Understanding and Leading Change: Strategies for Adidas and Nike

This report delves into the critical aspects of leading organizational change, exploring its impact on strategy, leadership, and team dynamics. It analyzes the effects of both internal and external drivers of change, such as technological advancements and market shifts, on organizational behavior and performance, using Adidas and Nike as case studies. The report examines measures to minimize the negative consequences of change, including the application of models like the PDCA cycle and continuous improvement models. It also identifies barriers to change and their influence on leadership decision-making, and explores various leadership approaches to effectively manage organizational transitions. The analysis covers marketing and pricing strategies, the influence of economic and political factors, and the importance of adapting to new technologies and competitive pressures. The report highlights the need for flexible policies, employee motivation, and the importance of understanding cultural differences to successfully navigate change and maintain a competitive edge in the global market.

Understanding and leading
change

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1. Impact of change on organizational strategy and operations ...............................................3
P2. Impact of internal and external drivers of change on leadership, team and individual
behaviour.....................................................................................................................................6
P3 Measures regarding minimising the negative impact of change............................................7
TASK 2............................................................................................................................................9
P4 Barriers of change and their influence on leadership decision making.................................9
TASK 3..........................................................................................................................................10
P5 Contribution of different leadership approaches regarding organisational change.............10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Change is considered as an important factor which have both positive and negative
impact upon the business activities of organisation. The success of organisation depends upon
their capability to accept such changes and make appropriate strategies. There are two major
drivers of change called internal and external. Both these factor have their huge impact on
leadership behaviour and working of team and employees. It is an obligation upon the
management to make their policies flexible which provides in development of motivation and
leadership skills among employees. Successful acceptance of change provides opportunity
regarding lowering their future risks and achieve their desired results within stipulated period of
time. Adidas and Nike are two multinational organisation which provides their products and
services worldwide(Davis and Marshall, 2014).
In the present report explain about, impact of change upon the strategies of both
organisation, affect of internal and external drives of change on leadership and behaviours of
individual or team, measures which minimise the negative impact of change, different barriers of
change and their influence on leadership decision making. Also, different leadership approaches
to deal with changes.
TASK 1
P1. Impact of change on organizational strategy and operations
Change: Change is called as something different happens which effects the capacity of
doing operations but necessary to achieve success in future. There are two important drivers of
change which are internal and external. Internal drivers of change includes technological
capacity, organisational culture, financial management etc. On other hand, external drivers of
change are political condition, economical, social, technological, environmental etc. Adidas and
Nike both are same sector industries which deals in shoes, clothing etc. Digitisation is one of the
important change which is noticed in today's world which has huge impact on both positive and
negative ways on both organisations. Acceptance of change like digitisation helps to expand their
market and attract large number of customers worldwide. This contributes in attainment of
competitive advantage, innovation, large market share, increased profitability etc. Flexibility is
one of the major strength for both the organisation which helps to convert changes in their
success.

Such changes have large number of impact upon the operation of both Adidas and Nike.
It is an obligation upon the management of both organisation is to identify the factors which
influence the behaviour of their employee and teams an reduces their capacity in
accomplishment of their targets. To overcome from such adverse effects and reduction of risk,
requires preparation of policies which helps in motivation of employees to work parallel to such
changes and increase their efficiency.
Major reasons which motivates regarding identification of changes are define below:
 More market share: Adidas and Nike are both multinational organisation. Products of
both companies are purchase and sale in whole world. Use of online technology is
consider as biggest change. Acceptance of online technology satisfies both criteria of
marketing and improved sales. This not only increase the profitability but also provides
the chance to capture large market share.
 Competitive advantage: Identification of factor which leads to change in their
organisation preparation of effective policies helps in improvement of the skills of
employees and their productivity. This makes opportunity for one organisation to drive
their existing competitors out of the market.
 Innovation: The major contribution of acceptance of change is to create innovation
among the employees to complete their work specified period of time. Innovation also
helps in identification of future trends of market and makes changes in their existing
products according to that to satisfy their demands. This helps in improvement of
profitability and brand image (Drover and Ariel, 2015).
Adidas: Adidas is multinational corporation founded in Germany in 1924. The major
area under which company performs their function is designing and manufacturing of shoes,
clothings and accessories. It in considered as one of the biggest sportswear manufacturer in
Europe and becomes the second largest in world. In 2016, it is observed that the revenue of
Adidas is € 19.29 billion.
Nike: It is an American multinational company which is engaged in designing and
manufacturing of footwear, apparel, equipment, accessories etc. More than 44000 employees are
working to deliver their products effectively to end customers. In 2017, brand value of Nike is
calculated as $ 29.6 billion. It is one of the largest supplier and manufacturer of sports equipment
in world.

