Nike Inc.

The topic that I have chosen to do a research project on is Nike Inc. I chose to do my research on Nike because I am for one, very much interested in Nike, and secondly I am very interested in Nike’s clothing, shoes, and accessory line.

Basketball players “wanna be like Mike”, but shoe companies “wanna be like NIKE.” NIKE is the worlds #1 company and controls more than 40% of the US athletic shoe market. The company designs and sells shoes for just about every sport, including baseball, volleyball, cheerleading, and wrestling. NIKE also sells Cole Haan dress and casual shoes and a line of athletic wear and equipment, such as hockey sticks, skates, and timepieces. In addition, it operates NIKETOWN shoe and sportswear stores and is opening JORDAN in store outlets in suburban markets. NIKE sells its product to about 19,000 US accountants, in about 140 other countries, and online. Chairman, CEO, and co-founder Phil Knight owns. Nike Co. is very interesting, as well is a popular brand.

Nike, pronounced NI-KEY, is the winged goddess of victory according to Greek mythology. She sat at the side of Zeus, the ruler of the Olympian pantheon, in Olympia. A mystical presence, symbolizing victorious encounters, NIKE presided over history’s earliest battlefields. A Greek would say, “When we go to battle, and win, we say it is NIKE.” Synonymous with honored conquest; NIKE is the twentieth century footwear that lifts the world’s greatest athletes to new levels of mastery and achievement. The NIKE “swoosh” embodies the spirit of the winged goddess who inspired the most courageous and chivalrous warriors at the dawn of civilization. Among artistic representations of Nike are the sculpture by Paeonius (c. 424 BC) and the “Nike of Samothrace.” Rhodians probably erected the latter, discovered on Samothrace in 1863 and now in the Louvre Museum, Paris, about 203 BC to commemorate a sea battle. Excavations have shown that the sculpture was placed alighting on a flagship, which was set in the ground in such a way that it appeared to float.

If you were to break the word NIKE down, you would get Ni-key. The pronunciation for Nike is ‘nI-kE. Its function is noun, and its etymology is Greek NiKE. If you defined the word NIKE, you would find out that it means the Greek goddess of victory.

Another meaning and definition of a word is SWOOSHING. Main entry: Swoosh, function is noun, and it is an act or instance of swooshing.

The origin of the swoosh dates back as far as 1971. Phil Knight was supplementing his modest income from Blue Ribbon Sports Inc. by teaching an accountant class at Portland State University. There he met Carolyn Davidson, a graphic design student, who was working on a multi-perspective drawing assignment in the hallway. He offered her a couple of bucks per hour if she would do some design work for his small company.

This all happened because “Representatives from Japan were coming for a presentation and Phil wanted some charts and graphs to show them” according to Davidson. Apparently this wasn’t the last time Phil had asked Carolyn Davidson to create a design for him and Blue ribbon Sports. According to Davidson again, “Phil had asked her to work on a shoe stripe because supposedly Phil needed more inventory control.” (In spring of 1992, the first shoe with the Nike Swoosh was introduced)

There have always been numerous predictions and questions asked about what Nike pays its people. An average salary for a Nike Spokesman (Tiger woods) is $55,555 dollars per day, which adds up to 20,277,575 dollars in a one years earned salary. Other salaries of Nike employees such as an Indonesian factory worker who is making shoes makes $1.25 per day and an on average of $456.25 per year. Lastly, Nike CEO Phil Knight is worth roughly over $5.8 billion dollars.

Nike ads like any other businesses require interpretation. Some of this reading goes on at the conscious level, some unconsciously. As opposed to extremists on either side of the interpretative question, I fall most nearly to the constructivist point of view in that I view meaning as interplay between text and the reader.

Ads work on a variety of different levels including, but not limited to, sign typology, paradigmatic meaning, psychological appeals, emotion, roles, values/beliefs, and knowledge. Again, the impact of an ad comes from the interplay between these various aspects of make-up and the reader’s own notions about him/herself and the world.

Rubber-soled shoes were first mass-marketed as canvas-top “sneakers” by U.S. Rubber, with its keds® in 1917. But the elevation of athletic shoe manufacture to both a science and a fashion was due largely due to Phil Knight and Steve Bowerman of Oregon.

