Organizational Structure

The organizational structure of Nike Inc. most closely resembles that of the divisional structure. A divisional structure is characterized by internally grouped products, projects, or product markets. Nike follows this organizational structure in the way that they group their divisions according to each sport. For basketball, soccer, golf, and track, among other sports, there is a branch of accounting, finance, marketing and research and development. This is an advantage for Nike because they are such a large corporation that splitting up their divisions is necessary to efficiently and more effectively run the organization.

Within each division, decisions are made that affect products, but generally only in their sport or division. While there is some communication between channels, sports, and divisions, they are separated in this way so that there is collaboration within sport. This also allows employees in each division to act as experts in their segment, leading to more successful products, as they know what is needed in the marketplace, as well as what has been happening in the industry of their sport.

While this organizational structure can be expensive, with accounting and finance segments for each sport, Nike is able to finance this and believes that the way the run their business adds more value to the organization than it costs. If they had one finance, accounting, or research and development team for Nike as a whole, there would be way too much to do, and not enough people to successfully get the work done. Even with enough people, there would be complications with splitting accounts up among employees, whereas with the divisional structure, it is clearly laid out to employees which sport and accounts they deal with.

In a large corporation like Nike, it is important that the structure works effectively and efficiently for them, and follows the strategy that is laid out throughout the organization. In Nike's case, this is true, as they focus on product lines that are specific for different sports. Therefore, it makes sense to structure their organization in this way as well.