Shoe Dog: 10 lessons I learnt from Nike's Co-founder

Let's start with 3 kickass quotes from Phil Knight: co-founder of Nike

‘Seek a calling.? Even if you don’t know what it means.? Seek it.? If you’re following your calling, the fatigue will be easier to bear, the disappointment will be fuel, the highs will be like nothing you’ve ever felt.’

‘‘It’s just business.’? It’s never just business.? It never will be.? If it ever does become just business, that will mean that business is very bad.’

‘Because mothers are our first coaches.’

Shoe Dog - the memoirs of Phil Knight - Nike co-founder

1.A love of athletics and finance

Phil has a clear & dedicated passion for athletics.??He ran and he raced.

His former coach & mentor turned out to be his chief innovator - Bill Bowerman. As a senior athletic coach, Bowerman also brought early athletics credibility to the start-up that was Blue Ribbon: the pre-cursor to Nike.

Phil's strengths were finance (he qualified in CA) and hiring unconventional talent (who were both super smart and fiercely loyal).? He was quietly, incredibly determined and you get a sense that his 'launch' team were great negotiators.? This was key because Blue Ribbon needed lots of partnerships to grow - from finance to factories.

2. Not that much innovation but two big ones

When I think of Nike, I think of endless innovation, mainly product focussed. Phil Knight started with a simple synthetic running shoe before jogging was a thing in the 1960s. Sometimes innovation is just about finding the right wave and riding it. That's it.

I only saw a couple of ground-breaking innovations in the early days of Nike - the waffle shoe and ‘air’ concept. One from Bowerman and one that was originally pitched to Knight.

What you do see is constant iteration. Sometimes we forget that innovation isn't always about breakthrough but just constant evolution and then one day you look at version 1 and version 9 to see revolution. This is core to software/digital innovation.

3. Relentless execution not flawless though?

In the early days, there was a huge focus on supply chain, team and financial management.?I think this is still critical. This is the Nike Infrastructure that underpins the CX that they are famous for. I remember reading how cashflow challenges almost killed Blue Ribbon/Nike, a few times in the early days.? I'm no finance guru but you see how mega success, ie., huge consumer demand can destroy a company (that looks like a unicorn on paper) when the financial choreography isn't right.

Phil’s accounting training coupled with a leadership team skilled in both detailed project? management and negotiation saved Blue Ribbon/Nike’s bacon on a few occasions. If you are shipping product then supply chain and cashflow remain queen and king.

4. A global mindset from day one

Knight saw the globe as his market from the get go.? His early travels gave him empathy with Japan and that’s where he did his first big deal with a Japanese manufacturer to supply shoes. It tells me that leaders with global experience and insight are key even if the first step is local country focus and growth.

5. Grit.? Nuff said.

Grit.? Shit loads of grit to keep going and overcome diversity on what felt like an almost daily basis through the 70s. That's why I love the quote about having a calling. An almost superhuman resilience comes from having a calling. Something that is much bigger than you and much much bigger than money.

6. You don’t have to be a jock to work at Nike (at least back then)

What is super insightful is that the launch/build/scale team were not all personally connected to the vision through athletics.? Some of the team were far from athletic but they probably would have taken ‘bullets’ for each other.? Definitely ‘corporate bullets’ if not real ones.

I just expected the founding/early team to be runners or athletic types. Phil Knight was a good athlete but not a great one. His relationship with sports coach Bowerman was key but half of the management carried some physical limitations and were far far from athletes.

They all believed in Phil without question and the vision of the company. I think that was enough for Blue Ribbon/Nike. Personally, I believe all founders and early employees need some meaningful connection with the problem they are solving.

7. Business as ‘war without bullets’

Phil Knight loved reading about war and saw business as ‘war without bullets’.? Not sure how well that sits with modern business thinking. Knight was a real 'art of war' type of founder. I think he revelled in both war-like strategy and tactics. It was particularly key when they were once hit by a $25m tax bill allegedly dreamed up by competitors. For Knight, business is battle.

8. An annual company retreat to thrash out the issues

Buttfaces - the annual retreat where the big issues were thrashed out through day and night.? A space for new recruits and old ones to cut loose. Every company I've worked in (about 10 over 28 years) had an annual conference but the Blue Ribbon sessions were pretty full-on and engaging. I love the idea of creating a large sandbox for every employee to have a truly authentic say. Or in the Blue Ribbon/Nike case, a full blown argument. The best start-ups have to brutally honest or they die. This is even more important and much harder as you scale. Trust and openness, now more than ever.

9. Brand status is earnt and not built by advertising (back then)

Phil Knight clearly didn’t believe in advertising in the first 15 years.? Ads were a practical necessity rather than an engine of growth.? Even the shift from the company called Blue Ribbon to the one called Nike was part luck/time/pressure.? Although the story about the Greek goddess of victory (Nike) goes back a few years so perhaps the idea was lying dormant. It does link to Phil's global view of the world both in terms of history and geography. To this day, I believe many a brand and product can derive a positioning from Greek or Roman heritage.

When you think about the Nike brand, there are only 2 or 3 major references to advertising in the book. Anyone who grew up in the 90s and 2000s would recognise Nike for its iconic brand led advertising.

?I think Phil Knight subscribes to the Tim Doyle (co-founder of Eucalyptus, Australia health scaleup) notion of brand status being earnt and not built (through advertising).? Was there a cultural tipping point after 2000 when the scale of Nike’s athletes allowed for powerful brand stories to be told?? Stories that often just amplified the connection between athlete and product that delivered victory. Perhaps the most iconic moment came when Nike Air and Michael Jordan partnered. My take is that Nike started to build an attitude and tone of voice quite early. See this from 1988. Just that the CEO didn't care too much for the work back then except when it linked to a key event like the Olympics and helped sign up more athletes & partners.

I studied Nike's digital innovation strategy last decade during my time at Philips around 2013.? We examined their partnership with Apple, Nike+ in the early days and their first connected products back in 2013.? Did they go back to building customer acquisition and retention through digital products and become less reliant on brand advertising? You definitely saw a shift to using product & especially software to build community and connection. There was a change back then that great advertising amplified great product. The exception then and now continues to be the big sporting event. Did software become the new product fabric (pun intended) in the Nike culture?

10. Product First (always)

Knight was all about the product and using supply chain to get into the hands (& feet) of consumers.??Blue Ribbon was always experimenting via Bill Bowerman and trying to evolve product working with Japanese manufacturers. What Knight learnt from Bowerman was to constantly experiment. Bowerman even tried a shoe made from fish. Not sure about that but the mindset of learning is relentless. Different materials, different tongues and of course, different soles and different cushioning. And this was just in the 60s and 70s!

For Knight the goal was to perfect the product with constant tweaks. Bowerman taught him that athletics is about the seconds and the micro-improvements. These often made the difference between winning and losing. Start to increment the small improvements and you saw big change. Again a big lesson for innovators.

What goes through my head is how the Phil Knight vision and his incredible journey with a ‘band of brothers’ translated into the Nike business and culture post 2000.??

Shoe Dog in a nutshell - belief, one man's passion for athletics, a dedicated team, a razor sharp supply chain, astute financial management and personal sacrifice.? That got Blue Ribbon/Nike from the 1960s through to 2000.? This notion that you build your reputation by the impact you make before the stories that you tell.??For Nike, it all started and finished with product and then created the springboard for brand.

The big brand plays came a little later.

Phil Knight would love to do it all again.? The question is what would be the same and what would be different?

I’d love to hear the perspective of Nike people - especially those in the 90s, 00s as well as more recent.? I’ll nudge the ones I know.