In 1958, Phil Knight, a business major a the University of Oregon, and a miler on the track team, shared with his coach, Bill Bowerman, a dissatisfaction with the clumsiness of American running shoes. They formed a company in 1964 to market a lighter and more comfortable shoe designed by Bowerman. In 1968, this company became NIKE, Inc.--- named for the Greek goddess of Victory. At first, Knight and Bowerman sold their shoes in person, at track meets across the Western US. Their company thrived through a classic combination of entrepreneurship and innovation. Bowerman’s most memorable technical breakthrough was the optimal traction of the waffle soles he invented by shaping rubber in the waffle iron in his kitchen (1972). Other essential innovations were the wedged heel, the cushioned mid-sole, and nylon uppers. Knight’s first great marketing ploy was announcing that “four of the top seven finishers” in the marathon at the 1972 Olympic Trials had worn Nike’s (the first three runners, in fact, had worn West German Adidas®). Through the 80s and 90s, NIKE’s advertisements helped make it by far the foremost retailer of athletic shoes world-wide, thanks to the endorsements from superstars like Michael Jordan, and the catchy slogans like “Just Do It.” After dozens of years, patents and commercials, NIKE and its competitors created an absolute mania for elaborate athletic shoes, in the US and aboard. Though fashion remains a matter of taste, it is undeniable that both world-class athletes and even the average aerobics enthusiast owe a debt to the innovations of Phil knight and Bill Bowerman and to the industry they inspired. Phil Knight is the founder and CEO of the athletic gear company Nike. Knight and Nike helped start a sports business and revolution in the 1970’s changing old- fashioned tennis shoes into highly specialized equipment and promoting them as symbols of athletic prowess and success. Nike’s success made Knight one of the America’s wealthiest men. In the 1990’s he was the subject of frequent protests over allegedly poor working conditions at Nike manufacturing plants in Asia. Phil Knight was born on February 24, 1938. He is as well married. His position in Nike is Chief Executive Officer, President and Chairman, Nike Inc. His educational background is Business Administration, University of Oregon (1959); M.B.A., Stanford University (1962). His favorite personal sports are tennis, running, and golf. A co-founder of Nike and former University of Oregon miler with a personal best 4:10, Phil Knight received an MBA from Stanford University. His master’s work provided the outline for the business that would become Nike, the world’s number-one sports fitness company. His theory? High-quality running shoes could be designed in the United States, manufactured in Asia, and then sold in America at lower prices than the then-popular West German-made running shoes.

With a $500 investment matched by his co-founder and former coach Bill Bowerman, Knight began Blue Ribbon Sports (Nike progenitor) in 1964. Off to an uncertain start, he sold his shoes out of his back of a station wagon but continued to practice as a C.P.A. and teach at Portland State, Univ. until 1969.

The Cortez, the first shoe to appear under Nike brand, arrived on the athletic scene in 1972. Since then, Knight has inspired numerous innovations in the business of sports, including future-based ordering; substantial investment in long-term product research and development; national media reinforcement of performance and styling ties between product and athletes, and the creation of a customer- service program supported by a full-time technical team.

Nike’s Potential Growth: Knight wants to see Nike become a truly global sports and fitness company over the next 5 years. Global thinking, he stresses identities not only potential markets but types of sports and athletes that deserve Nike support.

A personal statement stated by Knight is “it’s now my job to create an atmosphere of peace in the chaos of business- something I’ve learned from Asian business style.

Phil Knight is currently the 13th richest man in the world. He is worth approximately 5.8 billion dollars. Phil’s 4th quarter dividend earnings for 1997 were 80 million dollars. Additional bonus given to Knight in 1995 was $787,500. The value of Nike stock owned by knight was $4.5 billion in 1995. Some of Knights endorsements include Michael Jordan, Tiger Woods, and the Brazilian soccer phenom Renaldo. In 1992, The Sporting News has called him “The Most Powerful Man in Sports.”

Bill Bowerman is the co-founder of Nike as well. He was born February 9, 1911. He died on December 24, 1981 in his sleep of his Fossil, Oregon home on the third Saturday of Christmas Eve. He was 88 years old. Bill was the person who more then anyone else started the nations jogging craze. He also was the inventor of the waffle sole for running shoes. In addition, his coaching tenure at the University of Oregon was highlighted by some of the most successful teams in the nation. He turned the college town of Eugene, Oregon into the running capital of the world, spread the gospel of jogging and fitness, and along the way, revolutionized the running shoe.

During his coaching tenure from 1949 to 1972, Bowerman produced four national collegiate championship teams, plus two more that were runners up. Individually, his interest, his athletes set 13 world and 22 American records. Among his 23 Olympic athletes was 1960 medallist Otis Davis, who won the 400 and ran the 4 x 400 relay. Besides Davis, his other top athletes reads like a Who’s Who in American distance--Dyrol Burleson, Jim Grelle, Bill Dellinger, Ken Moore, Wade Bell, and the late Steve Prefontaine (Hall of Fame member), Steve Savage and Keith Forman. A graduate of Oregon, Bowerman became active with the Nike Shoe Company after retiring from coaching. He also coached 24 NCAA individual champions, 38 Pacific Coast Conference individual champions, 132 Northern Division individual champions, 4 NCAA team champions in 1962, 1964, 1965, and 1970, 33 Olympic team competitors, 64 All-Americans, and coached the 1972 Olympic track and field team. In 16 of his 24 years, his Oregon track team finished in the top 10 in NCAA championships. He owns 13 consecutive Northern division team championships. His dual-meet record at the U of O was 114-20, a winning percentage of .843. He served at the helm of the NCAA track and field coaches association and NCAA track and field rules committee, and was a professor emeritus at the U of O. Bowerman not only coached the athletes, but also was a tireless worker and innovator for the sport of track and field. He was instrumental in developing rubberized asphalt runaways, developed statewide programs for high school athletes, and a instituted jogging programs throughout Oregon that led to the nationwide jogging craze.

