Leading Organizations - Essay Example

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Discuss why Nike and other organisations known to you have become leading organisations in their industries. You should include discussion of organisational control and influence over the external environment in your answer.
Today's business environment is increasingly becoming more turbulent, chaotic and challenging than ever before and to survive, it is vital that a firm can do something better than its competitors ( Kanter 1995)…
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Leading Organizations
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Download file to see previous pages According to Kanter (1995) such an action will not constitute an adequate response. This is so because, success is based on an organisation's ability to create, rather than predict the future by developing those products that will literally transform the way the world thinks and view it self and the needs (Kanter 1995:71).
Within the context of today's global competition, businesses and firms no-longer compete as individual companies but try to corporate with other businesses in their activities (Wu & Chien 2007:2). These researchers further argue that, this strategy has become quite common in many businesses today. The conventional vertical integrated company based business model is gradually being replaced by collaborative relationship between many fragmented, but complementary and specialized value stars and constellation (Wu & Chien:1).
An alternative approach towards organisational success, one which is becoming increasing prominent and has attracted the sustained attention of both domestic and international business scholars are core competences, capabilities and resources (e.g. Madhok 1998, Prahalad & Hamel1990, Hamel & Prahalad1994 ). In today's global business environment it is no longer sufficient simply to meet customers demand as time quality and cost have become increasingly important in the phase of increasing competition (Petts 1997:551).

According to Higgins (1998:2), "customers don't always know what they need or even that there is a problem to be solved." Success awaits those companies that recognize the fact that, to be successful and satisfy customers, it is often necessary to lead customers into recognizing these needs (Higgins 1998:2-3). This is what Nike and a host of other leading brands have been doing. In the next section, using the five forces framework of Porter (1980), I will diagnose the Nike brand to see the company's control over suppliers, competitors, competitive rivalry etc.

1.2 Nike and Porters Five Forces Model

According to Porter (1980), argues that understanding of the sources of competition in an industry was vital in developing an organisation product advantage. As shown in the five forces frame work, Porter further states that, five forces were vital in shaping the nature of competition in an industry, and at the same time dictate the company's advantage through the nature of the relationship with the market participants. In the industry in which Nike operates rivalry is not fierce though there are many niche players, with direct competition coming from Addidas. Nike through the five forces has a higher bargaining power when compared to its competitors, suppliers and customers, because of the brand equity.

With a relatively high profit margin, in the sector to attract potential competitors or new entrants, the situation is however difficult for new entrants to enter the line of business, because huge capital, and capabilities to support after sales services are vital too. Through an ...Download file to see next pagesRead More
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