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The Analysis Of The Company: Adidas

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Introduction

Within this research paper, you will discover the world of Adidas through its: history, founders, logo, motto, structure, type of organization and many more. The paper will briefly cover the facts about each topic mentioned above.

Founder and History

The company had its fair share of hard work when it started emerging. The company now known as Adidas AG, was previously part of “Gebrüder Dassler Schuhfabrik”, which was founded by Adolf Dassler and his brother Rudolf Dassler used to run together. The AG in Adidas AG stands for “Aktiengesellschaft” which is a German term for public limited company (Kagan, 2018). The brothers formed a partnership to run the company. They used to complement each other very well. Adi used to be a craftsman who used to optimize shoes, while his brother used to be a loudmouthed salesman, making them a perfect fit for each other. They used electricity required mechanisms during the production of their shoes, and the source of electricity wasn’t stable in small Bavarian town of Herzogenaurach. In order to ensure production, they used to use a bicycle attached to a generator to produce electricity, by pedaling the bicycle, required for the machines (James, 2006).Their company becomes famous and successful after 1936 Olympics. On this year, they offer their product to Jesse Owen, who then wins Olympic gold medals, proving the quality of the shoes. Later on, the brothers split. Rudolf founds in 1948 “Puma” and sells the famous Puma ATOM shoes (PUMA SE, n.d.). Adi becomes the founder of the world famous Adidas at the age of 49 in 1949 (Adidas, n.d.). The headquarters of both companies are located in the town where it all started, the small town of Herzogenaurach.

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Logo

A logo can be stated as the face of the company. Adidas has created a logo that represents its constant struggle to perfection by athletes which can be seen by its mountain style three stripes logo representing elevation. It can be said for sure that anyone can recognize the logo from far distance and tell that it belongs to Adidas. This type of identification feature is what every company craves and what Adidas has achieved (Logaster, n.d.). Thought, it did not turn into a familiar symbol to people in one night. Adidas has changed it logo more than once, but always kept the three stripes. According to Kim Bhasin (2017), Adidas uses the 3 stripes on each of its products and it is always ready to bring anyone who uses the similar design to court, proving that Adidas also knows its symbols worth.

Motto

A motto is a word or a phrase that expresses belief or purpose of something or somebody (Cambridge, n.d.). Adidas had one of the most famous and striking motto in the world that was endorsed by Muhammad Ali in peak of his career. Their motto was “Impossible is Nothing”. Through this phrase they wanted to show that they can produce the best products and that people who use their products will never know what is impossible (mainly directed at athletes). Even so, Adidas was not afraid to change their motto in the recent 2013 to “Adidas is All In”. This shows that Adidas, no matter what kind of challenges it faces will stand against it and never back down, which shows why it is ranked number 2 in the world (Waiz, 2019).

Mission Statement

Mission statement is the long term goal of a company, which shows what the company is thriving for and what it wants to be in the future (BusinessDictionary, n.d.). The mission statement of Adidas is fairly simple and clear as it states that it wants to be: “the best sports company in the world”. If you pay attention carefully, it says “sports company” but not have the best sportswear. Adidas wants to point out that it does not want to limit itself with increasing the quality of its products, but it also wants to make its consumer services also a top ranking one – by connecting and engaging with their consumers (Adidas Group, n.d.) .

Products

Adidas produces mainly three types of products: footwear, pieces of apparel and sport equipments. The company according to 2018 statistics boast almost a billion (900 million) of units being sold from those 3 types of units around the globe. The company is mainly famous for its shoes, which initially brought it fame and fortune. Lately, Adidas is focusing on making its products and material used for products environment friendly and sustainable, which can be seen by it being selected for the 19th consecutive time as Dow Jones sustainability indices. (Adidas Group, n.d.)

Competitive Advantage

Every company has an advantage over the other in some way. The competitive advantage of Adidas lays in its marketing, international relationships, and accessibility. The company has a great marketing strategy, which lies in its logo that has been for a long time, and in the mind of the consumers it represents products of high quality. Adidas has good ties with international labor organizations, international finance organization and other large corporate entities that make it easier for them to open in different markets. Finally, its biggest advantage is its accessibility. Adidas has more than 2400 shops all around the world, making it easier for their consumer to buy their products. (Bhasin, 2017)

Ownership and Organizational Structure

The property of the company may be variable depending on the indicator of the shares in the long-term and short-term period. The decisive factors for a long-term investor are the various consequences in the management system caused by the amount of capital coming from an active and passive institution. Short-term investors also take into account the fact of changes in the trading environment of the company, caused by these revenues. The main owners of Adidas are divided into four such as institutions, insiders, the public and a private companies.

Institutions own a 50.23% stake in Adidas, sufficient to change stock prices if sales and purchases are made during a period when only a small number of packages are available. Another type of owners is insiders that may be the main party that makes important key decisions related to the use of capital. In short, insider ownership is more connected with the adoption of agreements on the interests of shareholders with superiors.

