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Management - Essay Example

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In connection with the thrust of the sports apparel chain to position itself as a vanguard of Fair Trade where products are sourced from responsible suppliers, the Nike brand presents a problem as its workers are reportedly being intimidated by armed soldiers. Essentially, this…
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NIKE AND RESPONSIBLE SOURCING Submitted by: [Id Number] Time] [Unit Word Count: 439 [Email] Submitted [Name of Tutor]
In connection with the thrust of the sports apparel chain to position itself as a vanguard of Fair Trade where products are sourced from responsible suppliers, the Nike brand presents a problem as its workers are reportedly being intimidated by armed soldiers. Essentially, this paper will argue that on a combined utilitarian ethics and business sustainability standpoint, it would be wise to discontinue marketing Nike products until such time that the issue has been addressed by the supplier.
From the utilitarian ethics view, a decision is made based on which outcome would favor the majority hence there is a need to determine which path leads to more benefits to more people. The availability of Nike to other marketers would mean that customers can just buy them there. This presents a major problem as a myriad of literature indicate that sports shoe customer preferences is highly skewed towards those products which are visually appealing and having performance-enhancing features (Locke 2003, 52). That is to say, customers are not likely to choose an alternative over Nike just because of supplier issues but would instead seek out the product in other stores especially when the features of the shoes are very appealing (Lim and Philips 2007, 146). This would result to shifting customer loyalty resulting to losses in sales consequently harming business operations and employee compensation (Jordaan 2011, 622; Tengblad and Ohlsson 2007, 657).
On the other hand, several high-profile companies such as Starbucks and Apple have also found to their dismay and cost that reputations can be profoundly affected by the environmental and social impacts of their supply networks (Gereffi et al 2005, 101). The negative effect becomes more profound considering the power of social networking to influence customer perception (Carroll and Shabana 2010, 88). Hence, discontinuing sale of Nike products would prevent any negative PR and the accompanying losses especially considering that the company has just adopted the Fair Trade principle. This chosen path can also benefit society in general as it promotes a culture of responsible business practices thru caring for how products are being sourced (Schwartz et al 2007, 506; Wells 2009, 570). However, given the possibility of customers to just seek Nike products on other stores and the strength of the brand, it would be prudent to not totally abandon the brand.
Combining business with ethical practices requires a reconciliation between profitability and ethical principles the company promised to uphold. In this case, the most plausible course of action is to discontinue marketing Nike products until such time that they have sorted out their supplier issues. Abandoning them completely is not an option given their strong marketability.
Andy Carroll & Kevin Shabana, “The business case for corporate social responsibility: A review
of concepts, research and practice,” International Journal of Management Reviews
12(2010): 85–105.
Damon Wells, “Local worker struggles in the global south: Reconsidering northern impacts on
international labour standards,” Third World Quarterly, 30(2009), 567-579.
George Gereffi, James Humphrey & Timothy Sturgeon, “The governance of global value chains,”
Review of International Political Economy 12(2005): 78–104.
John Jordaan, “FDI, local sourcing, and supportive linkages with domestic suppliers: The case of
Monterrey, Mexico,” World Development, 39(2011): 620-632.
Marjorie Schwartz & Andy Carroll, “Corporate social responsibility: A Three Domain.
Approach,” Business Ethics Quarterly, 13(2007): 503-530.
Ronald Locke, “The promise and perils of globalization: the case of Nike, Inc,” in Management:
Inventing and Delivering its Future, ed. T.A. Kochan and R. Schmalensee (Massachusetts: The MIT Press,2003) p. 39-70.
Shane Lim & Justin Philips, “Embedding CSR values: The global footwear industry’s evolving
governance structure,” Journal of Business Ethics 81(2007): 143-156.
Standish Tengblad, & Carol Ohlsson. “The framing of CSR and the globalization of national
business systems: A longitudinal case study,” Journal of Business Ethics, 93(2007), 653-
669. Read More
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