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Global Business Design Championship 2013 – Nike – GIE 6087 – Team 2

Official entry for the Global Business Design Championship of 2013 in the category of the more than one billion dollar revenue, Submitted to Professor Benoît Montreuil, Global Business Design GIE-6087
by

Simon Lefebvre

on 24 October 2013

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Transcript of Global Business Design Championship 2013 – Nike – GIE 6087 – Team 2

Entry submitted to Professor



for the class
Global Business Design
GIE-6087

Faculté des sciences de l'administration
Université Laval
David Brouillette Karim Douieb








Simon Lefebvre Simon Nadeau
«Hello World.»
- Slogan to introduce Tiger Woods after signing him in 1996
History & Timeline
1964 - Blue Ribbon Sports is founded by runners and revolutionaries Bill Bowerman and Phil Knight, starting as a distributor for the Onitsuka Tiger footwear brand in U.S.A.

1971 - "Swoosh" logo designed for $35. Year-end revenues reach $1 million.

1972 - Blue Ribbon Sports founds Nike in response to Onitsuka's threat to takeover. Pronounced
Ni-Key, the company is named after the Greek goddess of Victory. Pretty relevant.

Late 1970s - Nike establishes headquarters in Beaverton, Oregon & expands internationally.
1988 - Launch of "Just Do It" campaign and the reputation for unique and inspiring ads & Revenues exceed $1.2 billion.

1990 - Niketown stores launched & Labor practices questions.

1992 - Nike’s first Code of Conduct published to guide practices in contract factories.

1993 - Nike launched its Reuse-A-Shoe program, allowing consumers to drop off any brand of wornout athletic shoes. Nike grinds the shoes and uses the recycled material and manufacturing scrap in new sports surfaces. Since its launch, Nike has recycled more than 25 million pairs of athletic shoes.
1995 - Nike started to manufacture its shoe boxes with 100% recycled cardboard.

1997 - Nike committed to fully phasing out SF6, a global warming gas used in Air-Sole cushioning units. Nike began to blend organic cotton into a range of t-shirts.

2004 - Hannah Jones assumes role as VP, Corporate Responsibility. Nike also developed an environmentally preferred rubber that contained 96% fewer toxins by weight than the original formulations. Then, Nike’s first retail introduction of apparel, the Men’s Fitness recycled polyester track suit, was made from 100% recycled polyester in a range of men’s fitness jackets and pants.

2005 - Considered Design was formed as an ethos of the company to create products that address environmental impact by reducing waste, increasing the use of environmentally preferred materials and eliminating toxins.
2006 - Mark Parker becomes CEO.

2008 - Nike launched the AIR JORDAN XX3, incorporating sustainability without sacrificing performance. That same year, the Air Pegasus 25, one of Nike’s most iconic running shoes, was designed to maximize efficiency.

2010 - GreenXchange launched and some of the world’s leading football (soccer) players wore the most environmentally friendly and technologically advanced jerseys on the pitch.