Though his innovation and drive made him wealthy, Bowerman gave as much or more back to the community. His matching-grant programs have contributed to Oregon’s education, arts, medical research and the environment. He’s given money to Gilchrist, Mapleton and Medford to pay for all-weather tracks and, when budget cuts threatened the Oregon baseball program, Bowerman dug into his own wallet to support the formation of a club baseball program. In 1990, he agreed to donate 2.1 million dollars for the construction of a two-story building at the legendary Hayward Field on the UO campus that now bears his name. He also created the Bill Bowerman Foundation, which supports grass roots track-and-field programs throughout the country.

Steve Bowerman had given frequently to organizations like the Oregon Bach Festival, Eugene Arts Foundation, Eugene Symphony, Eugene Opera, and the UO Museum of Natural History, and always to little fanfare.

Nike’s mission for corporate responsibility is “to lead in corporate citizenship through programs that reflect caring for the world family of Nike, our teammates, our customers, and those who provide services to Nike.”

Nike has more than 500 contract factories around the world in about 45 countries. In May of 1998, Nike set out 6 new corporate responsibility goals for these factories.

Nike has raised its minimum age limits from the International Labor Organization standards (15 in most countries and 14 in developing countries) to 18 in all footwear manufacturing and 16 in all other types of manufacturing (apparel, accessories, and equipment.) Footwear factory managers, including C.T. Park, pledged not to hire anyone under the age of 18. In Vietnam, that is the minimum age anyways, so the factory did not have to alter hiring practices. (According to the labor law, Vietnamese under that age are allowed to work with parental permission. Not at Nike Factories though.)

Big retail and apparel companies are in a global race to increase profits by driving down costs. As they source merchandise from all over the world, they search for places where workers are paid the lowest wages, and human rights are trampled. There are no international laws that require corporations to respect workers’ rights, to ensure decent working conditions, or even to pay a living wage. In fact, the current trade laws encourage companies to make their products in places with the worst conditions and the lowest wages -- and places where workers are not free to stand up for their rights and protect themselves.

Companies are driving us all into a race to the bottom. Factories with good conditions are getting shut down. That means decent factories in the U.S. and Canada - as well as decent factories overseas. And sweatshops are opening up - in New York, Toronto, and L.A. - as well as in Honduras, Indonesia, and China.

In a factory in Guatemala, hundreds of young women worked around the clock earning pennies making Van Heusen men’s dress shirts. To get better wages and working conditions they fought for ten years to win a union. After they won, the Van Heusen shirt company closed their factory and moved the work to lower-wage sweatshops nearby. “We organized a union because we wanted to work less than 60 hours a week and have time for our kids,” said Claudia Rodriguez*. “Now we’re making the same shirts, but we’re back to working long hours in sweatshops because they closed our union factory.” This is a sweatshop. In a Manhattan sewing shop, young immigrants work up to seven days a week, from early in the morning until late at night. The owner punches their time cards after eight hours, but they keep working even though they are never paid overtime. This is a sweatshop. Some of the garments they make were sold at big name stores such as Lord & Taylor. In a factory in the Dominican Republic, workers earn eight cents for every $20 baseball cap they make. Hundreds of workers have been fired for going to school at night. Hundreds more were fired for trying to organize a union. This is a sweatshop. They make caps for Nike and Champion with the logos of major universities in the U.S. and Canada - such as Notre Dame and University of Michigan. In a Kentucky uniform factory, the pay is so low that many full-time workers qualify for food stamps and other public assistance. There are no health benefits, so many workers must choose between buying food and taking their kids to the doctor. Lisa Jones quit because of sexual harassment at the factory. In a quote by Lisa Jones… “I started thinking, how am I going to raise my little girl to have self-respect if I don’t have it,” she said. This is a sweatshop. They make uniforms that many cities purchase with tax dollars. The major retail chains and big name apparel companies call the shots in the clothing industry. By constantly driving down the price they will pay for goods, they force sweatshop conditions on sewing factories. That means higher profits for the retail and apparel giants, not lower prices for consumers. Five department stores chains account for nearly two-thirds of all department store sales in the U.S. Those retail chains have tremendous power over the companies that make the clothing the stores sell. Most of the garment factories, here and around the world, couldn’t stay in business if they lost the business of the retail giants. That’s why the big retailers could stop sweatshops if they wanted to, or if they had to. When these retailers demand quality merchandise and on-time delivery, they get them. If they also demanded that every garment had to be made under decent conditions, there is no question that things would improve fast.

In the fall of 1999, an Indonesian human rights organization interviewed 3,500 workers in Nike contractor factories in Indonesia about their pay and working conditions. The survey, conducted by Indonesia's Urban Community Mission in conjunction with U.S.-based Press for Change, was the most comprehensive investigation of working conditions in Nike's Indonesian plants in three years. Here are some of their findings: