LASA 2—Evaluating a Supply Chain

Running Head: CONDUCTING AN ORGANISATIONAL ASSESSMENT 1

AN ORGANISATIONAL ASSESSMENT 12

LASA 1—Conducting An Organizational Assessment

Sean Markl

Argosy University

Operational Management

September 26, 2018

There are very many issues that determine whether an organization is going to fail or succeed in a given environment. Competition keeps increasing and the dynamics of doing business change with time. Consumer demands and preferences as well as government’s laws and regulations for doing business also change with time. An overall organizational success encompasses the inclusion of all the stakeholders such as employees and shareholders, and the harmonization of its goals and missions. With all these in mind, an organization ought to develop an effective structure, a powerful strategy and a good culture since its success or failure heavily depends on these factors more than anything else.

The Organizational Structure

This is the arrangement or the framework by which different activities are laid out and how individual or team work are coordinated in an organization. To achieve goals and different objectives of the organization all the activities and roles in an organization should be well coordinated, controlled and managed. The organization structure is a tool that should never be neglected. It helps to show who does what and who reports to whom (Thompson, 2018). These reporting relationships are very valuable and result to unity of command.

A good organization structure eases the flow of formal communications within the organization. This is because it outlines the channels of communication and how different actions of the stakeholders are related or linked together. Structure helps different personnel in the organization to work together for a common goal.

There is no structure that can be said to be the best. For example, an organization needs to consider its strategy and have clearly outlined responsibilities and roles, clear communication channels and defined procedures in order to select a good structure. A good structure helps the business to:

· Improve staff morale.

· Avoid excessive meetings

· Make quick and effective decisions

· Reduce conflict among teams and departments

· Have coordination

· Reduce costs

· Be responsive to changes

The Strategy

This is a combination of all the plans, ideas and actions that an organization intends to take in order to achieve set goals. The strategic plans may be for short term, medium term or even long-term goals. The strategy maps the route that the business will take in order to achieve its goals and visions.

With time the strategy of a business can change even if the goals remain the same. It does not have to be inflexible. This allows the business to incorporate changes in the internal and external environment and also take advantage of new opportunities that may arise in the course of running the organization. An organization needs a strategy for various reasons as situations may demand (Katzenbach, Oelschlegel, & Thomas, 2016). For example, a growth strategy for helping the business to expand or a market entry strategy for penetrating into a new market.

The strategies should be SMART. This means that they should be very specific in a way that eliminates uncertainties, measurable, achievable, realistic and time-bound. Measurability helps to quantify what has been achieved. Being achievable makes it possible to believe in them. Realism means that one has to consider what is reasonable and viable. It helps to avoid wastage of resources on unrealistic things.

Having time bound strategies helps one to know what should be done and at what time. The organization can increase its speed if it is lagging behind. With these characteristics the strategy becomes very effective.

The Organizational Culture.

It refers to the shared assumptions, different ways of interacting, systems, values, assumptions, symbols, developed behaviors, any jargons and beliefs that make the organization’s environment (Needle, 2004). This defines the relationship between people, their interaction and way of doing things (The Tipster, 2018). A culture gives the stakeholders in an organization a sense of belonging.

Organizational culture develops with time. It is not a thing that happens overnight. Its change is also gradual. A culture determines the productivity of the workforce and the way an organization responds to environmental factors. A good one ensures that the organization is more productive, has a conducive environment for the employees and a positive lasting effect in the society.

Nike’s Assessment

Nike is a multinational enterprise that focuses mainly in the research, designing, improvement, manufacturing, marketing and sale of goods and services related to footwear, clothes, fitness gadgets and accessories. The headquarters of Nike are in Beaverton. Currently Nike is one the leading companies in the apparel and footwear line of business. It has a strong presence in several markets in the world.

The company has made tremendous achievements and growth since its incorporation in the 1964by Bill Bowerman with his business partner Phil Knight. The share price has increased, and the revenues have more than doubled. Through the ever-changing environment, the business has continued to evolve and outsmart the competitors. Nike has become one of the famous brands in the world. This has been as a result of a good combination of an effective global strategy, a well-defined structure and a reasonable organizational culture.

