Major Report

Matthew Friedberg, Taylor Kiel, Lincoln Koyejo, Henry Newman, Elise Wright
Team Leader: Lincoln Koyejo
Group 72
Nike, Inc.
Eller College of Management
MGMT 310A
November 22, 2021
Introduction
All businesses utilize their strategies and models to achieve success. However, every
organization is subject to organizational behavior issues that are easy to overlook. In this report,
two organizational issues that impact Nike will be discussed, including the antecedents and
potential solutions to each of these problems, supported with academic research. It will provide
evidence that Nike has opportunities to continue to better themselves and their organizational
model as they progress into the future.

Company Overview
Nike Inc., founded in 1964 and based in Beaverton, Oregon, is a major athletic footwear and
apparel brand that sells its products worldwide. The company is known for its high-quality and
innovative products as well as its widespread popularity, which allows it to enter more markets
than any other sports apparel company. Although they compete with companies such as Adidas,
Reebok, Under Armor, and Puma, Nike is still the most powerful and valuable sports apparel
company in the world, holding a market valuation of more than $30 billion. With over 1,000
retail locations worldwide, Nike employs approximately 74,000 people.

Data Collection Process

To recognize our management issues within Nike, we needed to collect a wide range of data. To
do this, we sent out a 10 question survey to four former and current employees working at Nike.
The questions within the survey had to do with two topics: job ambiguity and job promotion.
After sending out the survey, we used a Likert scale to analyze the results, where 1 = “strongly
disagree”, and 5 = “strongly agree.” In addition to the survey, we sat down and interviewed Brian
Brasfield, a current Nike Department Manager. While doing this, we were able to understand
how these issues are affecting employees at a functional and managerial level. Furthermore, we
concluded that even though we thought the problem was with job ambiguity, the issue was really
with motivational systems within Nike.The survey that we used to gather our data is shown in
Appendix A.

Data Analysis
The survey data revealed that employees at Nike feel that they are competent at their job and
know what Nike expects from them. About sixty-three percent of the respondents agreed that
they know what's expected of them at Nike and have the qualifications to carry out those
expectations. However, based on our interview with the Nike manager, Brian Brasfield, Nike is
in the works of updating their new hire training program because they felt that the original one
was insufficient.

The issue seems to be with new hires not feeling ready to be out on the field after they complete
the training program. This is concerning for Nike because new employees would not be able to
provide the premium customer service that consumers expect from employees and could possibly
leave a bad impression on them.

There is a more glaring problem at Nike regarding job advancement. The interview with
Brasfield showed that Nike does not look within their own company during the hiring process for
corporate positions. Brasfield, who has been working at Nike since 1997, stated that Nike would
take only “two percent of the applicants from the field” when hiring corporate positions and
claims that was the reason “why [he] wasn’t getting considered for any of these roles.”

The results from the survey also indicated that Nike employees feel that Nike is lacking
regarding job advancement. Seventy-five percent of the respondents of the survey disagreed with
the following statements, “Nike has sufficient opportunity to be promoted from within, I am
fairly considered when advancement opportunities arise, and I understand what I need to do to
get promoted within the company.” This indicates a clear problem for Nike because their
employees feel that they are unable to advance within the organization and could hurt employee
retention.

Problem 1: Low Motivation to Approach Customers

When surveying past and current employees regarding job ambiguity, we found a more prevalent
issue surrounding motivation. The first problem faced by Nike is that their new employees lack
the motivation to approach customers. Initially, we thought this may be due to job ambiguity
with employees not knowing how best to approach customers. However, data from our survey
showed that experienced employees feel that they are competent at their job and know what Nike
expects from them, but Brasfield said that even after training, new employees at Nike are slow to
interact with customers. Therefore, after analyzing the data more closely, we concluded that the
main issue is that employees are not learning how best to interact with customers because they
are lacking the motivation to approach them and practice serving them.