Adidas and Nike having their operations in world which shows that there are large
number of external factors which impact their business. Both the organisation are very strong
internally as they have much educated employees which have ability to deal with such changes
to make their operations successful (Fragouli and Ibidapo, 2015). But management of Adidas
and Nike need to make changes in strategies and policies which are define below:
Strategies Adidas Nike
Marketing strategies It is big organisation but one
of the biggest competitor of
Adidas is Nike. It comes on
second number after Nike. The
management need to identify
the changes and makes their
policies flexible to accept them
effectively. The change in
technology provides
opportunity to accept online
methods to advertise about
their products. Like use of
social media helps to reach all
over the world specially in
front of youth. It also helps in
reduction of costs to improve
their profit margin to attain
competitive advantage.
Nike is biggest designer and
supplier of sportswear in all
over the world. Large number
of employees are their strength
to understand the behaviour
and trend in market. This helps
to understand the changes and
adopt appropriate strategies.
The main focuses of Nike is to
capture the market of Europe
where the market share of
Adidas is large. For this
purpose, they decided to use
celebrities to sponsorship their
products to influence the
behaviour of customers to
prefer their product over
Adidas.
Pricing strategies Adidas is second largest
organisation worldwide after
Nike. To capture large market
share and attract customers
need to changes in their
pricing policies which helps in
Nike needs to understand the
changing behaviour customers
to fix prices for their products.
This helps to retain their
position in market.

attraction of the individuals
with moderate income.
P2. Impact of internal and external drivers of change on leadership, team and individual
behaviour
Due to globalisation of industrial sector threat of change is increases day by day. The
major factor of changes are external which are present in macro environment factors. It is
consider as most important change driver because every country having different situations and
consumer behaviour which impact the operational ability of multinational organisation. So, all
the multinational organisation like Adidas and Nike requires to make policies as per factors
present in particular country. On other hand, such organisation requires large number of
employees and technologies to provides their functions. This comes under internal drivers of
change which are present within the organisation. This will be notices with the help of SWOT
analysis ton ascertain their weaknesses and strengths. The major internal drivers of change are
employees morale, cultural differences, technological capacity, poor delivery etc. All such
factors largely impact on the performance of employees and teams, influence their behaviour and
leadership. Such internal and external drivers regarding both Adidas and Nike is described
below.
Internal drivers of change
 Organisation Culture: This includes about the behaviour of employees and cultural
difference which are present in both organisations. It is the responsibility of management
of both the organisations to study about such cultural difference and make appropriate
strategies which works to fill gaps of cultural differences. This will provides opportunity
regarding improvement of communication and coordination among the employees and
teams. Such differences creates negative atmosphere, conflicts, lack of support etc. which
reduces production ability ( Goldstein, Sauer and O'Donnell, 2014).
 Financial management: Funds are important requirement of every company to
effectively provide their functions. Every department of both the organisation requires
sufficient amount of funds to activities their personal goals. Lack of funds and

