nike organizational structure matrix

This is to make sure that the development and innovation keep happening in all products that Nike manufactures. The independence of decision making and operational autonomy allows these subsidiaries to function free from the strict control of the global and regional headquarters. The Nike sportswear company is organised in a matrix organizational structure, more commonly known as a flat organizational structure. An organizational structure defines task delegation, and line authority establishment within an organization. A close check is kept on these divisions. By continuing your navigation, you consent to their use. 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. Training programs are designed to uphold such corporate culture that aligns with the Nike brand image for sports footwear, apparel and equipment. 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. But there is a limitation to that autonomy. 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. Moreover, it can also help you to understand how a multi-nationally diverse company like Nike is structured. 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. A major part of Nike’s success is due to Nike’s organizational structure. Whenever you are struggling with your assignments and thinking where can I get my paper writer, just talk to us. What is the structure of Nike organisation? 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. The structure is characterized by dual reporting relationships in which employees report both to the functional manager and the divisional manager. Secondly, the divisional structure leads to a duplication of duties within the firm. In a matrix structure, there are multiple reporting lines and responsibilities for the employee. Nike came up with an organizational structure so as to aid in regionalizing of business strategy. familiar with common problems and concerns in their Groups Nike’s organizational structure is a matrix structure. Consequently, the firm’s tactic of employing creative and innovative ways to market their products is commendable. © 2021. 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. This can help you to prepare your own paper on Nike without any essay writer help. … There will be a combination of vertical and horizontal reporting. Nike is known for a complex organizational structure that it describes as a matrix. Moreover, there are functional departments under the Global corporate leadership, and there is also a team structure in the organization. Moreover, it also reduces the reporting lines, which leads to better coordination and enhances decision making. 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. 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. Each sub-region is overseen by a sub-regional manager. 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. The global headquarters is the top of the hierarchical ladder, where all the major decisions about the company’s business operations are taken. Other brands that Nike owns are Bauer, Hurley, and Exeter which also have the same structural characteristics as Converse. It is the world’s largest supplier of athletic shoes and apparel. Content Theories: What Really Motivates Us. It is the world’s largest supplier of athletic shoes and apparel. Nike’s annual revenue hit $24 billion last year, a 60% increase since he took the reins as CEO in 2006. It allows the company to develop a brand image which is universally identical in all target markets, thereby creating a globalized brand. The company puts many targets that need team work; conclude that Nike has task culture. Nike: Spreading Out to Win the Race It is important for you to understand that different companies have different organizational structure, which is responsible for respective growth and sustenance. It not only brings about efficiency but also reduces the chances of error. The company follows a highly standardized operational process, which helps the leaders to make quick decision and foster seamless communication. 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). 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 success of an organizational structure largely depends on the leadership styles and the organizational culture. The company also owns subsidiaries like Hurley International, Brand Jordan and Converse. This is only possible with a centralized structure. Nike’s organizational structure gets a lot of praise, and it happens to be a matrix organizational structure. Enter your email address below to subscribe to my newsletter. These subsidiaries take most of the decisions themselves, with authorization from the headquarters. 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. 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. This structure is based on the company’s needs in its global organization, as well as the uniqueness of conditions in regional markets. It is important to understand that each of these subsidiary brands appeal and cater to different groups of customers. Nike’s organizational structure is one of the best organizational structure examples in the world. The operations of the company are also segregated in terms of distribution channel (Wholesale and Nike Direct) and product category (Footwear, Apparel and Equipment). Best Green Tea Brands in the world in 2020: What makes them the best? It allows the company to prioritize its goals, as having the right structure leads to the right flow of information. Nike follows a matrix organizational structure which is a combination of horizontal and vertical structures. 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. Over the decades, the company has expanded its business through diversification into various international markets and by extending its brand portfolio. 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. Moreover, lack of coordination, which is highly likely, can prove to be fatal for the organization. This means that the tasks of each functional group are done quickly. This site uses Akismet to reduce spam. 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 organisational structure of the world's biggest sports goods manufacturers is a reflection of their operational abilities and limitations. Save my name, email, and website in this browser for the next time I comment. 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 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 not only increases their incomes but also motivates them to do even better. Nike possesses a geographic divisional organisational structure. All Right Reserved. Throughout Nike, employees report to team managers who then relay the progress report to the department manager. Nike characterizes its organization as a collaborative matrix organization 0.02 3 0.06 3. 0 Organizational charts Nike is a mechanistic organization. At present, the brand of Nike is valued at USD 32 billion, with the largest market share in the global apparel sector. 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. Penmypaper.com. Org chart highlighting visualizing the Nike organizational structure. Types of Branding: Learn more about branding and its significance. On the other hand, the Nike licensing division, as its name suggests, controls the licensing of the Nike brand name. It also oversees all regional operations, expect the EMEA, which is managed by the regional headquarter in Europe. By creating sub-regions can help in streamlining the operations of the company. 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. Other divisions within Nike organizational structure are the subsidiaries’ and Nike licensing divisions. What is a Triple Net Lease? In this article, we have showcased the organization structure of Nike, which can be used as a case study for your college essay. Determine whether a matrix structure could improve performance for Nike. This is because one department will not be aware of the plans of the other departments. 