BUS7B26 Emphaszing The Environment Assignment Sample

Introduction

NIKE was officially formed in the year of 1971 under a different name, where the company with the current name came into existence in the recent times of 1971. NIKE is famous for introducing the world to a modernized version of the different kinds of footwear, where the organizational calibre and the better understanding of the sports and workout style were first done by NIKE. The company has been achieving a giant growth of 19% in recent times, where even in the global pandemic situation, the company had maintained the stronghold of the revenue structure (Nike.com 2022). The company has achieved the status of being a constant sustainable growing company and the process to gain a huge customer base by mitigating the sustainable challenges will be described in this report.

Overview of the organization, sustainability strategies and challenges

Overview of NIKE

NIKE is headquartered in Beaverton, in the United States of America (USA), where the company oversees the different spheres of administration and marketing departments. NIKE has flourished as one of the most successful companies in the footwear industry by generating $44.5 billion revenue with the recent growth of 19% with the help of 73,000 employees globally (Nike.com 2022). The products that the company usually sells are from the categorical division of the different kinds of products, where the products have been created related to the activities for the tough sports and several other sports related activities. The different kinds of brands exist under the shadow of the principal authority of the company, where the most important brands are the NIKE basketball, Football, Running and various others.

Although, the year of 2021 has not been so profitable for the company, still, it has a better share of growth of almost 17% even in the Covid-19 pandemic times, where the increasing demand for sportswear had dropped. NIKE has been separated throughout the globe, having the major branches in countries such as Latin America, Europe, East Africa, China, North America and Asian parts. NIKE managed to gain a considerable portion of the market after having a broad and stable structure which had boosted the growth of 61% annual sales (Nike.com 2022).

Sustainability strategies of NIKE

There are several sustainability plans that NIKE has been using for the recent periods to develop a future long term commitment to the environmental balance and create a better outlook for the company’s diversified operations. The sustainability has been effective for the different globally diversified companies where the environmental backlogs are usually targeted to be minimized and gain an advantage in the future operations of the company (Nilsson et al., 2019).

Figure 1: NIKE sustainability strategy index

The sustainability of the company lies in the achievement of few plans that NIKE proposes to reach at a perfection state:

There was a better diversion of the production waste nearly to 100%, of which the company have achieve to have a 99% diversion from the landfill wastage
The use of renewable energy in a better form by installing such plants to achieve a strategized centered goal of about complete utilization of such renewable energy
The reduction in the wastage of water by about 30%, where the company has achieved to reduce the problem of water shortage in various parts of the world to a significant amount (Refer to Appendix 1). Apart from that, NIKE follows an end-to-end approach to reduce wastes from value chain and through systematic approach, all decisions taken by the management minimize waste
The company’s continued collaboration with the USAID Vietnam Low Emission Energy Program (V-LEEP) maintains environmental sustainability and focuses on launching NIKE’s Reuse-A-Shoe footwear-recycling program and try to innovate sustainable design in retail
By acknowledging environmental sustainability as a team support through partnerships with Non-governmental and entrepreneurial organizations and developing the Environmental Footprint Tool (EFT) to calculate environmental footprint (Jain et al., 2021)

Challenges of NIKE

There are several challenges that have been faced by NIKE when the company targeted to fulfill the fiscal as well as the strategic plans. The need for innovation puts most importance on the structure of the sustainability of the company, which helps to have a better environmental related outcome (Youssef et al., 2018).

Figure 2: NIKE Energy and Carbon Emissions

The formation plans have been laid down by the several factors responsible for the company’s annual growth. The challenges may include that the employees often have lodged several complaints regarding the excessive overtime (EOT) during the manufacturing of the environment friendly products, which has created more carbon emissions from running the plants overtime. There occurs an annual wastage in the natural resources exceeding 10% annually in NIKE, which in itself is a quite serious occurrence from the slide of the company, where the annual environmental wastage increases beyond the concerned limit (Refer to Appendix 2). NIKE has faced a tremendous challenge in reducing the wastage of non-renewable energy in the different production capacities where most of the non-renewable energy has been used at a higher margin, causing the fast depletion of the major fuel sources.

The major challenge which is common to many footwear manufacturing companies lies in the fact that these companies fail to mitigate the problem of landfills, which is created in the production process, of which NIKE has a considerable important share. The process of shoe manufacturing requires the use of freshwater to an excessive extent, where NIKE suffers most due to the dying and coloring industry mostly dependent on the use of such massive amounts of freshwater resources. NIKE has been criticized for the poor management of the toxic chemical dumps in the landfills causing several biological problems in different nations, and such a problem has been one of the serious challenges that the company offered to resolve at the earliest.

Sustainable strategy plan

The management of NIKE has decided to maintain a limit on the operating of the plants by 60 hours a week including a 24 hours off for every employee. The need for the adoption of a sustainable movement by having more preference towards sustainability is one of the most important observations in various organizations (Silvestre and Fonseca, 2020). This step may cause the plants to operate within a limited capacity reducing the emission rate. NIKE has taken the step to create a better improvement chart to have the manufacturing of all the footwear as well the sportswear with the 80% proportion of products measured under the environmental report. The emphasis on sustainability is much important to NIKE for the fact that sustainability maintenance serves as the most important factor for the revenues earned in the long term (Bini et al., 2018). NIKE has proposed and decided to target the better utilization of such energy sources by about 100% with several of the operational facilities and maintain more dependency on the renewable energy sources. NIKE has made the target in the fiscal year of 2021 and in the future years to reduce the waste to about 10% and have a better plan of the distribution centers of the company creating more diversions.

