The paper “ Nike’ s Corporate Social Responsibility, Cross-Cultural Management, and Cultural Dimension” is a breathtaking version of the case study on the management. Globalization has brought about different changes over the last year. Different countries now do trade freely without the restrictions that existed in the past (Welch and Bjorkman, 2015). Currently, more and more firms are opting to internationalize more rapidly than ever before. With globalization and liberalization, it is not difficult for multinational companies to enter into new markets (Welch and Bjorkman, 2015). The entry of multinational companies into international markets can be found to be beneficial for foreign companies and to the domestic market.
Although internationalization has brought about many benefits, companies operating overseas are faced with cultural issues. In order to be competitive and survive in the international market, organizations have incorporated corporate social responsibility and other ethically aware operations (Pompper, 2015). Corporate social responsibility is used by companies not only to increase profitability but also to reduce both the environmental and social effects of business processes (Smith, 2003). One company that has embraced CSR is Nike which has led to its growth in the international market.
This paper will highlight, with the use of relevant theory and media articles, how Nike has incorporated corporate social responsibility that has enabled it to succeed in the international market. Corporate Social ResponsibilityCorporate Social Responsibility has a strategic significance in the business world for organizations and governments alike (Hagendorff and Clacher, 2012). It is a critical issue in today’ s business world, thus many organizations set apart significant resources in carrying out Corporate Social Responsibility. Corporate social responsibility has been linked to enhanced profitability and the value of an organization (Kotler and Lee, 2011).
Nike has embraced corporate social responsibility which has led to its success in the international market. It has enabled the company to gain customers’ and society, trust and has enhanced its brand image and recognition. The Invisible Hand TheoryThe purpose of corporate social responsibility is to do good not only for the company but also for people and the environment (Kaushik, 2010). According to the invisible hand theory, under capitalism, companies that pursue good for their companies also pursue good for their communities (Kaushik, 2010).
Therefore, multinational companies have benefited the world economy through offering employment, new technology, and infrastructures among others. The economy is effective when people are left to trade freely among themselves (Thornton, 2009). Businesses that look for profit end up benefiting the community as well. The invisible hand theory may work for Nike. Nike has been among the market leaders in many countries. However, their operations were faced with criticism from the public. In order to ensure change, consumers protested outside their Nike stores in allegations of child labor and poor working conditions for employees (Newell, 2015).
As a result of the reaction from the public, the company promised to change. Profits and Shareholder TheoryAccording to the profit and shareholder theory, the main aim of the companies is to increase profits (Fontrodona and Sison, 2006). The theory illustrates that managers are hired as shareholder agents who are required to operate the business and serve the interest of the shareholders. Over the years, Nike has been considered as having a shareholder focus due to its interest in making a profit.
However, their shareholder focus led to failure due to the neglect of other stakeholders such as the customers and employees (Newell, 2015). The shareholder theory is considered a traditional way of doing business as it brings about disadvantages due to full concentration on the shareholders (Fontrodona and Sison, 2006). Nike has realized that in order to succeed, there is a need to change its strategy and incorporate corporate social responsibility in their operations. It is not enough to only focus on making a profit while ignoring the needs of the society around.