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Hitting the Wall: Nike & International Labor Practices Presented by: Arif Husain Jerry Croke Josh Quinton Ashley White Organizational Strategy: Business 7000 September 20, 2006 What is Nike? Champion in the sport and apparel industry Well-recognized brand in every corner of the globe
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Organizational Strategy: Business 7000
September 20, 2006
Outsourcing all manufacturing
No dedicated manufacturing lines
Low cost manufacturing
Independent (arms length) contracting factories
One of the World’s first “Virtual Corporations”
Pour all money saved into marketing
Through continuous waves of protests resulting in negative publicity for Nike on its international labor standards, complimented with a lack of responsiveness and action on Nike’s part, what is the best strategy Nike must implement to reposition itself as a champion in the global sports and apparel industry
In 1997, a 23 year-old Vietnamese woman died while making sneakers. As she was trimming synthetic soles in a Nike contracting factory, a co-worker’s machine broke, spraying metal parts across the factory floor and into her heart. She died instantly.
Is Nike an Ethical Corporation?
An Ethical Analysis of NIKE can use the following Tests:
Some Ethical Tests can help analyze NIKE case.
What can be done:
The Ventilation Test - Get a second opinion from a wise friend with no investment in the outcome (Pagano, 1987)
4. Understanding why children work, and allowing opportunities for growth and advancement
5. Ensuring transparency and accountability
What is a fair wage in Vietnam and Indonesia?
Should the wages increase?
Facts from the case:
SOCIAL POLITICAL ARENA
Private Organizations / NGO’s
Communities / Citizens
Joint Venture Partners and Alliances
Employees (including children)
Supply Chain / Manufacturing
Who did Nike sign its first contract with?
How much did a pair of Penny Hardaway
basketball sneakers cost?
How many years would it take an
Indonesian worker to make the equivalent of
Jordan’s endorsement deal?
How many workers did Nike layoff during its
first loss in 13 years?
How many strikes occurred in Indonesia in
What was the daily minimum wage of
workers in South Korea in 1991?
In what fiscal year did Nike have its first