Nike Inc is to streamline its organisation – including its corporate leadership team – as the sporting goods firm looks to become a nimbler, flatter organisation.
In an update yesterday (22 July), Nike announced a series of senior leadership changes to support its Consumer Direct Acceleration (CDA) initiative launched in June to “digitally empower” the company for long-term growth and profitability.
As part of this, Nike said changes to its operational model to fully align against the CDA are expected to lead to a net loss of jobs across the organisation, although it didn’t specify how many. The company expects to record one-time employee termination costs of around US$200-$250m.
“We are announcing changes today to transform Nike faster, accelerate against our biggest growth opportunities and extend our leadership position,” said John Donahoe, president & CEO. “Now is the right time to build on Nike’s strengths and elevate a group of experienced, talented leaders who can help drive the next phase of our growth.”
A shift to a new, simpler consumer construct of men’s, women’s and kids will allow Nike to create product with deeper insights and drive even greater specialisation through performance sport and sport lifestyle, the company says. As such, Amy Montagne, most recently leading the entire global category portfolio, becomes vice president/general manager of men’s, while Nike veteran Whitney Malkiel becomes vice president/general manager of women’s. McCallester Dowers becomes vice president/general manager of kids, and all three will will report to Michael Spillane, who becomes president, consumer creation.
In the Nike brand’s geographic operating segments, Carl Grebert, most recently vice president/general manager, APLA, becomes vice president/general manager, EMEA, succeeding Bert Hoyt, who will retire from Nike later in 2020 after 22 years with the company. Sarah Mensah succeeds Grebert becoming vice president/general manager, APLA. Ann Hebert and Angela Dong will remain the vice president/general managers, North America and Greater China geographies, respectively.
The CDA is designed to create “a more premium, consistent and seamless consumer experience” across Nike’s owned and strategic partner ecosystem, align around a new simpler consumer construct and also unify investments in an end-to-end technology foundation to accelerate digital transformation.
Nike was hit hard in its fourth-quarter as store closures and a 38% drop in sales pushed it to a loss. For the three months to 31 May, the company swung to a quarterly loss of $790m, compared with net income of $989m a year earlier, while revenues fell 38% to $6.3bn.