Strategic Management Analysis

Running head: STRATEGIC MANAGEMENT ANALYSIS
STRATEGIC MANAGEMENT ANALYSIS
Name of the Student
Name of the University
Author Note

STRATEGIC MANAGEMENT ANALYSIS1
Table of Contents
Part 1................................................................................................................................................2
Introduction..................................................................................................................................2
About the company......................................................................................................................3
Overview of the current strategy.................................................................................................4
Strategic issue or problem faced by the company.......................................................................5
Part 2................................................................................................................................................6
Overview of the industry.............................................................................................................6
Competitive analysis of sports industry.......................................................................................7
Structure, culture and leadership analysis of the company..........................................................8
Strategic direction of the company..............................................................................................9
Company Situational analysis....................................................................................................10
Porter’s five forces analysis of the company.........................................................................10
SWOT analysis of the company............................................................................................12
Opportunities and risks faced by the organization....................................................................13
Strategy and competitive advantage of the firm........................................................................13
Part 3..............................................................................................................................................14
Strategy implementation............................................................................................................14
Issues with organizational culture of the company....................................................................14
Key learning...............................................................................................................................15
Recommendations......................................................................................................................15
Conclusion.................................................................................................................................16
References......................................................................................................................................17

STRATEGIC MANAGEMENT ANALYSIS2
Part 1
Introduction
Strategic management is considered to be a process of the management of various
resources of the organization that are required to achieve the objectives and goals. Strategic
management mainly involves the process of setting the objectives, studying competitive
environment, analyzing internal environment of the firm, evaluation of the strategies. The
management aims at rolling out strategies that can be applied in different aspects of the firm in
order to improve strategic management process (Aguinis, Edwards & Bradley, 2017). Two major
approaches to strategic management can be implemented in the modern organizations for the
purpose of understanding the internal and external environment in an effective manner. The two
approaches are mainly known as prescriptive approach and descriptive approach. Business
culture, competencies and the skills of employees are considered to be a major part of the
strategic management procedure that is implemented in the modern organizations (Albrecht et
al., 2015).
The report will be built on the study of a major issue that has been faced by an
organization and the internal culture of the firm as well. The variations that have taken place in
the internal environment after the issue had occurred will also be analyzed in the report in detail.
The industry of operations of the firm will be discussed with the implementation of Porter’s five
forces framework. Recommendations will be provided based on the methods by which the firm
can uphold and improve its processes in the future.

STRATEGIC MANAGEMENT ANALYSIS3
About the company
Nike is a multinational organization of American origin that is mainly engaged in
designing, developing, manufacturing and marketing of the sales of apparel, footwear,
accessories, services and different other equipments as well. The headquarters of Nike is located
in Beverton, Oregon in Portland metropolitan area. Nike is considered to be the largest supplier
of apparel and athletic shoes in the world. The company had gained excess revenues of around
24.1 Billion Dollars in the year 2012. The firm has also employed more than 40,000 people in
different parts of the world and value was valued at around 19 Billion Dollars in 2014 among the
other brands that operate in the industry (Nike.com. 2019). Within the year 2017 the brand has
gained a value of 19 Billion Dollars that has made it one of the most valuable sports brands in
the world. Nike was thereby ranked 89 in the Fortune 500 list of 2018 with respect to the
revenues that have been developed by the firm. Nike was established in the year 1964 under the
name of Blue Ribbon Sports by Phil Knight and Bill Bowerman and firm had provided with the
name of Nike in the year 1971 (Nike.com. 2019).
Nike also provides sponsorships to many sports teams and high profile athletes in various
parts of the world along with the manufacture of sports equipments. The sponsorships are mainly
offered by Nike with the help of its highly recognized Swoosh logo and trademark of “Just Do
It”. Nike has performed the acquisitions of various footwear and apparel based organizations in
the course of its operations in the sports industry. The first acquisition was made by Nike in the
year 1988 of the upscale footwear company named Cole Haan. The company further purchased
Bauer Hockey in 1994 followed by the purchase of another organization named Hurley
International in the year 2002 (Nike.com. 2019). Nike also paid around the 309 Million Dollars
in 2003 in order to acquire Converse. Starter was acquired in 2004 and Umbro was purchased by

STRATEGIC MANAGEMENT ANALYSIS4
the firm in 2008. Nike had also started divesting some subsidiaries in order to develop its focus
on the core business processes of the organization in the industry (Nike.com. 2019).
The profitability levels of Nike had increased by around 13% in the year 2013 due to the
enhancement that had taken place in global orders for the merchandise. Nike is known for the
production of a diverse range of the sports equipment that is offered to consumers in different
parts of the world. The first products that had been developed and sold by Nike in the industry
were the shoes required for track running. The company currently develops shoes, shorts, jersey,
base layers and cleats. The products offered by Nike are related to different sports that include
track and field baseball, hockey, association football, basketball, tennis, cricket and lacrosse. The
first line shoes that had been released by Nike in 1987 were named as Air Max (Nike.com.
2019).
Overview of the current strategy
The generic strategy based on competitive advantage is mainly related to the emphasis of
diversity in the product mix of the organization. The generic strategy of an organization has the
ability to maintain the competitive advantage that has been developed in the industry. The
intensive growth based strategy on the contrary is able to play a key part developing a strategy
that is able to enhance focus of the organization on levels of innovation (Barrick et al., 2015).
Generic strategy of Nike - The two different generic strategies that can be implemented
by the organization include cost leadership strategy and differentiation strategy. Nike has
implemented by the combination of these two generic approaches in order to uphold the
competitive advantage. Nike has used cost leadership strategy by reduction of the costs and the

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selling prices of its products in the 1990s. On the other hand, differentiation strategy was based
on the design of shoes that are offered by Nike to the consumers (Bergh et al., 2016).
Intensive growth strategy of Nike – The mission statement that has been developed by
Nike is mainly based on the innovation that is applied in development of new designs for the
shoes and various products as well. Product development is an important part of the intensive
growth that has been developed by Nike in the sports industry. The attractiveness of products has
been able to influence the preference of products and sales of Nike as well (Burton, 2017). Nike
has also implemented market penetration based intensive growth strategy with the help of
increase in number of stores of the organization and enhancing its presence in the world as well.
The expansion of Nike in new markets like the Middle East and Africa is related to the market
development strategy of Nike. Diversification strategy had been implemented earlier by Nike in
its operations; however, recently the organization does not use this growth strategy in various
countries (Buckley, 2016).
Strategic issue or problem faced by the company
Nike had gained major levels of achievement in its operations in the industry with the
help of its products based on unique designs that have the ability to fulfill demands of the
consumers. The company had however faced major rivalry from many other firms that operate in
the same industry that had an impact on the revenues that have been earned by the firm. The
quarterly sales that have been gained by Nike in the sports industry have reduced in the year
2018 and company started offering 40% discount on the products (Cândido & Santos, 2015). The
company had faced major losses in the United States that accounts for more than 55% of the total
sales that are gained by Nike in the industry. The strategy that is currently being used by Nike in
order to manage its operations in the US is termed as the “Triple Double Strategy: 2X