NIKE has cut through different plans to reach the conclusion that the company may reduce the dependency on freshwater by about 20% and improve the water supplier channels for the dyeing and finishing sections. The challenge of dumping toxic wastes which may be severely hazardous to the normal population is one of the principal causes as NIKE came up with the formation of the changes to be brought in the lead emission department. The company has also built a chemical management sector by establishing the NIKE Restricted Substance List (RSL). The company has set the criteria of wastewater management guidelines violating which may cause the company to take serious actions against the employees or the management, mostly set to preserve the quality of the freshwater. The culture of the business firm needs to be such that it supports the changes that permit the increase of the factors that ensure sustainability and have a better flow of work throughout (Richards and Font, 2019). The company has targeted in reducing the greenhouse gas emissions, where such goals are most aligned with the preferential line of saving the layers of the environment. The use of better equipment usually results to have a better strategic goal and achieve a good amount of efficiency in the conservation of fuel.

NIKE has the 2025 target of having the carbon layer emissions be reduced by at least 65%, and the direct interference in the manufacturing process by the inspection team has the better objectives of applying such goals to the realistic outcome. NIKE has taken to using solar power and not be dependent on the consumption of the nonrenewable energy sources which may abuse the deep core structure of natural resources, making their company set a diversified goal and have a detailed planning format to create an environmentally sustainable filter.

Implementation and benefits

Challenges	Implementation plan	Benefits
Wastage in natural resources	Creation of an improvement chart to maintain the balance between wastage of natural resources and reducing the wastage by 10% margin	The benefits usually lie where the organization have caused the detailed planning for reducing the overall wastage such as minimizing the emission costs
Wastage of non-renewable energy in running the macro production units	Creating a better resource program to reduce the dependency on the non-renewable energy	The better utilization of the energy points and having a low dependency on the non-renewable energy creates a conscious contribution towards environmental sustainability
Landfill problems regarding the output disposition and challenge of toxic waste reduction	Improvement of the operational facilities and creation of other units that may help the reduction of landfill issue	There is tremendous benefit associated with the steps taken to cover the problem of landfill, as the soil fertility and erosion occurs much less frequently
Excessive use of freshwater sources and causing the major sources providing freshwater to be dried up	Creating guidelines for the dying and coloring section to use the freshwater more consciously, and having the minimal use of such water with more water efficient units	The freshwater serves as the primary source of water in many water approved areas, where the use of freshwater remains as an acute shortage. The implementation of the steps taken to reduce such water shortage, many places may have proper waste facilities available at lower cost
Toxic chemical dumps in the different sites have creates severe issues for the marine life as well as the danger cited to the biosphere	Establishing the NIKE Restricted Substance List (RSL) has been immensely useful to act and control the degree of the toxicity by regulating the standards of the toxicity of the minerals dumped.	The toxic chemicals are a serious threat to mankind as well as the different forms of creatures, where the better intentions of a company may only seek to improve the degree of the toxicity of the chemicals that it may usually dump otherwise

Table 1: Organizational benefits of implementing strategies

(Source: Self-created)

The NIKE Company has taken various steps to create a more sustainable future for growth, when the several challenges that the company has faced have been laid down clearly and taken to be resolved by a better modulation. The challenges have ranged from toxicity of the input materials to the landfill problems, where the lead department has been put under strict surveillance to have better regulation for the manufacturing of the colors to be used as prime input. In the corporate responsibility curriculum of many business organizations, the importance of green marketing has been emphasized where the sustainability of the companies are usually increased to a large extent (Smith, 2021).

Conclusion

Considering the above discussion, NIKE has focused on the manufacturing and marketing of several sports uniforms and garments, where the company targets to meet the quality sustainability of the different sales departments. The beneficial factors that the company has used are more directed towards the maintenance of a balance with nature and also boosting the annual sales. NIKE has been successful in the maintenance of the nature of the products used and creation of a better scope for scaling down the level of the toxicity.

References

Bini, L., Bellucci, M. and Giunta, F., 2018. Integrating sustainability in business model disclosure: Evidence from the UK mining industry. Journal of cleaner production, 171, pp.1161-1170.

Jain, P., Chou, M.C., Fan, F. and Santoso, M.P., 2021. Embedding Sustainability in the Consumer Goods Innovation Cycle and Enabling Tools to Measure Progress and Capabilities. Sustainability, 13(12), p.6662.

Nike.com 2022. [online] Available at: <https://www.nike.com/in/> [Accessed 12 January 2022].

Nilsson‐Lindén, H., Rosén, M. and Baumann, H., 2019. Product chain collaboration for sustainability: A business case for life cycle management. Business Strategy and the Environment, 28(8), pp.1619-1631.

Richards, P. and Font, X., 2019. Sustainability in the tour operator–ground agent supply chain. Journal of Sustainable Tourism, 27(3), pp.277-291.

Silvestre, W.J. and Fonseca, A., 2020. Integrative sustainable intelligence: A holistic model to integrate corporate sustainability strategies. Corporate Social Responsibility and Environmental Management, 27(4), pp.1578-1590.

Smith, A., 2021. Green Marketing: Patagonia vs. Nike (Doctoral dissertation, The University of Arizona.).

Youssef, A.B., Boubaker, S. and Omri, A., 2018. Entrepreneurship and sustainability: The need for innovative and institutional solutions. Technological Forecasting and Social Change, 129, pp.232-241.