During a difficult year for the business, Nike just appointed Elliott Hill as CEO, setting an example of a smooth leadership transition devoid of internal strife or interruption to the market.
Employees have a big influence on corporate culture and can affect how well leadership changes go, which makes this smooth leadership transfer particularly important. According to a study that was published in the Strategic Management Journal, there is a negative association between the CEO’s departure and employee approval of their leadership.
As Nike has shown, company executives must talk to and listen to their stakeholders and staff when an organisation is going through a crisis. If this isn’t done, there may be needless retention problems.
This was confirmed by Gallup’s research, which showed that managers could have avoided nearly 25% of employee turnover by addressing the company’s problems.
Setting the tone and expectations for the workplace is the duty of a leader, and capable leaders lead by example. A productive workplace culture where everyone is committed to the expansion of the company can be established with the aid of capable leadership. According to Marshall Terrin, a leadership consultant and company owner, misaligned leadership can cause turmoil, confusion, and a lack of employee engagement, all of which can negatively impact your bottom line.
As the team’s leader, you should motivate them by fostering a positive work environment. Your greatest chance to lead by example will come from your capacity to manage difficult circumstances and lead transitions when necessary. Keep in mind that change is a chance for progress rather than a bad thing, adds Terrin.
Business executives may learn a lot from Nike’s leadership transition and their skillful handling of it. It demonstrates how businesses must have an agile leadership style, be flexible in response to changing weather conditions, and employ creative thinking to foster an environment at work that can endure during transitional phases. Let’s look at three leadership principles from Nike that company executives and entrepreneurs can apply to enhance workplace cultures and manage change.
Execute seamless transitions that take into account all stakeholders
Every time a firm changes, a lot of people are affected. These are the people who have the power to make or break the strategy being implemented in terms of its success trajectory. A few examples of stakeholders who impact the culture and morale of your business are shareholders, suppliers, board members, consumers, and clients. Your stakeholders determine the course that your business will follow, regardless of its size.
Because of this, building trust with people who have a stake in your organisation’s success is crucial to maintaining the stability of your business. You can accomplish this, for example, by focusing your efforts on implementing a seamless transition that takes stakeholders’ perceptions into account. Nike, for instance, showed that they were capable of doing this by choosing not to fire John Donahoe immediately. As an alternative, they decided to keep him on the Nike advisory board through January 2025. This changeover reduced interference and showed consideration for each party.
Determine the season your company is in
It can be difficult for CEOs to navigate change, let alone the additional strain of leading a business through turbulent times. Because of this, experts must identify the stage that their business is in and adjust its course accordingly.
Many firms struggle to innovate and adjust to what the market demands now because they become mired in what succeeded in previous seasons. Even if the past might provide valuable insights for the future, it cannot be the sole success statistic that directs your company’s strategy. This is particularly true for Nike, who realised that although John’s knowledge was valuable at the height of the COVID-19 outbreak, his management approach was out of step with the company’s present needs. In the corporate world, different seasons call for different leadership philosophies, as Nike’s approach to leadership throughout this time proved.
Review effective strategies
Going back and reviewing old techniques that have proven effective is a valuable talent that many firms fail to recognize. This ability is sometimes disregarded since it is thought to indicate a lack of originality, a lack of advancement, or a failure on the part of the leader. These justifications are not true at all. Reexamining previously effective tactics is, in my opinion, an example of what can be done again in the correct situation.
Nike’s decision to replace Donahoe with former CEO Elliott Hill serves as an example of the need to go back to tactics that have proven effective. As the previous President of Consumer and Marketplace, Hill not only had a good track record, but he also had a major role in the company’s growth during his time there. These illustrations show even more how an organisation’s history of effective strategies is a treasure trove of insightful data.
In the context of business leadership, every choice you make counts. Whether you own your own company or are an executive in the corporate world, you will have to make difficult choices. Here’s where choosing your strategy may depend much on whether you choose to consider one of the lessons learned from Nike’s leadership dilemma. Whether you run a Fortune 500 company or a small business, these insights from Nike’s leadership playbook may help you navigate organisational change with conviction and assurance.
(Tashia Bernardus)