Nike said it will cut 2% of its global workforce as it restructures to more quickly get products in the hands of consumers and respond to a rapidly changing consumer landscape.
“Nike’s leadership and organisational changes will streamline and speed up strategic execution,” the retailer said in a statement, explaining plans of how Nike will also change the reporting divisions of its company.
“The changes are … expected to result in an overall reduction of approximately 2% of the company’s global workforce,” Nike said.
As part of the organisational changes, about 1,400 employees are expected to lose their jobs. Nike reported 70,700 global workers on its last annual report.
In addition to trimming its employee base, Nike has created what it calls a new “consumer direct offense”, or what’s planned to be a faster pipeline to serve shoppers with customisation options.
Trevor Edwards, president of the Nike brand, will head up this division moving forward through integrated category, geography, marketplace, product, merchandising, digital, and direct-to-consumer teams.
To keep its products relevant and make its service more personal, Nike aims to develop what it called a “local business, on a global scale” and focus on serving consumers in 12 key cities, across 10 key countries: New York, London, Shanghai, Beijing, Los Angeles, Tokyo, Paris, Berlin, Mexico City, Barcelona, Seoul, and Milan. These key cities and countries are expected to represent over 80% of Nike’s projected growth through 2020.
To improve efficiency, all key cities and countries are supported by a simplified geography structure, changing from six to four—comprised of North America; Europe, Middle East and Africa (EMEA); Greater China; and Asia Pacific and Latin America (APLA). The leaders of the newly-formed geographies are: Tom Peddie VP/GM of North America, Bert Hoyt VP/GM of EMEA, Angela Dong VP/GM of Greater China, and Ann Hebert VP/GM of APLA.
“Through the consumer direct offense, we’re getting even more aggressive in the digital marketplace, targeting key markets and delivering product faster than ever,” Nike CEO Mark Parker said in a statement.