Over 90 Per Cent of Nike Layoffs Were Leadership Roles

Nike have announced yet another company-wide layoff. According to an internal e-mail obtained by Complex Sneakers, CEO John Donahoe broke the news that approximately two per cent of their staff will be affected.

‘While interest in sport, health, wellness and comfort has never been stronger, we are in a highly competitive industry where speed and end-to-end execution is critical to win,’ Donahoe writes in the e-mail. ‘To compete, we must edit, shift and divest less critical work to create greater focus and capacity for what matters most.’

This sort of occurrence isn’t a first for Nike. During Phil Knight’s tenure as Nike’s CEO, he had to let go of 1500 people within the span of 10 years. For example, in February 1984, the Swoosh laid off 271 employees who worked at a New England factory and another 26 at Exeter, with the day becoming known as the St. Valentine’s Day Massacre.

That being said, Donahoe's decision to cut a certain number of staff doesn’t mean it will negatively affect the success of Nike given that the brand have gone through a similar transition before. The news was also expected, as company had previously stated layoffs would likely form part of the strategy to save $2 billion over the next few years. It also came after Nike's earnings for the fiscal year was projected to only rise by one per cent.

Elsewhere in Donahoe’s email, he states that Nike are putting their efforts into innovation and investing in their 'most significant fields of play and growth opportunities', such as running, women's offerings, and Jordan Brand. ‘This is a painful reality and not one that I take lightly,' Donahoe adds. ‘We are not currently performing at our best, and I ultimately hold myself and my leadership team accountable. That said, I have never been more confident in our leadership and team to drive the clarity and teamwork required to win.'

The change is expected to happen this Friday, and affected employees will be given financial, healthcare, and outplacement support services packages.