Only 4.98% of Adidas shares may belong to insiders, but this is still significant ownership if you consider the fact that it consists of a large-cap stocks. A more significant level of ownership of the insider can be sent to management, which, instead of carrying out projects to increase obvious growth, supports projects associated with high returns.

The 41.18% stake in Adidas is owned by the general public, which makes it popular and gives retail buyers the opportunity to become a shareholder. Such sizes of ownership make it possible to join the game of politics in the company, which at the same time affects the income of shareholders, including its role in deciding the remuneration of the executive bodies and appointing the director. Public owners have the right to refuse mergers and acquisitions, which in the future may contribute to a decrease in profitability.

Another equally important type of management system is private companies, a group of owners of potential investors owning a 3.61% stake in Adidas. In the list of such companies, the main ones are those who act because of their strategic interests whose goal is to obtain the benefits from the shares, increasing their capital through the investments belonging to them. But owning such a small stock size may not be enough to be able to participate in changing the company’s business strategy.

One of the business owners’ key tasks is to choose the correct and appropriate organizational structure that gives a company’s flourishing. The hierarchical organizational structure selected by Adidas sportswear company is better suited to the managing environment. In a hierarchical organizational structure, there are Top level management, middle level, and first level managers.

The top position comes with the Chief Executive Officer or CEO which is the highest position in the business, who is the company’s largest employee and the one accountable for all the company’s accomplishments and losses. In Adidas, this position since 2016 belongs to Kasper Rorsted. Further goes the head of different divisions who controls their own field but directly respond to CEO:

  • CFO – HARM OHLMEYER
  • Chief corporate communications officer – JAN RUNAU
  • General Counsel – JAN HEINEMANN
  • Global Head of Brands – ERIC LIEDTKE
  • Head of Public Relations – KAREN PARKIN
  • Global Operations – MARTIN SHANKLAND
  • Global Sales – ROLAND AUSCHEL

Chairman of Board considered as a second largest position and is also the company’s senior-level position. In the business, the chairperson has a supervision or decision-making position. In order to reach this position, one requires not only experience but also abilities and expertise. The job of these executives is to handle multiple tasks involving the effective use of funds and to guide staff in the correct direction. The vice chairperson of the board comes after the chairman. Directly throughout the departments, the vice chairman of the board guarantees that they work properly. The main duty of The Vice President of the Board is controlling board-related operations and being involved in the company’s significant decision-making. Sabine Bauer since 2010 is the Vice-chairwoman of the supervisory board, an employee representative. Since 2009 Igor Landau holds the position of Vice chairman of the supervisory board (Adidas – Group, n.d.). Then goes the member of Supervisory Board who considers as a first level manager. This category includes team leaders, office executives, head of the crew, head of department and supervisors. They are directly responsible for the organization’s job activities and daily goals. They take instructions from the middle executives and work directly with staff and workers. They speak on a regular basis with staff, workers, workers, and staff take updates, fix inner problems, and are part of the department for disagreement and complaints. They are also involved in recruiting and employing staff and managers (Hierarchy, n.d).

Reference

  1. Adidas Group (n.d.). Media. Available at: https://www.adidas-group.com/en/media/media-center/ [Accessed 9 Jun. 2019].
  2. Adidas Group, (n.d.). Profile. Available at: https://www.adidas-group.com/en/group/profile/ [Accessed 9 Jun. 2019].
  3. Adidas. (n.d.). History. Available at: https://www.adidas-group.com/en/group/history/ [Accessed 9 Jun. 2019].
  4. Bhasin, H.(2017). Marketing strategy of Adidas. Available at: https://www.marketing91.com/marketing-strategy-of-adidas/, [Accessed 9 Jun. 2019].
  5. Bhasin, K. (2017). Adidas trademark war means three stripes and you’re out. Available at: https://www.livemint.com/Companies/WPqL3wmMWNG8N3Csi5Ay7O/Adidas-trademark-war-means-three-stripes-and-youre-out.html [Accessed 9 Jun. 2019].
  6. Hierarchy Structure. (2019). Adidas Corporate Hierarchy | Adidas corporate structure. Available at: https://www.hierarchystructure.com/adidas-corporate-hierarchy/ [Accessed 9 Jun. 2019].
  7. James, K. (2006). The Town that Sibling Rivalry Built, and Divided. DW. Available at: https://www.dw.com/en/the-town-that-sibling-rivalry-built-and-divided/a-2074427 [Accessed 9 Jun. 2019].
  8. Kagan, J. (2018). AG (Aktiengesellschaft). Investopedia. Available at: https://www.investopedia.com/terms/a/ag-aktiengesellschaft.asp [Accessed 9 Jun. 2019].
  9. Logaster. (n.d.). The Adidas Logo. [online] Available at: https://www.logaster.com/blog/adidas-logo/ [Accessed 9 Jun. 2019].
  10. PUMA SE. (n.d.). PUMA’s History. Available at: https://about.puma.com/en/this-is-puma/history/history [Accessed 9 Jun. 2019].
  11. Waiz, S. (2019). The Adidas Slogan: All You Need To Know. Advergize. Available at: https://advergize.com/advertising/adidas-slogan/ [Accessed 9 Jun. 2019].

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