This problem is important and warrants attention because a lack of motivation is strongly
correlated with poor job performance and moderately correlated with a lack of organizational
commitment. Nike is aware of how important it is to resolve this issue, and is currently in the
process of redesigning its training program to fix this issue.

Antecedent: Lack of Motivational Systems

One antecedent of this problem is that there is a lack of motivational systems around customer
interactions. This is likely an antecedent of this problem because the expectancy theory states
that if employees do not feel that their actions will result in a valuable outcome, they experience
low valence and are less motivated to complete the task (Wang & Wanberg, 2017). In Nike’s
case, Brasfield acknowledges that customer service is best learned when employees “actually
deal with customers” rather than role play with other employees during training. However, new
hires are not approaching customers to gain these skills because they lack valuable incentives
(and hence the motivation) to do so.

Solution: Motivational Game

In an effort to improve motivational systems for employees to optimally service customers at
Nike, there must be a learning opportunity and an incentive/reward system that would urge them
to do so.

A solution that would give new employees a learning opportunity to better serve customers
without just putting them out on the sales floor would be to implement a job simulation game.
Simulation games are very effective compared to more traditional strategies for training because
“they simultaneously engage trainees' affective and cognitive processes” (Sitzmann, 2011). This
simulation game would be geared towards showing new hires how to properly deal with
consumer concerns, questions, conflicts, and building positive relations with them. Employees
would be motivated to use the simulation game because of its entertainment value that would
incline employees to play the game continuously while teaching them the necessary strategies to
deal with customers (Sitzmann, 2011). This would directly result in increased confidence within
new hires when dealing with customers because they will be able to recognize situations on the
sales floor that were similar to the simulation and carry out the appropriate responses.

Implementing a job simulation game would be quite expensive to make, but worth it in the long
run. Since the simulation would be fairly simple in terms of content it would not take as much
time to create and implement compared to more complex simulators. It would take about eight
weeks to launch the simulator. New hires should be surveyed to gauge the effectiveness of the
program. A timeline of the simulation can be found below:

Week 1: High-level Nike employees will discuss and specifically list the different scenarios and
strategies they want new hires to learn about.
Week 2-6: This list is given to a medium-sized team of game developers and they will design and
create the simulator while
Week 6-8: THe job simulation is implemented and made available to most Nike stores

Risk:
● Employees not taking the job simulation seriously
● Could lead to new employees being less creative and have a more “robotic” or scripted
response when dealing with customer dilemmas

The job simulation game would not be the only part of the solution to the lack of motivational
systems. This is because the simulator would motivate employees to learn the strategies and tips
of customer service, but would have no incentive to actually implement what they learned.

A solution for this would be implementing a reward system for employees who are able to
demonstrate that they are actively serving customers. It is known that rewards notably increase
job performance (Allscheid, S. P., & Cellar, 1996). Nike urges its employees to get customers to
sign up for a free membership for Nike.com so that is how performance will be measured for the
rewards. The rewards, however, have to be viewed as valuable by the employees or they would
not be effective in improving motivation (Allscheid, S. P., & Cellar, 1996). Extra paid time off
would be the best reward because it “is one of the most effective incentives for employees”
(Tsang, 2020). Employees at Nike will be ranked every week on the number of memberships that
they have acquired and the top performers would receive a certain amount of paid time off.

This solution is relatively low on cost and is being paid with employee work time. It would take
about two weeks to implement this reward program and the timeline for it can be found below:

Week 1: Upper management at Nike will decide on how much paid time off the top performers
get and how many of them get it
Week 2: The reward system is implemented in Nike stores

Risks:
● Reward may not be valuable to some employees
● Could lead to tension within the workplace due to competition
● Employees could make fictitious accounts to get ahead

To make employees accept these changes, Nike must express how they want to make their
employees feel recognized for their efforts and implementing a reward system would be the best
way to do so.

