The Sweatshop Argument analyzes the legal, ethnic and ethical challenges confronted by global organization and will also look at the jobs that web host governments have got played while summarizing the strategic and operational issues facing global managers by Nike. Having standards in place will protect the organization from a major catastrophe like the one formally faced by simply Nike.

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Philip Knight and Bill Bowerman created the world’s largest sportswear company, Nike, in 1962. Nike at this point controls a lot more than 40% in the U. S i9000. Market to get sports related items.

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However , Nike does not have one main shoe manufacturer in the United States (Miller, 1995). As Nike is constantly on the make millions, they always employ staff from abroad and paying them very little wages and requiring extended stays without overtime pay in their factories. The controversial concerns are so why the majority of Nikes labor can be conducted in Third World countries. Nike subcontractors employ practically 500, 500 workers in plants positioned in Indonesia, China and Vietnam (Saporito, 1998).

Many challenges must be considered within the case study of which various include legal, cultural and ethical dissimilarities.

“The majority of Nike shoes are produced in Indonesia and Chinese suppliers, countries with governments that prohibit impartial unions and place the lowest wage by rock bottom (Hill, 2009, l. 155).  When speaking about ethics, Third World countries possess a different normal on precisely what is ethical with regards to working conditions, wages and labor techniques. The average pay out in Philippines of a Nike factory employee in 1997 was $2. 46 per day. Labor groupings estimate a livable wage is about $4 a day in Indonesia. In Vietnam, the pay is usually $1. 62 a day. The average living salary is about $3 a day in Vietnam (Hill, 2009). In comparison to the United States this wages are extremely low in comparison to the total cost of living. Considering these pay, Nike need to question the legal, social and honest implications of its global workforce guidelines and procedures.

Nike was involved in low-cost labor practices, which were not regulated by the governments during these other countries, which in the conclusion played an important role in the case at hand. America has certain labor salary that must be adopted which are arranged by the authorities. If these types of foreigngovernments might have minimum wage requirements this kind of whole problem would never exist and the kid labor laws and regulations would get rid of the use of children for 14 cents per hour to produce merchandise. Nike need to concentrate more on performing what is right to protect their very own reputation.

Strategic challenges in this case study with Nike can be ensuring that buyers can get the same quality goods from everywhere across the globe and making the Nike customer aware what the company is doing to ensure that their contractors and subcontractors are compliant with Nike’s guidelines and honest standards.

Operational challenges happen to be ensuring that every single manufacturing plant provides similar functioning conditions whether or not the factory with the US or in a Third World nation. In addition to the stock conditions, Nike needs to make certain that every employee receives good wages around the world, global training and advancement programs, and implementing guidelines to improve workers rights.

Nike has the ability to merely continue to execute business worldwide while adhering to ethical regulations. Nike has made progress in the past few years by ensuring less dangerous working conditions and focusing on corporate responsibility.

Nike need to continue to screen the companies, government authorities, and workers with whom they do organization to ensure the reputation of the organization is not totally ruined. Facing another main crisis similar to this could be the end of a successful organization and may also bring about the loss of many major movie star sponsors. Often doing the proper thing should be in the back of the CEO’s of Nike brains to ensure that this type of thing never happens again. Having standards will only raise the benefit of the organization and lead to larger volume of product sales and in the outcome in better revenue intended for the organization. Take action RIGHT!

Research

Slope, C. W. L. (2009). International organization: Competing inside the global market place (7th male impotence. ).

Boston: McGraw-Hill Irwin.

Saporito, Costs (1998, 03, 30). Can Nike Receive Unstuck? Recovered 10 13

2008, from http://www.time.com/time/magazine/article/0,9171,988058,00.html?iid=digg_share

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