2012 - Implementation of Nike Materials Sustainability Index began. And, NIKE, Inc. announced a strategic partnership with DyeCoo Textile Systems B.V., developer and builder of the first commercially available waterless textile dyeing machine.
OVERVIEW THROUGH
THE TETRAHEDRON
BUSINESS MODEL
DESIGN
Character
PLAN
At the core of our business is a plan – our opportunities, our resources and our values. It’s who we are. What we believe. And how we get things done.
DESIGN
Form. Function. Superior performance. Minimal impact. While our designers always strive to create products that are faster, lighter and stronger, they also pay close attention to smarter.
MAKE
Ideas don’t become reality by magic. For a global business, it requires people, materials, tools, knowledge, skill and a whole lot of coordination. We contract with more than 900 factories globally to make products from our designs.
MOVE
We ship products wherever and whenever they are needed, to get to thousands of partners and millions of consumers around the world. Airplanes, boats, trucks and trains are the tools our transport providers use to overcome the obstacle of distance every day.
SELL
Nike operates more than 750 retail stores around the world across all our brands. Beyond selling products, each location strives to be a rewarding experience for its consumers and an asset to its community. The stores are in leased space. While NIKE and our Affiliate brands sell primarily through retail partners not owned by our company, our focus is on the impact of the selling we do in our own stores.
USE
Once you bring home your new shoes, shirt or shorts, a different footprint starts to take shape. This one belongs to you.
REUSE
Finding innovative ways to reuse our products – creating running tracks, sport courts and even new shoes and clothing helps minimize our impact on the environment. Good becomes better over time. And so do we.
- Experiences:
1. Collaboration is essential
2. Transparency is a strategic advantage
3. Sharing innovation does not require sacrificing competitive advantages
- Reasons to be:
1. Innovation to serve the athlete
2. Innovation to grow the company
3. Innovation to inspire the world
- Credo: For Nike, there is no finish line
- Hypothesis: Sustainability can positively impact and improve Nike's business and its growth potential. In this new world, resources are scarce, and sustainability is a business imperative.
- Mission: “To bring inspiration and innovation to every athlete in the world.” (And if you have a body, you are an athlete.)
- Values: Sustainability, Innovation, Transparency, Design
- Vision: Nike's vision is to build a sustainable business and create value for Nike and its stakeholders by decoupling profitable growth from constrained resources.
- Concept: Nike is maintaining a relentless focus on sustainable innovation, from evolutionary enhancements to disruptive shifts that can transform the industry.
- Metrics: 20,9 billion $ revenues in 2012 for a CAGR of 9,68% since 1991, First position in Global Market share of almost 20% in athletic footwear, followed by Adidas group at a little under 13,5%.
Offer
- Customers: Innovation, Very diversified line of products, Belonging to a brand, Quality, Transparency
- Elite athletes: Innovation, Quality, Sponsorship, Exposure, Strong brand image
- Investors: Stable and important growth, Sustainability, Strong image, Diversified portfolio of brands, Dividends, Company involvement in R&D, 600+ Patents
- Workers: Wages, Good conditions: Nike Manufacturing Index
- Global population: Sustainable business operations, Corporate Responsibility, Green oriented business, Reduce-Reuse-Recycle
Creation
- Nike creates the value it offers today by continuously designing innovative products sustainably.
- Nike creates and enhances its business model continuously by auditing its customers and factories in order to optimize every key aspect of its value chain
- Key competencies: Innovate, Design, Marketing
- Key processes: Manufacturing, Distributing, Marketing
- Strategic assets: Strong brand equity, Global network of suppliers, manufacturers and retailers, Famous athletes supported
- Technologies: Close the loop, Reduce-Reuse-Recycle
- Research & Develop novelty

- Elite athletes
- Customers
- Shareholders
- Board of directors
- Executives
- Key suppliers
- Companies owned through acquisitions ( Cole Haan, NikeGolf, Jordan, Hurley, Converse, Umbro)
- Employees and Workers
- Manufacturers and Factories
- Social actors
- Funded beneficiaries
Stakeholders
HOW DOES
QUALIFIES AS
HAVING ONE OF THE
BEST GLOBAL BUSINESS DESIGNS?
Five Facets of a Global Business Design
1. Global business design considers the world as the business’s terrain, the business as a world corporate citizen serving a world market, with bases, suppliers and partners distributed worldwide.

2. Global business design entails fundamental missions, reasons for being, visions that aim to significantly contribute to addressing globally important issues and solving globally important problems.

3. Global business design aims towards global performance in achieving its mission, notably encompassing a multi-stakeholder perspective and an economical, societal and environmental sustainability perspective.

4. Global business design exploit the incessant flow of possibilities offered by knowledge production and technological innovation, deeply engraining these in the fabrics of the business.

5. Global business design dynamically defines the business in a global, holistic, both comprehensive and deep way, seamlessly, efficiently and sustainably integrating how the business gets to market, sells, delivers, distributes, produces, supplies, innovates, finances itself, hires, learns, and so on.
First Facet
Global business design considers the world as the business’s terrain, the business as a world corporate citizen serving a world market, with bases, suppliers and partners distributed worldwide.
Offer
- Customers: Innovation, Very diversified line of products, Belonging to a brand, Quality, Transparency
- Elite athletes: Innovation, Quality, Sponsorship, Exposure, Strong brand image
- Investors: Stable and important growth, Sustainability, Strong image, Diversified portfolio of brands, Dividends, Company involvement in R&D, 600+ Patents
- Workers: Wages, Good conditions: Nike Manufacturing Index
- Global population: Sustainable business operations, Corporate Responsibility, Green oriented business, Reduce-Reuse-Recycle

