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Nike Case Study

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University of Phoenix
Nana Offei
MGT/448 Global Business Strategies
Case Study Nike: The Sweatshop Debate
July 5, 2012
Professor, Marc Mosko

Nike, the sweatshop debate
Nike Inc. was started by Bill Bowerman and Phil Knight, who met each other in 1957 Before going into business, Knight became a certified public Accountant (CPA) the original Nike Inc. was founded in 1964 by Phil Knight and his friend Bill Bowerman with a collective investment of 1000 to fund the business tries (Nike repository, 2010)
The company began with Bill and Phil being local distributors for the Onitsuka Tiger footwear brand now own by Asics footwear, Bill and Phil did business out of their cars at local track meet and sporting event to athletes in the vicinity of the University of Oregon, the first sport retail store open in California in 1966 as where the company profit began to grow they realized that their financial limits imposed by Onitsuka Tiger would limited their long team profits (Nike repository, 2010) This paper will describe the legal culture ,and ethical challenge that confront the global business as personated on the case study, in addition the paper will determine the various roles that the host government played in global business operation .at the end it will summarize the strategic and operational challenges facing global managers illustration in Nike organization

Global business doesn’t come without challenges
Nike organization plan to become a global body and that will help the company to increase their dividend unfortunately company like Nike will face obstacles before establishing as a successful business in oversea. Some of the issues of concern are child labor law and wages that will effect on sale. Because of this, most extensively recognized companies have presented various cases to defend their positions on conducting business in the foreign countries example is Nike sweatshop labor case that enthused up an argument over ethical business practices.
Although Nike has attempted to recuperate from the terrible depress that the company received about the sweatshops, the organization is still struggle to overcome the depressing feelings from people across the United States. The legal cultural and ethical challenges of this case understanding of the roles that the host government’s play strategic and operational challenges to face the important to gain understanding of the issues .Most people might define Nike as recognizable products that offered, individuals option to customized available in the Nike store online, Nike Sportswear, Nike Women, Nike Basketball, and Nike Football. These products, among others, have led Nike to a profit about $18 billion in 2006 and a catchy just Do it, slogan (Hill C, 2009)
As a result, protestors of globalization and human rights activists criticized Nike for taking advantage of the workers overseas and placing them in a destructive working environment. Moreover, the fact that Nike was making billions of dollars and still failed to provide a safe working environment only made matters worse.
After Nike realizes it was the objective of several protest and complaints next to globalization, it recognized the need for safer work environment and faithfulness to certain standards for each of the overseas factories. The factory workers were forced to work exceptionally long hours to accomplish quotas and had to follow strict rules during work for below minimum pay despite having over 70 to 80% of the employees in Vietnam suffer from respiratory problems( Hill C, 2009)
According to Charles (2009) the legal, ethical, and cultural challenges began to add up for Nike and it was time for the company to tackle them. Even though the majority of challenge Nike had to overcome involved ethical issues and debates although Nike was providing jobs to those who are unemployed it was paying a meager $1.50 a day to Vietnam Factory workers when the living wage is at minimum amount of $2.5 or 3 dollars a day” Nike may perhaps avoid this challenge by paying each employee or worker the living wage of the country he or she lives in to purchase necessary items. Furthermore, the living wage is a cultural hope which Nike unsuccessful to meet that led to complaint. (Hill C, 2009) The deliberate was in surplus of the unsafe conditions; Nike was providing its factory workers while his knowledgeable continual increase in profits. Nike in addition criticize for disappointment to go after child labor laws by hiring children who were not allowed to work and forcing them to work overtime for below minimal pay. For instance, according to Global Exchange, in one factory, owned by a Japans subcontractor for Nike, workers as young as 14 and 15 years earning as little at 20 cents an hour of working up to 17 or something’s 18 hours daily in compulsory by force (Hill C, 2009)
The planned and operational challenges Nike faces are huge and will need a lot of time and endeavor. It factual because the operational practices and strategies that Nike beforehand adhere was no longer effective” rather, than those that he practices and began to hold back to its success. One thing that operational challenge Nike to faces is the development of a strict monitoring system in its factories in overseas. On the other hand, hiring a firm to ensure accurate accounting reports are produced is a strategic challenge. Furthermore, determining a country to set up an additional factory in is both a strategic and operational challenge. Nike faces several challenges; however, it can achieve frequent success through an effective operational and strategic plan.
Therefore, the factories and sweatshops established foreign country by Nike launched a debate regarding whether Nike was in compliance or violation of ethical guidelines and regulations. Despite several attempts, Nike is still the focus of protests regarding violation of child labor laws and unsafe working environments. Furthermore, numerous legislative organizations have worked with Nike to ensure safe and ethical business practices and to monitor the sweatshops Nike established foreign country. Consequently, Nike was forced to change its operational and strategic plans radically in order to stay successful and mollify employment and civil rights unions. The case of the Nike sweatshops demonstrated how difficult it can be for a business to become global because of the different rules and regulations established by foreign nation. (Hill C, 2009)

Reference pages
Nike repository (2010) Nike, Inc. company history and information retrieve from nikerpository.com
Hill C, (2009) international business competing in the global marketplace New York McGraw- Hill/Irwin

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