mismanagement reduces their operational capacity and arises risk factor. This affects in
optimum utilisation of their given resources.
External drivers of change
 Economy: This includes about the economic condition present in such country. Adidas
and Nike provides their activities in many countries and having direct link with their
economical situations. The situation of inflation and deflation in such particular nation
badly affects their profitability and market share.
 Political influence: This includes about the political situation which are present in
country. This includes government policies, political stability, tax policy, ideology of
parties etc. which affects the business operation of Adidas and Nike.
 New competitors: Competitors are the biggest factors which affects business activities of
organisation. New competitors use innovative technologies, ideas, reasonable pricing
policies to capture market which attracts the customers of such big organisation like
Adidas and Nike (Groppel, 2011).
 Technology: It is also one of the external factor which changes automatically and affects
the business operation of organisation. It is the duty of management of both organisation
to accept new technologies for optimum utilisation of their resources and make their
process more cost efficient. Non acceptance of technologies makes the company out of
the market.
P3 Measures regarding minimising the negative impact of change
There are many change management policies are present in market which helps in
reduction of the risk which are associated with such changes. Acceptance of such theories helps
to make their process and procedures up to date to minimise the adverse impact of changes. Such
theories are called as system theory, PDCA cycle and Bohner and Arnold change impact analysis
theory etc. It helps in identification of the changes in earlier stages and preparation of effective
procedures which guides employees in performance of their functions and development of their
skills, innovation and leadership. Application of such theories by Adidas and Nike provides
opportunity to make their position in market, creation of long term relation with their employees,
attain the loyalty and trust of customers towards the quality of their products. This helps in
improvement of their sales and profitability.

 Continuous improvement model: It is effective model which helps in continuous
identification of the changes in internal and external factors and accept them to improve
their productivity. Implementation of this model reduces the workload of the
management of both Adidas and Nike which can be concentrated on other important
matters. This model comprises PDCA cycle which works to make the future of
organisation better.
PDCA Cycle: This cycle includes various functions which has large importance for both Adidas
and Nike. Such functions are define below:
- Plan: It is initial stage which includes about determination of changes in different factors.
- Do: This step involves the process of application of such changes on real operations of
business.
- Check: This step is most important which helps in identification of impacts which are derived
by both organisation after acceptance of such changes. This helps to ascertain their positive and
negative impacts.
- Act: This includes about implement of large level in whole process of organisation from
strategic to production level. If the organisation derive positive effects on their sales and
profitability should be continued with this model. Otherwise, needs to application of such
another approach.
 System theory: This theory adopted by both Adidas and Nike in development of
leadership qualities among their employees. This helps to tackle the difficult situations
from front and guide other employee’s. The major focus of this theory is to motivate their
employees always work in team whatever the situations are arises due to changes. This
helps to make effective communication and coordination's. It contributes in minimising
the adverse effect of changes. Under this theory, leader recognises as supra system and
other factors as system. Leaders plays an important role in development of flexibility
among team members (Ellenbogen, Berger and Batjer, 2010).
 Bohner and Arnold impact analysis theory: The main focus of theory is to identify the
consequences of changes on the operation of both the organisations. So, effective
measures are taken by the management and remove their adverse impacts. This helps to
make standards and contingency policies which provides direction. It also identifies the
risks which are associated with such changes and their impact on resources, planning,

efforts. It can be categorized into three parts which are Trace, Dependency and
experimental.
TASK 2
P4 Barriers of change and their influence on leadership decision making
There are many barriers which affects the capacity of the organisation in acceptance of
such changes and have large influence on the decision making power of management. Such
barriers are are present both inside and outside of organisation. Inside the barriers which are
present are employees, technology and outside of the organisation which are present are
government regulation. The effective which is used by the management of both Adidas and Nike
is Force field analysis. This analysis helps in identification of the such factors which are for and
against the acceptance of changes (Hall, 2010Harris, 2012).
Force Field analysis
It is effective method which performs as determination of difficulties which are faced by
organisation to implement such changes. This contributes in determination of the relationship
between the factors which are in favour and against such change.
Step 1: Plan for change
This includes about the objectives for which both the organisation makes changes in their
existing process and procedures. The basic aim of both Adidas and Nike is to capture market and
improve their profitability.
Step 2: Factors of change
This includes the factors which make force upon organisation to accept changes. Such
factors are both internal and external. Internal includes about, outdated machinery, low team
morale etc. Externally includes change in demographic trends, uncertain environment etc.
Step 3: Factors which are against of change
These are of two types which are called as internal and external. Internal resistors
includes about fear of unknown, attitudes and attributes, existing organizational structures. In
external includes about government legislation etc.
Step 4: Providence of scores

