Nike and Adidas both hail from an industry I’ve spent my career in, and I have had the pleasure of doing business with both Adidas and Nike. The issue around the non-compete agreement, and the complexity of the overall situation is interesting.
The Human Resource Management issues range from strategic (supporting Adidas in its quest to gain back lost market share) to detailed (employment contracts, and compensation details). This is a rich situation with varied implications for the previous employer, the employees, and the current employer.
HRM Issues and Implications | Nike Inc., the previous employer
A small group of top employees leaving together highlights the challenge inherent in forecasting external demand for talent. Environmental scanning, in this case for competitive/market trends, is difficult to do. Adidas, Nike’s top competitor, is motivated to bring their sales and market share to higher levels previously enjoyed. With vast resources and a strong brand, Adidas can spend time recruiting talent from other blue-chip organizations, and make competitive or better offers.
On a regular basis, the two companies will have talent moving between them. Mark Milner himself spent almost two years at Adidas (Milner, 2015) prior to joining Nike. In this case, Nike may not have anticipated the team of three leaving at once, and heading to a single other company to disrupt the market.
The second issue is whether these senior designers were engaged in their roles at Nike. “Engaged employees feel a vested interest in the company’s success and are both willing and motivated to perform to levels that exceed the stated job requirements” (Dressler et al., 2014, p. 432). The actions the organization is accusing them of - including copying sensitive design and business documents (Chung, 2014), approaching the competition, etc. - would indicate the opposite. At first glance it seems that Nike did not do enough from a career planning and retention perspective for these three.
The third and current issue affecting HRM at Nike is whether this higher profile departure, and subsequent lawsuit will affect the company’s climate and culture. In 2012, Nike had 6,624 full-time employees at its Oregon World Headquarters (Brettman, 2014), where the three designers were based. Its impact on anyone but their direct teams and designer / director group would be minimal.
However, Nike does not want to continue to lose top talent to one particular competitor. According to textbook author’s Gary Dessler, Nita Chhinzer, and Nina Cole, career planning “can play a significant role in retaining employees” and “reducing turnover of valued workers” (Dessler et al., 2014, p. 239). There are few top-level positions to promote high-value employees into. But employees value a total rewards approach including career-growth opportunities (like transfers, job expansion, or horizontal loading which will better prepare the company’s future leaders), a high quality of work, recognition and work climate (Dessler et al, 2014, p. 296). Nike must continue to provide / extend these additional opportunities in career planning for its top employees.