Managing Nike

In the case study Nike: Managing Ethical Missteps and Seizing Opportunity, we explore the story of Nike: the world’s leading seller of athletic wear. As some may know and others may not, Nike was actually started (similar to FedEx by Fred Smith) from a college paper by Phil Knight which conceptualized importing athletic shoes from Japan into the United States. In 1964, Knight teamed up with a colleague and launched Blue Ribbon Sports, a distributor of Japanese athletic shoes which also marketed its own brand for sale in the U.S. After about seven years in business, Blue Ribbon Sports broke camp with its Japanese supplier and the company we know today as Nike came into existence. The rest of the story is now one for the history books. Nike’s rise to fame and prominence was not without challenges, however. As the company grew and expanded into regions all over the world, concerns developed in regard to labor and human rights infringements, in addition to allegations of ethical misbehavior. In essence, Nike subcontracted the manufacturing of its shoes in many countries where workers did not enjoy the same rights and working conditions as their counter-parts in the United States; hence, reports of meager working conditions and even child labor began to surface. Even with viable company regulations, the sheer locations of many of these manufacturing plants (in third-world countries) created quite the enforcement issue. To make matters worse, in the 1990s labor rights activists and the media began acts of protest against Nike’s violations, damaging the company’s reputation. Then, in 1996, the ‘big one” hit. Life magazine published an article with photographs of Pakistani children stitching tennis balls for Nike and a few other companies. Needless to say, the stark images dealt a severe blow to Nike’s corporate reputation and sales began to plummet. Customers who had held the Nike banner high began to withdraw their support of the company. Critics led anti-Nike

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