This includes the procedure of providing scores to the forces of change on the basis of
their strength and weaknesses to influence the behaviour of management of both organisation.
This helps to make strategies and identification of the factors which requires more emphasis.
Step 5: Analyse and application
This step includes about the identification of risk which are attached with such factors
and apply in real scenario in organisational procedures and takes step toward achievement of
their objectives and aims.
Different barriers of change and their influence on decision making
There are many barriers of change which not allows the organisation implement changes.
This will have negative impact on the decision making power of management. It is the duty of
both organisation to identify such barriers and adopt appropriate approaches to change their
behaviour. Such barriers affects growth activities of organisation and resist to attain
sustainability in their performances. It affects upon the relation which are made by organisation
with their employees and customers. It brings difficulties in to gain the confidence of them again.
Such different barriers and their influence are define below:
 Government legislation: It is one of the external barrier which is different in every
country. Some of the legislations of the government restricts the organisation in
implementation of such change which is not allowed as per government regulations.
 Employee’s: Employees are important assets on which whole performance of Adidas and
Nike is depends. Employees are biggest barrier because they not wants to change their
behaviours and processes to which they are familiar.
 Environment: Some changes are of such kind which has many adverse effect on
environment and develops the issues of security. Then it will become the barrier for
organisation to accept such change dues to their adverse effect on environment and
society (Mayfield, 2014).
TASK 3
P5 Contribution of different leadership approaches regarding organisational change
It is observed that the changes which are happen in organisation has impact on the
leadership of the individual and teams. So, to remove the adverse impact of such changes need to
implement different leadership approaches. Such leadership approaches helps in development of

motivation and supportive behaviour among the employees and teams of Adidas and Nike. So,
contribution of leadership approaches in organisational changes is defined below:
 Situational leadership: This theory provides more emphasis on situations which are
developed in organisation and their impacts on activities. This includes about leadership
approaches which are changes with the change in situations. Under this theory, main role
is played by leader as it changes in theories as per the situation arises in front of their
teams and employees. This helps to attain the confidence and trust of teams and
employees towards their leader.
 Transactional leadership: The main function of this leadership theory is to control the
flow of activities to accomplish their targets which are predetermined. This theory is
called as Ship float due to its features. Leaders whom uses such theory has main aim is to
enhance the performance of employees by use of best approaches. Best employee’s are
getting reward and appreciation from manger which improves their courage and
dedication (Saha and et. al., 2013).
 Transformational leadership: Under this theory leader performs functions with their
team members to ascertain the difficulties faced by them and provide proper guidance to
solve their issues. This provides opportunity regarding motivation and enhancing the
performance of team members at different operational levels.
CONCLUSION
It has been concluded from the above report that, change is important factor which helps
in success of organisation. But it creates obligation upon the management to be more attentive
and make frequent changes in their polices. There are various approaches are used by the
management of Adidas and Nike in development of leadership among employee’s and teams.
This helps in creation of innovation and improvement of skills. Political, economical, social,
technological, legal are such external factors which have major impact and large influence of
decision-making. System theory and PDCA cycle is used to minimise the adverse impact of
changes. Various leadership approaches are also used for motivation and development of
leadership skills among the employees of both organisation to lead their teams in achievement of
their predetermined goals.

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