Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction
This is a Darden case study.This is a minicase, one of 10 in a set of short cases written to illustrate the business benefits companies realize through adopting sustainable business strategies. This minicase discusses the formation and implementation of Nike's sustainability strategy in the 1990s through 2006 including changes to product designs and supply chain policies.
Swot Analysis of "Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction" written by Andrea Larson, Jeff York includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Minicase Sustainability facing as an external strategic factors. Some of the topics covered in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction case study are - Strategic Management Strategies, Disruptive innovation, Entrepreneurship, Financial management, International business, Strategy, Supply chain, Sustainability, Technology and Organizational Development.
Some of the macro environment factors that can be used to understand the Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing,
cloud computing is disrupting traditional business models, increasing commodity prices, etc
Introduction to SWOT Analysis of Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Minicase Sustainability, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Minicase Sustainability operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction can be done for the following purposes –
1. Strategic planning using facts provided in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction case study
2. Improving business portfolio management of Minicase Sustainability
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Minicase Sustainability
Strengths Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Minicase Sustainability in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction Harvard Business Review case study are -
Organizational Resilience of Minicase Sustainability
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Minicase Sustainability does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Minicase Sustainability has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Minicase Sustainability is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Andrea Larson, Jeff York can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Sustainable margins compare to other players in Organizational Development industry
– Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction firm has clearly differentiated products in the market place. This has enabled Minicase Sustainability to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Minicase Sustainability to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Minicase Sustainability has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Minicase Sustainability has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to recruit top talent
– Minicase Sustainability is one of the leading recruiters in the industry. Managers in the Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Minicase Sustainability is present in almost all the verticals within the industry. This has provided firm in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High brand equity
– Minicase Sustainability has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Minicase Sustainability to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Minicase Sustainability is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Minicase Sustainability is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Minicase Sustainability in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Minicase Sustainability in the sector have low bargaining power. Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Minicase Sustainability to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Minicase Sustainability is one of the most innovative firm in sector. Manager in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction are -
Increasing silos among functional specialists
– The organizational structure of Minicase Sustainability is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Minicase Sustainability needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Minicase Sustainability to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Minicase Sustainability has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Minicase Sustainability even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Lack of clear differentiation of Minicase Sustainability products
– To increase the profitability and margins on the products, Minicase Sustainability needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, is just above the industry average. Minicase Sustainability needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Need for greater diversity
– Minicase Sustainability has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Interest costs
– Compare to the competition, Minicase Sustainability has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Capital Spending Reduction
– Even during the low interest decade, Minicase Sustainability has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, in the dynamic environment Minicase Sustainability has struggled to respond to the nimble upstart competition. Minicase Sustainability has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Andrea Larson, Jeff York suggests that, Minicase Sustainability is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High cash cycle compare to competitors
Minicase Sustainability has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Workers concerns about automation
– As automation is fast increasing in the segment, Minicase Sustainability needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Opportunities Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction are -
Loyalty marketing
– Minicase Sustainability has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Minicase Sustainability can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Minicase Sustainability in the consumer business. Now Minicase Sustainability can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Minicase Sustainability to increase its market reach. Minicase Sustainability will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Creating value in data economy
– The success of analytics program of Minicase Sustainability has opened avenues for new revenue streams for the organization in the industry. This can help Minicase Sustainability to build a more holistic ecosystem as suggested in the Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction case study. Minicase Sustainability can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Minicase Sustainability can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Minicase Sustainability is facing challenges because of the dominance of functional experts in the organization. Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Manufacturing automation
– Minicase Sustainability can use the latest technology developments to improve its manufacturing and designing process in Organizational Development segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Buying journey improvements
– Minicase Sustainability can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Learning at scale
– Online learning technologies has now opened space for Minicase Sustainability to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Building a culture of innovation
– managers at Minicase Sustainability can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Organizational Development segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Minicase Sustainability can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Minicase Sustainability has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Minicase Sustainability to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction are -
Technology acceleration in Forth Industrial Revolution
– Minicase Sustainability has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Minicase Sustainability needs to keep up with the evolution of technology in the Organizational Development sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High dependence on third party suppliers
– Minicase Sustainability high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, Minicase Sustainability may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Regulatory challenges
– Minicase Sustainability needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Organizational Development industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Minicase Sustainability in the Organizational Development industry. The Organizational Development industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Minicase Sustainability with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Minicase Sustainability is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Minicase Sustainability can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Minicase Sustainability needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Minicase Sustainability can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Minicase Sustainability in the Organizational Development sector and impact the bottomline of the organization.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Minicase Sustainability.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Minicase Sustainability can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction .
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Minicase Sustainability needs to make to build a sustainable competitive advantage.
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