Nike: Business Environment, Structures and Functions Report

This report provides a comprehensive analysis of Nike's business environment, organizational structure, and the interrelationships between different business functions. It begins with an introduction to the business environment, differentiating between micro and macro factors, and introduces Nike as a case study. The report then explores various types of organizations including private, public, and voluntary companies, providing examples like Nike, NHS, and Oxfam. The analysis delves into the size and scope of these organizations, detailing their missions and visions. Furthermore, the report examines different types of business structures, such as matrix and divisional structures, with a focus on how Nike employs these structures. It also discusses the interrelationships between key business functions like marketing, finance, human resources, and production, highlighting how these departments interact to achieve organizational objectives. The report concludes by summarizing the key findings and implications of the analysis.

Business and
Business
environment

Contents
INTRODUCTION...........................................................................................................................3
ACTIVITY A...................................................................................................................................3
Different type of organisations...............................................................................................3
Size and Scope of different organisation................................................................................5
Different type of business structure and interrelationship on different business function.....7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Business environment is collection of internal as well as external factors such as
customer's needs, employees, owners, client, suppliers, innovation in technology, social trends,
economic changes and many more (Andersson, Forsgren and Holm, 2015). All these factors
have wide impact on working of organisation in positive and negative both manner. Business
environment is classified within micro and macro environment. In this report chosen company is
Nike which is part of Apparel, accessories and sports equipment industry. It was founded in
1964 by Bill Bowerman and Phil Knight they are serving at worldwide level. Respective report
will include detail explanation related to type of organisations along with their scope as well as
size. Along with this, it also involves explanation of relationship within different organisational
functions along with their advantages and disadvantages as well as its impact on organisational
structure.
ACTIVITY A
Different type of organisations
Organisation is social unit of people which is structured as well as manage for meeting
common goal. It has management structure that determine relation within several activities and
members, responsibilities and authorities for carrying out various task. Moreover, organisation is
open system and they get affected by business environment (Babu, 2012). There are various type
of organisation available in business environment i.e., private, public and voluntary. All these
have their own aim, objective, goals, purpose and so on. Explanation of these with suitable
example are as follows :-
Private Limited Company – These are the companies which privately held by small
business entity. Private limited companies limit owners liability to their shares as well as there
should be limited number of share i.e., 50. most important is that publicly trading of shares is
restricted for shareholders. Such organisations have limited liabilities which is according to the
total amount invested for running business. Furthermore, there should be minimum 2 members
and maximum 200 are required for starting a private limited company. For example, Nike is
private limited Company, Founded in 1964 by Bill Bowerman and Phil Knight. They are offering
athletic footwear, apparels, sports equipment's and many more at worldwide level. It include
some enterprises such as :-

 Partnership – It is one of the best method for starting business because through
partnership in less funds also business can be establish (Boons and Lüdeke-Freund,
2013). Partnership is classified within two main categories i.e., two partner business as
well as more than that. Within this type of business every partner invest money for
running business and profit & loss divided as per the ratio of amount invested.
 Sole traders – In this type of business, particular person have authority of operating and
running business. Moreover, in sole trader owner of company is liable for occurrence of
both profit and loss. Within such corporation family members are included by owners.
 Limited Company – It is important for an entity to get register for becoming limited
company. Profit of limited companies directly belong to company not with shareholders
and they get profit in form of dividend. On the amount of profit earned corporation tax
have to pay by company in every year.
Voluntary Company – These are the organisation which working for welfare of society
and not for generating profit. Companies working in voluntary sector are separate from public
and private organisation. Moreover, respective sector corporation way of think is to create social
welfare instead of material wealth (Dima, Grabara and Modrak, 2014). It has been analyse that
motive of voluntary companies is to develop underdeveloped individual of society. For example,
Oxfam is biggest charitable company which working for removing poverty as well as aim is to
promote happiness at global level by removing poverty. In addition to this, Oxfam have large
market share because they are working at worldwide level. Respective company mainly work on
health, trade justice, education, gender equality, livelihood and many more.
 Trust – They cannot enter within any type of legal agreements with their own name
because they are not legal entity.
 Unincorporated Association – Such association have no limitation of liability as they
come under an agreements on the behalf of charity as well as personal liability.
Unincorporated association is not legal entity.
Public limited Company – They are he organisation which owned controlled as well as
manage by government of particular nation. Such companies have limited liabilities and they
sold their shares to public (Ehret, Kashyap and Wirtz, 2013). For instance, National Health
Services (NHS) is public limited company introduced in 1948 and it is one of the biggest health
care services provider. Aim of NHS is to develop effectual services for their customers. There is