- Elite athletes
- Customers
- Shareholders
- Board of directors
- Executives
- Key suppliers
- Companies owned through acquisitions ( Cole Haan, NikeGolf, Jordan, Hurley, Converse, Umbro)
- Employees and Workers
- Manufacturers and Factories
Stakeholders
Nike has customers, subsidiaries, employees, factories, workers, athletes, shareholders, etc. all over the world as detailed in the following figures, and they all have their specific and attractive offer.
Poles: Offer & Stakeholders
Second Facet
Global business design entails fundamental missions, reasons for being, visions that aim to significantly contribute to addressing globally important issues and solving globally important problems.
Poles: Character & Offer
Third Facet
Global business design aims towards global performance in achieving its mission, notably encompassing a multi-stakeholder perspective and an economical, societal and environmental sustainability perspective.
Poles: Character, Offer, Creation & Stakeholders
Fourth Facet
Global business design exploit the incessant flow of possibilities offered by knowledge production and technological innovation, deeply engraining these in the fabrics of the business.
Poles: Character, Offer, Creation & Stakeholders
Fifth Facet
Global business design dynamically defines the business in a global, holistic, both comprehensive and deep way, seamlessly, efficiently and sustainably integrating how the business gets to market, sells, delivers, distributes, produces, supplies, innovates, finances itself, hires, learns, and so on.
Poles: Character, Offer, Creation & Stakeholders
Nike definitely does business in a global and holistic way. Every step of its value chain is deeply efficient and sustainability is clearly part of Nike's character. As you can see on the following figure and details, Nike achieved to integrate its value chain in order to optimize its operations all over the world in a seamless and sustainable way, innovating to create the most value possible out of restrained resources, and even closing the loop by reusing worn out products to plan the production of new materials.
Global Value Chain
as detailed by Nike
Nike Factories Spreading
According to the Tetrahedron development, these two poles together form the Exchange dyad, which includes the Gains flowing from the Offer and the Contributions flowing from the Stakeholders.
As you can see, today Nike has a well diversified portfolio of 7 brands, and revenues of $20,9B from all over the world in 2012 for a CAGR of 9,68% since 1991. Nike also has 20% of the athletic footwear global market.
Nike not only reduces its amount of raw resources, it also recycles and reuses its excess materials and worn out products as a way of contributing concretely to the preservation of the environment. Furthermore, after having some issues in the past with child labor, Nike is now complying with labor ethics and following a code of conduct implemented not only among its employees and workers, but also its sub-contractors. The following figures represent how Nike now dedicates itself to sustainability and labor ethics.
According to the Tetrahedron development, these two poles together form the Competition dyad, which includes the Defenses flowing from the Character and the Threats flowing from the Offer.
Offices & Subsidiaries
Offer
- Workers: Wages, Good conditions (Nike Manufacturing Index)
- Global population: Sustainable business operations by having:
Corporate Responsibility (Footwear Sustainability Index, Apparel Sustainability Index)
Green oriented business
Reduce-Reuse-Recycle
- Hypothesis: Sustainability can positively impact and improve Nike's business and its growth potential. The “age of abundance” is over. In this new world, resources are scarce, and sustainability is a business imperative.
- Values: Sustainability, Innovation, Transparency, Design
- Vision: Nike's vision is to build a sustainable business and create value for Nike and its stakeholders by decoupling profitable growth from constrained resources.
- Concept: Nike is maintaining a relentless focus on sustainable innovation, from evolutionary enhancements to disruptive shifts that can transform the industry.
Character
- Expand sports access
- Social programs implementation & partnerships
- Fundation
- Funds raising
- Various sustainability programs
- Constant and sustainable growth
- Dividends
Offer
- For Nike, there is no finish line.
- Mission: “To bring inspiration and innovation to every athlete in the world.” (And if you have a body, you are an athlete.)
- Sustainability can positively impact and improve Nike's business and its growth potential, sustainability is a business imperative.
- Nike's vision is to build a sustainable business and create value for Nike and its stakeholders by decoupling profitable growth from constrained resources.
- Nike is maintaining a relentless focus on sustainable innovation, from evolutionary enhancements to disruptive shifts that can transform the industry.
- Metrics: First position in Global Market share of almost 20% in athletic footwear (20,9 billion $ revenues in 2012/CAGR of 9,68% since 1991)
Character
- Sustainably manufactured innovative products
- Nike creates and enhances its business model by developing and enabling innovative sustainable improvements to every aspect of its value chain
- Nike's strong brand equity fosters actors to rally globally to its sustainable involvements
- Technologies: Close the loop,
Reduce-Reuse-Recycle
Creation
- Elite athletes
- Customers
- Shareholders
- Board of directors
- Executives
- Key suppliers
- Companies owned through acquisitions ( Cole Haan, NikeGolf, Jordan, Hurley, Converse, Umbro)
- Employees and Workers
- Manufacturers and Factories
- Social actors
- Funded beneficiaries
Stakeholders
The third facet encompasses the whole Tetrahedron business model design analysis, its four poles being involved somehow.
Definitions of Sustainability
“ Ability to continue, without being degraded”
-Collins English Dictionary-