The Business Strategy and Global Competitive Plan

When it started its operations, the company’s major goal was to serve the American populace with shoes of low cost yet of high quality by buying and later distributing Japanese athletic shoes. The American shoe industry was largely dominated by German products. The company operated this way until they were able to start a local manufacturing plant.

In the strategic plan, the main target market for Nike has always been the athletes (Enderle et al., 2000). They supply them with shoes, clothing, various fitness and sporting equipment. The strategy has always proven to be fruitful because the demand for sporting goods and equipment in the world has been increasing steadily over the years. The athletes have also gained trust in the brand and recognized it as one that offers high quality. The main market is the United States where many people buy the footwear and related merchandise.

Another noticeable strategy is the establishment of a global presence. Nike has opened stores in many nations in different continents in the world. It has also signed business contracts with many suppliers and distributers in the world. This has enabled it to reach many people and its sales. The company has even online channels where consumers can access different products. Availability is key in any business and Nike has mastered the art.

Nike has also put emphasis on constant research, development and innovation. This strategy enables the business to keep up with market trends. It conducts research on consumer trends and behavior in order to beat competition. For instance, it developed Nike+ to deliver a high technology experience to consumers. Therefore, the consumers find this brand to be relevant and hard to do without.

Having meaningful partnerships is a vital strategy. Nike partners with different marketing, manufacturing and service companies in order to deliver a first-class experience. The Nike+ running sensor for instance, was a collaboration with Apple, which is a leading technological company. This strategy has enabled the company to overcome barriers in fields where it does not have enough knowledge or experience.

Market segmentation as a marketing strategy. Nike has segmented its market into different segments based on demographical, psychographic and geographical factors. For long, this has helped the company to serve the needs, demands and preferences of the customers. What one market needs may not be what the other one needs and therefore, segmentation proves to be a useful strategy.

In addition, Nike has target strategies. These include having a robust marketing to ensure that the target consumers are aware of the products and even product customization (Jain, 2018). For instance, Michael Jordan got a chance to have Jordan shoes. The customers find it easy to associate with the brand and also relate success with it.

Outsourcing strategies. It relies on different countries and manufacturing companies to get different services done and products delivered. These contracts are essential in helping the business to enter new markets, get raw materials and conduct research. It also helps to avoid having a huge operational cost burden.

SWOT Analysis

The Strengths

· It has a strong distribution channel. This helps to reach a wider market.

· It has a stable financial position. It maintains a minimal long term debt.

· Innovative product designs. The shoes and other products are well designed and have unique features.

· A wide product range

· Strong marketing team

· Several market segments

· Good corporate governance and experienced management

Weaknesses

· High reliance on the shoes business

· Experiences bad reputation in some parts

· Higher price tag on products as compared to competitors

Opportunities

· It can promote products by sponsoring major sports events

· Can increase demand by developing new fashion and trends

· Can increase its products range

· Focus more on women

Threats

· High competition as competitors continue to be aggressive

· Consumers are becoming more sensitive to prices

· Bad reputation in some markets

· Trade barriers and high tariffs between countries

External Environment Assessment using PESTLE Model

The organization has several factors that pose threats to it and also create some opportunities for the business.

Political factors

These factors include government regulations and policies regarding business. They can be favorable or unfavorable to a business. Some governments such as the Chinese government have imposed trade barriers and restrictions that hinder business operations. There are high international trading tariffs, many requirements for multinational company’s employees and also some price control measures. The political factors may prevent Nike’s expansion program.

Economic factors

There are periods of recession and booms in different markets. The purchasing power of some customers is low is some markets due to adverse economic conditions like inflation. Nike’s products are highly taxed in some markets, making them to be very expensive and unaffordable. In some emerging markets, the company gets tax reliefs and incentives.

Social factors

The cultural norms, demographical factors, attitude of the people towards a commodity and customers tastes are very essential to any business. Nike is sometimes seen as a product of the rich by some. This makes it try to create low cost products too. Where Nike has a bad reputation, the customers have a negative attitude towards it.