requirement of minimum two directors as well as one secretary for running of public limited
company. There should be minimum number of share capital before starting a public limited
company. Large number of shares and authority are in the hand of government of particular
nation. Central government department – Public limited companies within specific state or
district is run by central government.
 Local authorities – Organisation of some specific city is run as well as manage by local
authorities of that particular city.
Size and Scope of different organisation
Every organisation have there own size and scope as per the amount of capital invested.
Along with this, every company is totally depended on there customers because they are the one
who help in accomplishing goals as well as objectives within effective manner (Hallward-
Driemeier and Pritchett, 2015). Organisation size and scope is totally depended on key factors.
Explanation of these in relation to public, private and voluntary organisation are mention
below :-
Nike – It is private sector company founded in 1964 by Bill Bowerman and Phil Knight.
Products offering by them are sports equipments, athletic footwear, recreational products and
many more at worldwide level. Within private companies owner is liable for every type of profit
and loss.
 Size and Scope – Nike range of offering is increasing day by day as they have approx.
38000 staff members at worldwide level. Along with this, they have offices in more than
45 different nations as well as stores are approx. 700 around worldwide level.
 Mission - Nike Inc.’s corporate mission is “to bring inspiration and innovation to every
athlete in the world.”
 Vision - Nike Inc.’s corporate vision is “to remain the most authentic, connected, and
distinctive brand.”
National Health Services (NHS) – NHS is public limited organisation which provide
services related to health care (Hilton and Platt, 2013). It is located in England, Wales and
Scotland as well as principle of NHS is that services offered to individual should be universal,

comprehensive and free while delivery. Along with this, National Health Services main motive is
to offer effective services as well as to make customer satisfy.
 Size and Scope – National Health Service is wide in size as there are approx. 1,700,000
employees working in it. Its scope is huge because they are doing good job by providing
these facilities in good manner by helping people and also earning money.
 Mission – NHS Mission is to provide quality of care to everyone on daily basis.
 Vision – National Health Services vision is to deliver better health, care and values to
people.
Oxfam – It is voluntary sector organisation which working for welfare of society and its
main objective is to remove poverty (Hockerts, 2015). Moreover, Oxfam is biggest charitable
association which assist in removing poverty from worldwide level. It is working for end
injustice to poverty as well as several other operations are also perform by respective
organisation such as disaster relief, poverty alleviation and many more.
 Size and Scope – Oxfam is working in approx. 94 countries at worldwide level with
almost thousand local partner corporation. They are working for social welfare as within
more than 50,000 volunteers at global level. Scope of Oxfam is wide because population
is exploding and poverty is increasing.
 Vision – Oxfam vision is to remove poverty as well as people should be treated equally
without any discrimination. There believe is to create fair world which should be free
from poverty.
 Mission – Oxfam mission is to become favourite charity of people by convincing them
for donating funds.

Different type of business structure and interrelationship on different business function
Organisational Chart is diagrammatic presentation which convey internal structure of a
corporation by explaining responsibilities, role as well as relation within particular person and
entity in detail (Seethamraju, 2012). Nike can use organisation chart in numerous ways such as
work responsibilities, improve line of communication, create visual staff directory and many
more. There are several type of organisational chart like functional, divisional, flat and matrix.
(Source: Nike organisational structure, 2019)
Nike is following Matrix organisational chart and its success is totally depended on it. It
is one of the different type organisational chart because within this authority passes vertically as
well as horizontally. Along with this, for facilitating customers Nike is following divisional
structure. It marks off organisational structure as per the specific demand of goods, market as
well as customer within specific business environment (Nike’s Organizational Structure, 2018).
Divisional organisational chart is suitable for such companies which operate chain stores and
subsidiaries within nation and international level. With the implementation of this organisational
chart Nike will be able to decentralize their decision making as well as establish accountability
and enhance coordination among staff members.
Illustration 1: Nike organisational structure, 2019

There are several departments within a business organisation which help in carring out
business related activities with full potential and desired business objective is effectively
accomplished (Tutunea and Rus, 2012). All these functional department plays a very curial role
in creating sustainable business environment. Without the presence of all these business
departments, organisation fails to effectively implement its desired policies but it also fails to
operate successfully. Following are the major departments which big scale organisation
comprises in order to effectively carry out business related activities accurately:
 Marketing and Finance Department: Both of these departments are considered as the
two pillars on which the overall business is enormously dependent. Major responsibility
of finance and accounting department focuses on budgeting, reporting and effective
management of projects. Whereas the marketing department within an organisation
effectively focuses on generating overall sales volume and capturing new market share.
With regard to Nike, both of these department regularly interacts with each other in order
to maintain accurate flow of information (Sodeyfi, 2016). Finance department of Nike
essentially ensures that all the business related decision is taken keeping in mind the
financial capabilities of Nike. Through proper interaction between both of these
department growth as well as profitability within an organisation is witnessed. Whereas
the drawback is that the dependency of both these department sometimes tends to hamper
overall productivity. Such situations impact the overall organisational structure of Nike to
a great extent and consistency within respective organisation is witnessed.
 Human Resource Department with Marketing: Human resource department and
marketing department are considered important because they tremendously help
businesses in accomplishing desired business objective effectively. The HR department is
extensively responsible hiring and firing the workforce. Whereas effective coordination
between both of these department is very necessary. It is the marketing department within
a firm which essentially coordinates the need for workforce within an organisation to HR
department. Through proper coordination among both these departments most skilful and
knowledgeable workforce is hired whereas sometimes due to lack of coordination hiring
of employees is not taken effectively.
 Finance and Production Department: Finance as well as production department within
an organisation also interacts with each other in order to effectively carry out business

related activities with full efficiency. Finance department tends to formulate guidelines
on the basis of which production department essentially work. It essentially formulates
accurate budget to effectively meet up the demand of business requirements (Marketing
and its relationship with other business activities, 2019). Funds allocation to production
department is done according to the requirements and guidelines stated. Through
effective coordination between these two department smooth flow of business operation
is witnessed. However, if proper interaction is not carried out productivity is negatively
hampered and organisation essentially suffers. With reference to Nike, accurate
coordination is observed which essentially helps accomplishing desired business
objective.
All these mentioned department plays a very curial in accomplishing desired business
objective effectively. Moreover, each of the concerned business department is interrelated to
each other and tends to help in attaining desired business objective effectively. Each of the
respective department follows a proper flow of communication so as to effectively manage
business operation in such a manner that productive is observed (Voegtlin, Patzer and Scherer,
2012). With regard to Nike, respective company follows Matrix Organisational structure in order
to effectively carry out business related operation accurately. Moreover, each department is
extensively dependent on each other. Interaction among all these departments ensures to proper
and smooth functioning due to which consistency as well as sustainability with business
operation of Nike is effectively witnessed.
CONCLUSION
According to the entire discussion it has been summarised that, environment in which
business exist is dynamic in nature so it is necessary for every organisation working within it to
analyse in proper manner. Business environment is classified in two factors i.e., micro and
macro. It is crucial for corporation to examine these two element in effective manner so that
negative impact will be minimise and positive can gain. Furthermore, there are mainly three type
of organisation i.e., public, private and voluntary it has been analyse through above discussion.
Every company have their place in business environment as in private limited 50% of share are
owned by owner on the other hand maximum number of shares are hold by government within
public company. Along with this, voluntary organisations are one which work for the well-being
of society as well as their motive is not to generate revenue.

REFERENCES
Books and Journal
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Online
Nike’s Organizational Structure, 2018.[Online].Available
through<https://advergize.com/business/nikes-organizational-structure-the-pros-cons/>
Nike organisational structure, 2019.[Online].Available
through<https://www.slideshare.net/KaylaHarrington3/nike-presentation-69750317>
Marketing and its relationship with other business activities. 2019. [Online]. Available
through:<http://www.sanandres.esc.edu.ar/secondary/Marketing/page_14.htm>.

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