After reading Nike’s vision statement, “To experience the emotion of competition, winning, and crushing competitors (1978)” is a great me great metaphor, both related to their products and as their company. Sounds a bit aggressive, but after reading this it would make give me the idea that if I purchase a pair of Nike’s shoes then I would be out my opponents, and as a company slogan in itself. Nike appears to be honest about what the company stands for, by crushing the completion and focusing on winning, but business is business. This core ideology concept is what separates great companies from the mediocre ones, and that Nike’s attitude gives its ability to move forward as a multidivisional organization instrument for viewing or scope. Not
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However, over-diversification can potentially damage a company’s image and bottom line. An example of this kind of tragedy is Northrop Grumman. The fourth largest defense contractor in 2010. It has always been successful with electronics and robotic systems, but in 2001 it diversified into shipbuilding for the Navy. While we can't exactly use a Titanic metaphor to describe this effort, we could probably use an anchor one. This venture was very expensive, had razor-thin margins, and did not sync with any of Northrop's other businesses. In March 2011, Northrop's CEO said they got out of the shipping business to avoid "a drag on its bottom line for years to come."
The solution for a recommendations to the Nike strategic leaders is not diversification for diversification's sake. The solution is controlled diversification. A prime example of controlled diversification is McDonalds. The company is in a perpetual state of diversification; McCafe, McSalad, McNuggets, McEtc., but it doesn't diversify out of its sphere (fast food) into retail or consumer electronics.
The lesson? Even during tough times, stick with what you know for “DIVERSIFICATION AND THE MULTIBUSINESS
However, over-diversification can potentially damage a company’s image and bottom line. An example of this kind of tragedy is Northrop Grumman. The fourth largest defense contractor in 2010. It has always been successful with electronics and robotic systems, but in 2001 it diversified into shipbuilding for the Navy. While we can't exactly use a Titanic metaphor to describe this effort, we could probably use an anchor one. This venture was very expensive, had razor-thin margins, and did not sync with any of Northrop's other businesses. In March 2011, Northrop's CEO said they got out of the shipping business to avoid "a drag on its bottom line for years to come."
The solution for a recommendations to the Nike strategic leaders is not diversification for diversification's sake. The solution is controlled diversification. A prime example of controlled diversification is McDonalds. The company is in a perpetual state of diversification; McCafe, McSalad, McNuggets, McEtc., but it doesn't diversify out of its sphere (fast food) into retail or consumer electronics.
The lesson? Even during tough times, stick with what you know for “DIVERSIFICATION AND THE MULTIBUSINESS