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. North America, Western Europe, Central & Eastern Europe, Greater China, Japan and Emerging markets are the regional divisions of Nike structure. Nike is organized by a matrix structure, which entails multiple responsibilities and report- ing lines for each unit which might be problematicxxx. The Organizational Structure of Nike Nike is the number one innovator in the world in athletic footwear, apparel, equipment, and accessories. It also makes it efficient for the company to filter the local demand trends based on the sub-regions. 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. First, when a single person is working on more than one jobs, he is answerable to more than one bosses. The localization of the marketing activities has helped Nike to become more effective in attracting the customers. In a matrix structure, the authority passes vertically as well as horizontally. Needless to say, that the entire organizational structure of Nike encompassing every reporting authority in every market location, is extremely complicated. A matrix structure is best suitable for Nike. The Matrix structure is more feasible for organizations operating in a business environment … The global corporate leadership at Nike which involves corporate leaders makes sure to implement policies throughout the company that is, in all divisions. On the other hand, it follows a divisional structure on the product basis. We’re a strategy, business & marketing resource. 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. These subsidiaries operate with certain degree of autonomy, which clearly mentioned boundaries. Hence, this prevents them from doing any unethical or inappropriate thing that might harm the entire firm’s image. 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. 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. 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. It also enables the firm to establish an organizational culture which is universally accepted in the firm. Press Esc to cancel. 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. The regional headquarters situated in the Netherlands, oversees the business operations in the EMEA region, which comprises of 27 nations. Adding to this, the functional structure helps in enhancing the best form the workforce. Nike Case Study Analysis. The product design is done specifically for their needs. Two divisions will have different departments for the same function, no matter how small the divisions are. Many organizations experiment with the structure of the company. Nike’s all-time popular slogan, “Just Do It,” is also featured in our best slogans list. Moreover, setting regional divisions at different places helps in promotion too. Even though, this structure may seem complicated, but Nike has been able to leverage it for its own benefit. 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. 5. May 18, 2018 - Org chart highlighting visualizing the Nike organizational structure. However, Nike’s performance figures (see appendix) seem to tell a different story. According to Flatworld Knowledge, Nike is a model of a successful company that uses this structure effectively. Strengths of Nike's Innovation Management Structure Over the year, Nike has been able to achieve a superior performances using matrix innovative management structure. Ans. We will provide you with 100% authentic papers custom written to your assignment requirements, that can get you the grades that you always wanted. Under this leadership comes a functional structure that divides finance, global human resources, product & merchandising, administration &legal, global sports marketing, and operations departments. This leads to confusion and conflicts, as to whose work should be given priority. The operations of each division are separate from each other. Nike is a well-established sportswear company, headquartered in Oregon, US. Over the year, Nike implements efficient innovation management structure that assists the company to achieve effective innovative process. The unnecessary grudges and conflicts arising from this can be detrimental for the firm as well as the employees. From visiting public places to getting famous sports stars in their advertisements and holding shows with those sports stars to gain people’s attention. Established in 1964, the company has now become one of leading sports shoes, apparel and equipment brand in the world. 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). Matrix structure combines both functional and divisional structures. The centralized decision-making structure of Nike helps the firm to streamline its information processing and focus on areas which matter the most. Nike follows geographical divisional structure to facilitate customers in different areas. The company has gone through several controversies including the child labor (Photo: Public Domain) Nike Inc. Nike is an American multinational company producing equipment, footwear, clothes, and accessories. Throughout Nike, employees report to team managers who then relay the progress report to the department manager. The matrix structure of Nike also accumulates the disadvantages of all different types of organizational structures in it. In a matrix structure, the authority passes vertically as well as horizontally. Nike own several wholly-owned subsidiary brands such as Cole Haan, Converse, Hurley, Umbro, etc. 18+ Risks and Disadvantages of Technology, How to Build Your Business Identity on a Tight Budget. Nike: The Organizational Structure Of Nike 1033 Words | 5 Pages. The new structure is designed to be flatter and more efficient. The firm gets to know about the culture of people living there and it markets its products according to their culture’s liking. A matrix structure is made up of different types of organizational structures. This leads to wastage of money and other resources of the firm. 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. 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. Employees report to a product (business unit) team which is led by the project manager and … 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. Therefore, each of them will have to follow their own product development and marketing communication strategies. 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. Sub-dividing the markets also provide better support for each individual markets. However, it should be noted that the what makes it beneficial for the company is the streamlined approach to running the business operations. Despite the problems, the firm has been thriving over the years and has no plans of going down anytime soon. Nike has an organizational culture that encourages human resources to behave in ways that address business objectives. 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 a matrix structure, there are multiple reporting lines and responsibilities for the employee. The divisions according to products help the firm in developing its products as the employees in each division focus on their product only. The geographic regions in the EMEA are segregated into subregions for better management and control. This allows them to become specialists in their particular field, makes them best for the job. Type above and press Enter to search. 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 following characteristics are notable in Nike’s organizational structure: Even though, this structure may seem complicated, but Nike … The diagram shown above clearly highlights the multiple reporting lines in the matrix organizational structure of Nike. Your navigation, you consent to their culture ’ s performance figures see! 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