“ Ability to last or continue for a long time”
-Merriam Webster Dictionnary-

“Ability to be maintained at a certain rate or level”
-Oxford Dictionnary-

“ Ability to maintain or support an activity or process over the long term ”
-BussinessDictionary.com-
Nike is doing business sustainably by always considering altogether its social, environmental and economical impacts in a global perspective.
Social
Environment
Economic
Expanding access to sport in communities (Sport for Social Change Networks, Homeless World Cup, Grassroots, Soccer, Magic Bus, Let me play, etc.)
Engaging consumers to help creating solution to social issues (LIVESTRONG, N7, Cole Haan, RED, Hurley’s H20)
Use sport to help rebuild and strengthen communities, after natural disasters (Partner with NGOs, Moving Forward program)
Nike Fundation (Girl effect)
Nike School Innovation Fund (for Education in Nike’s hometown headquarter)

Nike Better World
Nike energy and carbon program (Improved data management system, Understand real energy needs, Reduce Green House Gases, lean-systems)
Water savings (analyzing water needs and finding alternatives)
Reducing waste (shoe boxes design, reusing and recycling products, composting)
Cuts by 2015:
20% in CO2 emissions
15% in Water use
10% in Waste production

"Fiscal 2013 was a great year for NIKE, driven by our innovative products and the power of our brands. And we’re excited about what lies ahead. We have the best leadership team in the industry and a deep innovation pipeline. Both are aligned against our biggest opportunities to drive growth, manage risk and drive long-term shareholder value."

Marc Parker, President
& CEO of Nike

- Customers: Innovative technology-related products
- Elite athletes: Innovative products & Co-Creation
- Workers: Nike's New Generation Manufacturing Indexes
- Company involvement in R&D (but does not disclose the amount)
- 600+ Patents
Offer
- No finish line.
- Innovation implied into the mission
- Nike is maintaining a relentless focus on sustainable innovation, from evolutionary enhancements to disruptive shifts that can transform the industry.
Character
- Designing innovative products sustainably.
- Nike creates and enhances its business model continuously by auditing its customers and factories in order to optimize every key aspect of its value chain
- Key competencies: innovate, design, marketing
- Technologies: Close the loop, Reduce-Reuse-Recycle
- Elite athletes: feedback
- Research & Develop novelty

Creation
- Elite athletes
- Customers
- Board of directors
- Executives
- Key suppliers
- Companies owned through acquisitions ( Cole Haan, NikeGolf, Jordan, Hurley, Converse, Umbro)
- Employees and Workers
- Manufacturers and Factories
Stakeholders
The fourth facet also relates to the Tetrahedron business model design analysis in its entirety, touching all four poles.
Evolving in a world of continuous threats from competitors and surrounded by technological evolution, Nike has to be ahead of the trends by doing R&D and working closely with its elite athletes in order to ride the flow of opportunities. Nike is constantly developing its character by offering highly efficient products and by driving innovation to fill the stakeholders needs for improvement.
Nike puts also emphasis on developing innovative ways to reuse its products : creating running tracks, sport courts and even new shoes and clothing help minimizing its impact on the environment.
Nike invests also significantly into extending its leadership in athletic footwear, apparel and equipment by involving into the digital realm of fitness, coaching and training services.
Nike is also continuously learning and innovating by listening to the feedback of its professional athletes to fulfill their needs and optimize their performances. Transferring innovation to its consumer products is then possible.
• Monitoring protectionist trends and developments throughout the world.
• Monitoring for dumping investigations against products from China and other countries.
• Monitoring for and advocating against other impediments that may increase customs clearance times for imports of footwear, apparel and equipment.
Finally, Nike manages risk to make its value chain predictable by constantly:
The last facet again incorporates every pole implemented in the Tetrahedron business model design analysis, but also every aspect of every pole, therefore it refers to our initial figure.
This is Nike Fuel
Last Words
As you can see, Nike is clearly a global business, and if not the best, certainly one of the best. As demonstrated along with this wonderful Prezi, Nike can easily be depicted through the Tetrahedron business model design analysis in order to assess its performance regarding the five specific facets of a global business design. We hope you enjoyed discovering the powerful global company that is Nike as much as we enjoyed working on it!
Our Team
References
Nike's Labor Ethics Issues Percentage Noncompliance

Official entry towards competing for the title of



in the
Global Business Design Championship
for the year 2013
Best Global Business Design
>$1 billion revenue
Benoît Montreuil
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