Nike Considered: Getting Traction on Sustainability: Strategic Management Assignment, Malaysia

We needed to adopt the Considered principles into mainstream product, which is now happening with the Jordan XX3. After many years that’s the Holy Grail that we’re finally starting to get traction on. We recognized in the 1990s that design was the key, but we didn’t have the skill-set in the environmental team to translate what we knew about environmental issues in a way that designers understood. Part of the problem was we didn’t have tools in place. But now what you see with the Considered Index is that for the first time, we have a tool that helps designers make environmental choices about how they design their product.

Scenario planning on Corporate Responsibility-related global trends such as water, health, and energy, alongside increasing worldwide concern about climate change, had fueled Nike’s worries about the company’s supply chain. As with most industries, Nike realized that it was heavily dependent on oil for materials and fossil fuel energy, and was potentially exposed to high oil prices and looming carbon restrictions from anti-climate change regulation. Meanwhile its waste production and use of toxic materials and water also posed major risks.

In December 2004, incoming Corporate Responsibility (CR) VP Hannah Jones recognized that Nike needed to be strategic in its response to its environmental impacts, keeping in mind how ineffective Nike’s initial reaction to accusations of abuse at its contracted supplier factories had been in the 1990s. But how could Nike best do this? Was Considered a good first step? What else might be required?

Nike2
In 2008, with nearly 50,000 product styles across its three product lines, Nike Inc., which included the Nike, Converse, Cole Haan, Umbro, and Hurley brands, was the world’s leading branded athletic footwear, apparel, and equipment company. The Nike brand, a subsidiary of Nike Inc., was organized around more than 30 product categories responsible for designing, developing, and marketing products for consumer niches, such as Running and Basketball. Categories housed key support functions like product engineers and innovators, and maintained connections to Nike’s factory liaison offices and sales and marketing functions. Categories depended on factories’ expertise in managing production processes, which allowed them to focus on product creation and marketing.