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Strategic Human Resource Management

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Sylvester Chng

on 3 October 2013

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Transcript of Strategic Human Resource Management

Strategic Human Resource Management
The Process of Strategic Human Resource Management

External Factor- PESTLE
Political Analysis
Nike has been aided greatly by the US policies
Us have low interest rates, international competitiveness of the tax system and stable currency conditions

Economic Analysis
Economic recession
Demand decrease
Society Analysis

Increasing number of people joining fitness clubs resulting in higher demand of Nike products.
Condition of labor and factory at different locations

Technology Analysis

Advance research and development
Efficient marketing and technology tactics

Legal Analysis

Checking the local laws before entering the country

External Factors
Organizational Factors
MNE Structure
Firm Size and Maturity
MNE Strategy
MNE Culture
HR Function
Global corporate HR Role
HR practices
Crisis management and coordination
MNE Performance
Financial performance
Social performance
Enterprise resilience
Environmental Analysis
ISO certified for global environment, pollution and carbon foot prints tracing point of view
Strong believer of green environment
Strategic Human Resource Management
Nike is without a doubt one of the world’s top sports and fitness companies, and has a legacy which dates back to 1962 when they first arrived on the scene under the name of Blue Ribbon Sports. Today Nike is known for their top of the line sports apparel and athletic shoes.
Organization Factors
Global contact factory workers by region supplying

MNE Performance
MNE Performance - Financial performance
MNE Performance - Enterprise resilience
Divisional structures
Functional structures
Matrix Organizational Structure
Organizational Factors - MNE Structure
Organizational Factors - Firm Size and maturity
Three foundational priorities
Diversity, Inclusion and Innovation
Empower inclusive culture
Inspire ideas

Open and creative culture
Organizational Factors - MNE Strategy
Organizational Factors - MNE culture
HR Function
HR Practices
HR Function - Crisis management
In 1996, Nike was embroiled in a scandal when allegations were brought to light regarding child labor used in offshore factories around the globe. In 1997, Nike was in violation of OSHA standards in Vietnam with workers allegedly exposed to toxic fumes. In 1996, Nike was embroiled in a scandal when allegations were brought to light regarding child labor used in offshore factories around the globe. In 1997, Nike was in violation of OSHA standards in Vietnam with workers allegedly exposed to toxic fumes. [1]
At the time, Nike CEO Phil Knight issued a statement identifying the ways in which Nike was going to make things better by creating improved working conditions. The six promises were:
Involves the execution of well-coordinated actions to control the damage and preserve or restore public confidence in the system under crisis.
The process of preparing for and responding to an unpredictable negative event to prevent it from escalating into an even bigger problem
Nike and Crisis Management
The six promises were:

Nike was to meet U.S. Occupational Safety and Health Administration’s (OSHA) standards in indoor air quality.

The minimum age for Nike factory workers will be raised to 18 for footwear factories and 16 for apparel factories.

Nike will include non-government organizations in its factory monitoring, with summaries of that monitoring released to the public.

Nike will expand its worker education program, making free high school equivalency courses available to all workers in Nike footwear factories.

Nike will expand its micro-enterprise loan program to benefit four thousand families in Vietnam, Indonesia, Pakistan, and Thailand.
In 1996, Nike was embroiled in a exploitations of child labor.

In 1997, Nike was in violation of OSHA standards in Vietnam with workers allegedly exposed to toxic.

Nike CEO Phil Knight took steps to make things better by creating improved working conditions.

1. Human resource planning
Develop our premiere talent brand via the relentless human resources
2. Staffing
NIKE directly employs more than 30,000 people across the globe
Nike contracts with manufacturers that employ more than 800,000 workers.
3. Compensation and benefits
4. Training and Development
Provide extensive safety training
Providing learning and development opportunities
Talent strategy focuses on critical assignment planning, manager accountability for coaching and mentoring, and a variety of innovative approaches to individual and team learning.
HR Function - HR Practices
Health insurance Life and accident insurance Disability insurance
Retirement savings plan with a company contribution
Employee stock purchase plan (15 percent discount)
Paid vacations and holidays
Paid sabbaticals
Product discounts
Onsite fitness center/fitness discounts
Transportation allowance/discount
Tuition assistance
Nike celebrate and reward successful employee results through excellent benefits and rewards.
Nike's business fell very badly in China however Nike raised its price according to the brand's strength
Nike became committed to the soccer branding by doing endorsement which in the later years helped the brand kickstart in its international business.

Nike ran into a software glitch in its demand-planning engine that called up factory orders for thousands fewer Air Jordans than the market needed.

Nike had the resilience to work through these setbacks on their path to creating better enterprise systems

Business Level Strategy
Nike's revenue for the year of 2011 according to our research was $20.86 billion.

United states,Europe,The Middle East and Africa accounting for 34% of its total revenue.

Massive advertising which it spends about 12.4% of its revenue.

During the Beijing 2008 Olympics and European Football Championship,Nike sales soared up by 39%

Even though Nike's USA market was slowing down,its global markets led to an increase of 19% and 26% in revenue.

Investments in foreign markets
An integrated and coordinated set of commitments and actions the firm uses to gain a competitive advantage by exploiting core competencies in product markets
Nike's Cost Leadership Strategy
Involves providing products and services that are less expensive than those of competitors

Low cost access to factors of production.
Differentiation strategy
Aims to develop and market unique products for different customer segments. Firm has clear competitive advantages, and can sustain an expensive advertising campaign

Manufactures sports goods for three different Demographics
Offer variety of footwear and all sorts of sports accessories and equipment
Licenses to sell other products under NIKE brand names.

Strategic HRM focuses on actions that differentiate the firm from its competitors

The use of planning;

A coherent approach to the design and management of personnel
Systems based on an employment policy and workforce strategy
Matching HRM activities and policies to some explicit business strategy
Seeing the people of the organization as a ‘strategic resource’

Thank you for your attention
Organizational structure determines how the roles, power and responsibilities are assigned, controlled, and coordinated, and how information flows between the different levels of management.

Ting Ting
Li Shan
Consumer reaction
Organizational Factors - MNE Strategy
Common form of protest to the insufficient factory conditions by consumers include
Hunger strikes
MNE Performance - Social performance
Pursuing corporate social performance is also one way in which firms can differentiate themselves
Nike became an industry leader in promoting better working conditions in apparel and footwear factories in Asia and elsewhere after it was targeted.
Nike has also decided to look into environmental factors by reducing C02 emissions in each of its shoes by 20% and by using recyclable materials.
Nike also helps in the welfare of the society by organising Nike Women's Marathon for the Leukemia & Lymphoma Society.

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