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 - – there is backlash against globalization, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing commodity prices, increasing energy 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 -
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.
Ability to lead change in Organizational Development field
– Minicase Sustainability is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Minicase Sustainability in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Minicase Sustainability are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Minicase Sustainability digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Minicase Sustainability has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
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.
Training and development
– Minicase Sustainability has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
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.
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.
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.
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.
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.
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 -
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.
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.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Minicase Sustainability supply chain. Even after few cautionary changes mentioned in the HBR case study - Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Minicase Sustainability vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Minicase Sustainability, firm in the HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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.
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.
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.
No frontier risks strategy
– After analyzing the HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Aligning sales with marketing
– It come across in the case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction can leverage the sales team experience to cultivate customer relationships as Minicase Sustainability is planning to shift buying processes online.
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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Nike: Moving Down the Sustainability Track Through Chemical Substitution and Waste Reduction, it seems that the employees of Minicase Sustainability don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
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 -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Minicase Sustainability can use these opportunities to build new business models that can help the communities that Minicase Sustainability operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Minicase Sustainability to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Minicase Sustainability can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Minicase Sustainability can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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.
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.
Developing new processes and practices
– Minicase Sustainability can develop new processes and procedures in Organizational Development industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Minicase Sustainability to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Minicase Sustainability to hire the very best people irrespective of their geographical location.
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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Minicase Sustainability can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
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 -
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 .
Stagnating economy with rate increase
– Minicase Sustainability can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
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.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Minicase Sustainability needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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.
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.
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.
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.
Increasing wage structure of Minicase Sustainability
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins 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 .
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
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.
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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