Problem 2: Limited Promotion Opportunities

The second issue Nike faces is a decreased job promotion level because employees lack the
necessary commitment to receive a job promotion. Job promotion is essential and warrants
attention because low levels of job promotion can result from lower levels of affective and
normative commitment within employees in an organization due to their strong correlation
(Bindl et al., 2019).

Antecedent: Job promotion levels are low within Nike due to the lack of normative and affective
commitment from employees.

Working at Nike can become a very stressful job for employees if they aren't willing to put in the
effort to connect with their customers. The learning curve for a new hire is immediate and can
ultimately determine our employees' level of commitment to Nike right away. Normative
commitment is the degree to which an employee ought to stay at a company. In contrast,
affective commitment is how an employee wants to stay at a company due to an emotional
attachment. We have found that these two types of commitment have dwindled due to the lack of
promotion within Nike and affect our job promotions. In a recent study, "it was empirically
revealed from this research that job promotion influences affective commitment with an r-value
of 0.601" and "it was empirically revealed from this research that job promotion influences
normative commitment with an r-value of 0.430” (Ogini, 2020). This shows how there is a clear
relationship and strong positive correlation between organizational commitment and job
promotion.

These findings indicate a direct link between our antecedent and a lack of job promotion within
Nike, especially relating to affective and normative commitment. Nike's employee's affective
commitment is reduced because they don't have a solid emotional attachment to the customers
they are serving; thus, they don't see a forcible job promotion in the future. Additionally,
normative commitment is lacking due to the training having a strong/quick learning curve and
repetitive tasks. Therefore, employees feel that they can easily be replaced and lack the necessary
commitment to be promoted.

Solution: Job Shadowing

Promoting from within is important because it boosts company morale while also reducing the
costs of recruiting new talent. It's also significant because it strengthens the overall brand. A
potential solution to the limited amount of promotion opportunities at Nike is to incorporate job
shadowing into the new employee training program. This would allow new hires to observe
experienced employees interact with customers and learn from observation, greatly increasing
the trainee's self-efficacy. According to the Essentials of Training Management Handbook,
successful training involves “an ongoing series of support methods that result in a change in
behaviors supported by reinforcement until the new behaviors become unconsciously
performed”. Job shadowing accomplishes this by allowing ongoing training and allowing new
hires to observe the positive reinforcement received after a positive customer interaction.
Shadowing experiences not only “provides employees with an overview of the role” but also
“provides employees with the opportunity to observe and ask questions to better understand their
role.” Overall, job shadowing can assist in the promotion process by building confidence in both
the hiree and upper management.

Due to the low cost of implementation, this solution is highly feasible. It would take two weeks
to plan and discuss the specifics of what the shadowing portion of the training would entail. The
following is a timeline for implementation:

Week 1: High-level managerial employees will meet to discuss the goals and desired results of
the mentoring program that were discussed above. These goals should be related to employee
training so that they are more aware of their role when interacting with customers. Details on
how the job shadowing experience will take place will be discussed based on how the training
program currently looks.

Week 2: Job shadowing experience is implemented.

Risks:
● Day of job shadow is unusually under or overwhelming
● Not enough time for immediate Q&A’s
● Disruption of worker leading the shadow

Employee/organizational buy-in can be achieved by having job shadowers observe the higher
quality employees. This can help the observer in recognizing how seriously the worker takes his
job and how motivated a Nike employee is throughout the day. As long as upper management
can bring in higher quality employees to be shadowed, new hires who see the positive and
enthusiastic atmosphere have a stronger chance of buying into the organization.

Conclusion
All companies, no matter how much success they’ve experienced, can face organizational
challenges and Nike is no exception. They can address the issue of the lacking motivational
systems driven by the difficulty to simulate interactions with customers in their training by
creating a simulation game for employees. Then Nike can work to solve the problem surrounding
limited job promotion, stemming from the lack of normative and affective commitment, by
implementing job shadowing opportunities. These organizational issues present an opportunity
for Nike to improve as they continue to grow and maintain being a leader in their industry.
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