Nike strategic management : Report

Added on - 28 Dec 2019

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STRATEGIC MANAGEMENT
Table of ContentsINTRODUCTION......................................................................................................................1Corporate profile....................................................................................................................1STRATEGIC ANALYSIS.........................................................................................................1Competitive forces..................................................................................................................1Macro environment analysis...................................................................................................3Competencies and strengths...................................................................................................4STRATEGIC PURPOSE...........................................................................................................6Core purpose and mission......................................................................................................6Main goals and vision.............................................................................................................6Guiding principles and core values........................................................................................6STRATEGIC OPTIONS FOR GROWTH.................................................................................7STRATEGY IMPLEMENTATION........................................................................................10ESSENTIAL CONDITIONS...................................................................................................12REFERENCES.........................................................................................................................14
INTRODUCTIONStrategic management is company current position and strategy analysis to determineits overall capabilities and effectiveness that are helpful to create more value for business. Itis the company’s pattern or plan with which it can achieve its desired goals. The process isadequately comprised in the organization’s decision making management plus senior levelmanagement that is led by chief executive officer plus board. If a company have a propermanagement and use of its strategy than can attain productive outcomes that is the mainpurpose of any business too. Also, strategic management is referred to a group ofdevelopment, evaluation and implementation of cross functions decisions, which make itpossible for company to achieve its decided goals. Here, the paper is analysing strategicmanagement at world’s leading sports company, Nike. The below report gives an awarenessinto Nike with emphasis on its business external environment analysis as well as organizationanalysis of competence, culture and resources. Moreover, through the following analysis twostrategic options for next three years are suggested to the company in relation to its resourcesbased tactics.Corporate profileNike was founded as a Japanese shoes importer and has developed to be world’sbiggest marketer of athletic apparel and footwear. Nike products in US are sold through20,000 retail accounts and in 110 nations. Both in overseas and domestically, the companyoperates its retail outlets including Nike factory and towns stores. Mainly all items areproduced by independent contractors, located primarily overseas with Nike engaged indevelopment, marketing and design. Besides this, its huge range of core athletic apparel andshoes, the organization also sells Bauer and Nike brand athletic equipment, Cole Haan brandcasual and dress footwear and Sports specialities headwear line featuring logos of licensingteam.STRATEGIC ANALYSISCompetitive forcesThis can be analysed by the application of Porter’s Five Forces framework, which include:1
Figure1Porters Five Forces(Source: Myers, 2013)New entrant’s threat – The large retail chains have developed their power due to one stopshopping, operating effectiveness and marketing mix expenses. Hence, it is difficult for newplayers to raise capital because of highly developed supply chains and large fixed costs. Also,high investment required in advanced techniques for stock control systems and checkouts thatinfluence both existing ones and new entrants (Austin and Pinkleton, 2015).Suppliers bargaining power – It represents the suppliers power that can be impacted byleading sports companies, which brings fear of dropping their business to big retailers. Hence,this further consolidates leading positions of outlets, like Nike in negotiating bestpromotional prices from suppliers that are unable to match by small individual.Buyers bargaining power – It is rather high. In this regards, Porter said that the morecommodities that become undifferentiated or standardized, the less the cost of switching andthus more power is given to customers. This means customers can switch easily from onebrand to other. For retaining customers, Nike runs several discount schemes that increases theprofitability of business significantly (Clegg and et.al., 2011).Substitute’s threat – This threat in the market of retail sector is significantly below and it isfrom average up to high. Till the period economic recession prevails, the customers will bemore inclined towards discounts and as a result, Nike has a threat of special purpose outlets.Competitors bargaining power – Threat of new rivalries occurring in the sports sector is lowbecause huge investment of capital is required to create a brand and be competitive. The2
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