New Nike CEO: Layoffs looming as sneaker giant launches simplification plan


Oregon’s largest homegrown company will become smaller in coming months as new CEO John Donahoe launches a sweeping reorganization aimed at making Nike more efficient.

It’s not clear how many jobs will be cut. Nike indicated the layoffs will be phased in over the course of the summer, fall and perhaps beyond.

Employees learned of the downsizing Thursday in an email from Donahoe. He said that during a multi-week listening tour he heard repeatedly that Nike’s internal structure had become too complicated to get things done.

“The most frequent request I heard from you – by far – was your ask to simplify how we work,” Donahoe said in an email first reported by the news site Complex. “Across the entire company, it was clear that we need to reduce complexity and increase speed and responsiveness.”

Nike reported disappointing quarterly financial numbers Thursday, but Donahoe said the pending layoffs are not related to those poor results.

No one expected the company to enjoy a good quarter in the midst of a global pandemic. But few expected the company’s sales to decline by 40% or its losses to surpass $700 million.

Shares were down more than 7% Friday morning at $94.21. The stock has traded between $60 and $106.62 in the past year.

The reorganization isn’t about cutting costs, Donahoe said. It is intended to create a better environment for completing important tasks. Th subject line on his email to employees, a copy of which was obtained by The Oregonian/OregonLive, read “Transforming Nike Faster.”

“Our Employee Engagement Survey from earlier this year reaffirmed the same thing,” Donahoe said in his email. “Many of you share concerns about how hard it is to get work done: Siloed work. Too many approvals needed. Complexity and duplicative resources resulting in a lack of accountability. An overburdened matrix.”

The company will realign itself into three product categories — men’s, women’s and kid’s. Donahoe said there are large, untapped opportunities in the women’s and children’s businesses.

Donahoe said he will offer additional details at an all-company meeting Tuesday.

“These decisions are exceptionally difficult because they impact friends and colleagues at Nike,” he wrote in the email. “You have my personal commitment that we will put people at the center throughout this entire process. We will support everyone impacted by this transition.”

Jeff Manning

971-263-5164

jmanning@oregonian.com



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