Change Management at Nike

This report analyzes the organizational and development lessons that can be learnt from Nike's study on its supply chain at its factories, which involved a 15% reduction in non-compliance with labor standards. The report highlights how Nike overcame resistance to change by implementing Lean transformation, incentivizing contract factories, reducing waste, and improving working conditions. It also discusses the importance of understanding why people resist change and planning for it well in advance.

Nike: Change Management

Table of Contents
1. Introduction..................................................................................................................................3
2. Resistance to Change at Nike......................................................................................................3
3. Implementing Contingency Approach to Change Management.................................................5
4. Recommendations and Conclusion..............................................................................................5
Bibliography....................................................................................................................................7

1. Introduction
Change management is considered to be very crucial in order to gain competitive advantage
which is considered to be the main aim of many organizations. Most of the leaders as well as the
change agents face various conflicting challenges regarding understanding as well as
motivating the highly diverse workforce , being accountable to stakeholders while planning for
their future in a highly chaotic environment (Waddell, Creed, Cummings, & Worley, 2014).
This report analyses the organizational and development lessons that can be learnt from an
organization, Nike.
2. Resistance to Change at Nike
In case of Nike ‘s study of its supply chain at its factories it was found that by adopting Lean
was associated with 15 percent reduction in non-compliance with the labour standards for
example time off, wages, as well as benefits. In 1990’s the global boycott campaign became
very successful and it showed how industry giants can be accounted by consumers the
stakeholders. Then Nike board member Jill Ker Conway visited several factories of Nike and
identified many ways in which they can be improved by bringing a change in relationship
between the management and workers (Griffin-Smith, 2016).
Thus Nike started making commitments with its longstanding suppliers so as to implement Lean
transformation. The transformation to lean required higher commitment for the contract
factories. Many factories had to change their physical layout of entire shop floor; managers who
were responsible for lean manufacturing were appointed and sent for training to Sri Lanka.

Even Nike’s President and CEO Mark Parker have discussed that it is design which keeps ion
changing and helps in propelling the $60 billion business ahead. They try to overcome resistance
to change by innovating new ways for example the new Flyknit running shoes (Brownlee, 2013).
This indicates that change itself is not the issue rather resistance to the change is the major
problem. Lean helped the Nike workers as they were assigned the responsibility individually
towards quality control as well as they started finding out techniques through which they can
improve overall production. This helped in increasing their skill sets as well as added value to
the business (Rick, 2013).

3. Implementing Contingency Approach to Change Management
Contingency Approach is quite different approach towards change that works in various
circumstances. The change model incorporates soft as well as award approaches and this model
is two dimensional matrix with two categories that are : scale of change and style of
management which need to be used by an organization in order to facilitate change. Out of the
four strategies of organizational change that are: Participative evolution, charismatic
transformation, forced evolution and Dictatorial transformation, Nike adopts Charismatic
transformation. For example in case of Nike the CEO Phil Knight responded to the over campus
apparel , focus groups as well as campus protests with young teenagers who got to know about
sweatshops. The leadership in this case is found to be collaborative or consultative form of
leadership and scale of change is corporate transformation . ON the top level of management
leadership at Nike is laissez- faire because all the different departments get the freedom in the
decision making process and the top management is also responsible for motivating as well as
transferring the visions of the company so that finally the organizational goals and missions are
fulfilled (Carty, 2010). Nike on the other hand keeps on developing large number of innovative
techniques in order to handle its business. Its organizational structure as well as the peculiarities
in the management helps the company to stay sensitive regarding the changing consumer as well
as social trends.
4. Recommendations and Conclusion
Since resistance towards change is a major issue which the organizations face so to handle that
change the leaders or change agents play a crucial role. However, the leaders can’t control much
of the world which is changing around, but they can still give response to the manner in which

the employees feel about the change. By understanding some of the most common reasons due to
which the people oppose the change Nike got an opportunity to plan their change strategy in
order to address all these factors. Thus by expecting some kind of resistance towards change as
well as planning for it well in advance rather from the beginning of the firm’s change
management helps in very efficiently as well as effectively manage all the objections. Lean at
Nike helped it in incentivising the contract factories so as to improve their working conditions, it
also helped in waste reduction as well as decline in inefficiencies and helped in safeguarding
employee satisfaction. Thus Nike being a socially responsible company is every ready for change
and keeps on changing itself.

Bibliography
Brownlee, J. (2013, February 10). Nike’s 5 Lessons On Innovation By Design. Co. Design.
Carty, V. (2010). The Internet and grassroots politcs: Nike, the athletic apparel industry and the
anti-sweatshop campaign. Tamara Journal for Critical Organization Inquiry.
Griffin-Smith, I. (2016, October 31). How Nike Used Lean to Solve its Sweatshop Problem. The
Leadership Network.
Rick, T. (2013, March 8). CHANGE IS NOT THE PROBLEM – RESISTANCE TO CHANGE
IS THE PROBLEM. Meliorate: Change Management.
Waddell, D., Creed, A., Cummings, T., & Worley, C. G. (2014). Organisational Change:
Development and Transformation 6th Edition. Cengage Learning.