniqueness of conditions in regional markets. The firm has chosen, from different types of organizational structures, the one that suits them the most. 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. But there is a limitation to that autonomy. (Photo: Public Domain) Nike Inc. First, when a single person is working on more than one jobs, he is answerable to more than one bosses. However, Nike’s performance figures (see appendix) seem to tell a different story. 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. The company also owns subsidiaries like Hurley International, Brand Jordan and Converse. 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. North America, Western Europe, Central & Eastern Europe, Greater China, Japan and Emerging markets are the regional divisions of Nike structure. Matrix organizational structure is an overlap between the functional and divisional structures. It also makes it efficient for the company to filter the local demand trends based on the sub-regions. Nike Air Zoom track shoes. In a matrix structure, the authority passes vertically as well as horizontally. In a matrix structure, there are multiple reporting lines and responsibilities for the employee. All Right Reserved. It is important to understand that each of these subsidiary brands appeal and cater to different groups of customers. Learn how your comment data is processed. In the Nike brand, teams work across footwear, apparel and equipment product engines. 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. Throughout Nike, employees report to team managers who then relay the progress report to the department manager. Source . Creative organizational chart examples and templates. 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. According to Flatworld Knowledge, Nike is a model of a successful company that uses this structure effectively. This leads to wastage of money and other resources of the firm. 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. Best Green Tea Brands in the world in 2020: What makes them the best? The diagram shown above highlights the structure of Nike in terms of geographic distribution in different regions in the EMEA. Each sub-region is overseen by a sub-regional manager. Despite the problems, the firm has been thriving over the years and has no plans of going down anytime soon. Nike is organized by a matrix structure, which entails multiple responsibilities and report- ing lines for each unit which might be problematicxxx. Nike is known for a complex organizational structure that it describes as a matrix. However, in terms of localization of the marketing strategies, the regional or sub-regional intervention is present. Assess whether Nike’s organizational structure is still a major strength that contributes to its success, or if it is creating problems that will call for organizational design changes in the future. Nike’s organizational structure is one of the best organizational structure examples in the world. Other divisions within Nike organizational structure are the subsidiaries’ and Nike licensing divisions. Even though, this structure may seem complicated, but Nike … Moreover, it also reduces the reporting lines, which leads to better coordination and enhances decision making. May 18, 2018 - Org chart highlighting visualizing the Nike organizational structure. 0 Organizational charts Nike is a mechanistic organization. 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. The independence of decision making and operational autonomy allows these subsidiaries to function free from the strict control of the global and regional headquarters. It is the world’s largest supplier of athletic shoes and apparel. Nike follows a matrix organizational structure which is a combination of horizontal and vertical structures. Nike’s organizational structure is a matrix structure. This is only possible with a centralized structure. A close check is kept on these divisions. Nike came up with an organizational structure so as to aid in regionalizing of business strategy. Nike characterizes its organization as a collaborative matrix organization 0.02 3 0.06 3. This not only increases their incomes but also motivates them to do even better. We’re a strategy, business & marketing resource. The hierarchical structure of Nike can be broken down into three key segments, which are Global Headquarters, Regional Headquarters and Subsidiaries.This hierarchical structure allows the company to maintain a globalized approach to managing its business while ensuring regional control. 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. In this article, we have showcased the organization structure of Nike, which can be used as a case study for your college essay. : The organisational structure of the world's biggest sports goods manufacturers is a reflection of their operational abilities and limitations. Nike’s Organizational Structure Type and Features Nike has a geographic divisional organizational structure. Secondly, the divisional structure leads to a duplication of duties within the firm. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. Nike follows geographical divisional structure to … The Matrix structure could improve the performance of Nike because each manager can achieve a specific task without having all responsibilities put on one person. This type of structure is needed so that Nike can focus on both A matrix structure is made up of different types of organizational structures. Therefore, each of them will have to follow their own product development and marketing communication strategies. Nike: The Organizational Structure Of Nike 1033 Words | 5 Pages. Two divisions will have different departments for the same function, no matter how small the divisions are. Moreover, there are functional departments under the Global corporate leadership, and there is also a team structure in the organization. Whenever you are struggling with your assignments and thinking where can I get my paper writer, just talk to us. The success of an organizational structure largely depends on the leadership styles and the organizational culture. The research plan may face postponement due to low funds. Adding to this, the functional structure helps in enhancing the best form the workforce. 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). However, it should be noted that the what makes it beneficial for the company is the streamlined approach to running the business operations. 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