Promise and Perils of Globalization - Nike
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The Promise and Perils of Globalization: The Case of Nike1
Richard M. Locke
Alvin J. Siteman Professor of Entrepreneurship and Political Science
MIT
1 This case was prepared for the Sloan School of Management’s 50th Anniversary celebration and should be read in conjunction with “A Note on Corporate Citizenship.” This case was prepared with the active involvement and research assistance of the following Sloan MBA students: Vanessa Chammah, Brian
Curtis, Elizabeth Fosnight, Archana Kalegaonkar, and Adnan Qadir. I would also like to thank Miguel
Alexander, Maria Eitel, Dusty Kidd, Joseph Tomasselli and Dara O’Rourke for their helpful comments and assistance during this project.
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1. Introduction
How should global corporations behave in the new international world order? What constitutes good corporate citizenship in a world where the stakeholders are diverse and dispersed around the globe and where no clear or consensual rules and standards exist?
These questions shape the behavior of most multinational corporations (MNCs) today.
Although multinationals are eager to pursue the opportunities of increased global integration, they are increasingly aware of the reactions which their strategies induce – both at home and abroad. Thus, they tread warily, lacking clear and agreed-upon definitions of good corporate citizenship.
Through a case study of Nike, Inc. – a company that has come to symbolize both the benefits and the risks inherent in globalization – this paper examines the various difficulties and complexities companies face as they seek to balance both company performance and good corporate citizenship in today’s global world.
1. The Athletic Footwear Industry
The athletic footwear industry experienced an explosive growth in the last two decades. In 1985, consumers in the United States alone spent $5 billion and purchased
250 million pair of shoes.2 In 2001, they spent over $13 billion and bought over 335 million pair of shoes.3
The Promise and Perils of Globalization: The Case of Nike1
Richard M. Locke
Alvin J. Siteman Professor of Entrepreneurship and Political Science
MIT
1 This case was prepared for the Sloan School of Management’s 50th Anniversary celebration and should be read in conjunction with “A Note on Corporate Citizenship.” This case was prepared with the active involvement and research assistance of the following Sloan MBA students: Vanessa Chammah, Brian
Curtis, Elizabeth Fosnight, Archana Kalegaonkar, and Adnan Qadir. I would also like to thank Miguel
Alexander, Maria Eitel, Dusty Kidd, Joseph Tomasselli and Dara O’Rourke for their helpful comments and assistance during this project.
2
1. Introduction
How should global corporations behave in the new international world order? What constitutes good corporate citizenship in a world where the stakeholders are diverse and dispersed around the globe and where no clear or consensual rules and standards exist?
These questions shape the behavior of most multinational corporations (MNCs) today.
Although multinationals are eager to pursue the opportunities of increased global integration, they are increasingly aware of the reactions which their strategies induce – both at home and abroad. Thus, they tread warily, lacking clear and agreed-upon definitions of good corporate citizenship.
Through a case study of Nike, Inc. – a company that has come to symbolize both the benefits and the risks inherent in globalization – this paper examines the various difficulties and complexities companies face as they seek to balance both company performance and good corporate citizenship in today’s global world.
1. The Athletic Footwear Industry
The athletic footwear industry experienced an explosive growth in the last two decades. In 1985, consumers in the United States alone spent $5 billion and purchased
250 million pair of shoes.2 In 2001, they spent over $13 billion and bought over 335 million pair of shoes.3