Nike (originally named Blue Ribbon Sports) was founded in 1964 by Phil Knight and his University of Oregon track Coach Bill Bowerman. It was born as a business project of Knights while he was in Stanford. The idea was to import shoes from Japan into the U. S. Up until this point the majority of shoes were imported from Germany. By importing the shoes from Japan the cost would drastically be improved because of labor savings. Nike, with the ingenious incorporation of famous sponsors, quickly grew to 168 stores in the United States and a presence in over 160 Countries.
In the early 1990’s Nike came into the spotlight over allegations of human rights and labor violations in the third-world countries it was manufacturing in. Some of the allegations included child labor breaches which were already in the spotlight at the time from manufacturing of other product lines. Other stories were of beating, horrid work conditions, and abuse. Nike initially chose to address the scandal with a “damage control” attitude. This led to public outcry and the protesting of its stores.
Sports figures, which were the source of the majority of Nike’s publicity, began to separate themselves from the company. Retail stores also began to stop carrying the brand and separating themselves from the horrid stories. As a result of the bad publicity, and with shrinking sales, the company decided to take a new approach. The company started many new projects to bring about change in its factories and even took it a step forward and started to try and become an environmentally friendly company at the same time. 1. Why did Nike fail to address corporate social responsibility early on?
The Essay on Nike Company
History Nike in 1962, started as Blue Ribbon Sports, as its Founder member, Phil Knight thought there was a market for athletic shoes designed by athletes for athletes. In the year 1964, Bill Bowerman, Knight’s track coach & Phil Knight joined hands together & NIKE Inc. was co-founded with headquarters in Beaverton, Oregon. Nike’s grassroots strategy was born of low capital and ...
Nike subcontracted many of its manufacturing jobs to local overseas companies. These companies did not have any means of discloser over its workers environment or age. Nike also had a “don’t ask don’t tell” mentality. As long as the profits were rolling in and the subcontracted manufacturers were keeping the margin down that is all they really looked at. The company decided to initially take a defensive “it’s not our fault” stance. As public outcry increased the were pressured into a “We’ll do only what we have to” stance and eventually decided to blame it on the industry as a whole.
The proper thing to do in my opinion would have been to address the issue with the same aggression as the public was demonstrating. Let the public know that they initially had no control over the manufacturers in the other countries and begin to assure the public that the values of those companies are not the values that Nike believes in. From there they could further move to address stopping the labor issues and forming a system to make sure it never happens again. This is partly what Nike ended up doing in the long run anyway, it just took longer. 2.
Evaluate Nike’s response to societal and consumer concerns about its contract manufacturing. I believe that Nike really believed that they had no blame in labor the conditions in the outside manufacturers. The way that Nike looked at it they were paying the manufacturers to do a job by whatever means they had at their disposal and how ever it was done had nothing at all to do with their company because it was out of their control. Whether this was the case or not Nike should have anticipated the backlash and public outcry that would follow. 3. What are the challenges facing Nike in the future.
Nike has now positioned itself as a force for good in the fight for worker rights and equality. They have also positioned themselves as a positive force in the green movement. Nike’s biggest challenge comes from the changing world market and temptations to slip back into its old mentality. With a rise in wages in all countries around the world and shrinking bottom lines everywhere Nike must also be certain to keep an eye on their subcontractors in this changing environment so another incident like the Honduras layoff scandal does not happen again.
The Term Paper on Nike Company Profile United States
I- COMPANY PROFILE 1) Nikes overview Nike Inc. was incorporated in 1968 under the laws of the state of Oregon, USA. The general business activities can be described as follows: design, development, and global marketing of high quality footwear, equipment and accessory products. Nike is the largest seller of athletic footwear and athletic apparel in the world. The Nike swoosh is one of the most ...
Personal Opinion: I think Doug Guthrie said it best in his article in Forbes magazine on the subject Building Sustainable and Ethical Supply Chains: : “The lessons learned from the Nike experience have a particular appeal in 2012. After all, the world has shrunk considerably in the last decade, and the workplace abuses on the far side of the globe can come back home with a swift and uncompromising speed.
Additionally CSR and corporate citizenship has taken hold, not only in the imaginations of academics but also in the real world inhabited by consumers. ” Doug know, as I do, that with the opening of the global market comes higher wages in third world companies and thus a more competitive attitude at home. I believe that Nike is on the right path and that not only are they doing a good job at watching their labor force, but their social responsibility push is a pioneering move on their part.
No other shoe manufacturer of their size is addressing the issues of waste and pollution in the same ways as Nike. References Guthrie, Doug. “Building Sustainable and Ethical Supply Chains. ” Forbes. com. N. p. , 09 Mar. 2012. Web. 10 Apr. 2013. <http://www. forbes. com/sites/dougguthrie/2012/03/09/building-sustainable-and-ethical-supply-chains/>. Ferrell, Fraedrich, and Ferrell. Business Ethics Ninth Edition. Mason, OH: Centrage Learning, 2013. Print.
