Nike Strikes Gold with Lean Manufacturing

Adi Gaskell

The manufacturing operations at sportswear company Nike have been under frequent scrutiny for decades after allegations that it utilised sweatshops to manufacture its products in the 1970's.

This negative publicity prompted a response from Nike to the allegations. In 1992 it established a code of conduct for suppliers, whilst in 1996 they helped create the Apparel Industry Partnership, which drew up a code of conduct for factories, and in 1999 evolved into the Fair Labour Association.

Their manufacturing has been in the news for an altogether more positive reason this week. Their FY10/11 Sustainable Business Performance Summary document outlines the tremendous results the company has seen from an adoption of lean manufacturing throughout its factories.

The document outlines how applying a lean approach has produced better manufacturing that reduced both wasted materials and wasted time, therefore ensuring their supply chain has operated more efficiently.

The report explained the company had worked to eliminate waste, lost time and lost material from its processes as part of its sustainability agenda.

Amongst the improvements seen at Nike are:

  • A 50% reduction in defect rates
  • 40% faster lead times
  • 20% improvement in productivity
  • 30% reduction in time taken to introduce a new model

Mark Parker, CEO and President at Nike, said in a statement:"Sustainability at Nike means being laser-focused on evolving our business model to deliver profitable growth while leveraging the efficiencies of lean manufacturing, minimizing our environmental impact and using the tools available to us to bring about positive change across our entire supply chain."

Whilst the ethical spotlight will undoubtedly remain on Nike's manufacturing, it is nice to see it hitting the headlines in a slightly more positive way. Long may it continue.