Technological factors

Nike has always stayed a step ahead in technological advancement. The emergence of new technology has the ability to keep a business out of operation. Processes like automation and ecommerce have greatly changed how customers behave. Nike devotes a lot of funds into research and development.

Legal issues

The major issues to do with legislature involve customers and employee’s protection, meeting health and safety standards and licensing. Nike has sometimes been criticized for overpricing its products and also underpaying some of its workforce. These legal issues tarnish a brand’s name. They also lead to losses in legal battles.

Ecological or environmental factors

Every business has to refrain from polluting the environment. The organization has to adopt green practices and observe waste management rules. Failure to do this not only destroys the environment but also leads to huge penalties to the company for doing so.

Nike’s Organization Structure

Nike has a very attractive and unique organization structure. Part of its success is due to the good organizational structure and it is as shown below. ("Org Chart Nike," 2018).

Chief Executive Officer	C.FO	Regional CFOs, tax, corporate controller
	COO	Sustainability, regional COOs, investor relations & treasurer
	DESIGN
	MARKETING	Chief digital officer, brand creative & innovation officer, global brand marketing
	ADMIN & LEGAL
	HR
	Global Sports Marketing
	CIO
	CATEGORIES& products
	Secretary
	Apparel business
	Consumer & market place

The Organizations business process

The business process design is concerned with coming up with a cost-effective way of performing different business tasks (Bryce, 2015).

Nike has a new product development team. The explore team understands the needs of the consumer and tries to come up with something that best fits that. This helps to meet the needs of target markets (Liu, 2016).

Product innovation leaders make sure they come up with new designs. They also keep up with trends in the market. The new product has to meet set standards in order to compete effectively. The product is then given to some athletes for testing. If the process meets standards and is fit, it is launched in the market. They keep checking the areas that need improvement.

Potential Ethical Issues.

The business has been criticized severally because giving poor payments to employees. This makes the staff to have low morale and they may fail to execute their duties effectively. The company should clear the air and tell the public that indeed they pay their employees well.

Nike has severally experienced bad reputation. For instance, in 1990, it was accused of child labor. It was later connected to the striking of a Chinese shoe factory. This affects how people view the brand and its products. To overcome this, the company should undertake more social corporate responsibility actions in order to change people’s perception. They should also operate within the laws always.

References

Bryce, T. (2015). Understanding Business Process Design. Retrieved September 22, 2018, from https://www.modernanalyst.com/Resources/Articles/tabid/115/ID/3389/Understanding-Business-Process-Design.aspx

Enderle, K., Hirsch, D., Micka, L., Saving, B., Shah, S., &Szerwinski, T. (2000, March 14). Strategic Analysis of Nike, Inc. Retrieved from http://condor.depaul.edu/aalmaney/StrategicAnalysisofNike.htm

Jain, A. (2018). International Marketing Strategy of Nike Inc. Retrieved September 22, 2018, from https://www.slideshare.net/AnanyaJain10/international-marketing-strategy-of-nike-inc

Katzenbach, J., Oelschlegel, C., & Thomas, J. (2016, February 15). 10 Principles of Organizational Culture. Retrieved September 22, 2018, from https://www.strategy-business.com/article/10-Principles-of-Organizational-Culture?gko=71d2f

Liu, M. (2016, April 12). THE NEW PRODUCT DEVELOPMENT PROCESS OF NIKE. Retrieved September 22, 2018, from https://prezi.com/cgkyx6jootgw/the-new-product-development-process-of-nike/

Needle, D. (2004). Business in context: An introduction to business and its environment. London: International Thomson Business.

Org Chart Nike. (2018, September 21). Retrieved September 22, 2018, from https://www.theofficialboard.com/org-chart/nike

The Tipster. (2018, January 23). 4 Types of Organizational Culture - ArtsFwd. Retrieved September 22, 2018, from http://artsfwd.org/4-types-org-culture/

Thompson, A. (2018, September 8). Nike Inc. Organizational Structure Characteristics (Analysis) - Panmore Institute. Retrieved September 22, 2018, from http://panmore.com/nike-inc-organizational-structure-characteristics-analysis

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