Create the Future: taking a Nike reorganization to the retailer, account by account

What it is

Create the Future was the work of Nike's global merchandising leadership team to define a future for the merchandising function. Khounlavong did not design it. The program strengthened category merchandising and expanded a marketplace merchandising function, which built assortments for accounts and for clusters of stores.

The internal case was direct. In a Nike survey across product, merchandising and sales, everyone gave a different answer on who owned assortment decisions. Sales teams were spending one day a week building assortments. The doors already on directed assortments had grown above 20%. All other doors had grown below 10%.

Khounlavong went through the change himself. His notes of February 2016 record the move from Category Footwear Merchandising Director to Marketplace Merchandising Director. The internal material was written for Nike leaders. Its presenter notes asked that it stay inside the leadership group.

What Khounlavong did

• Carried the program to four account bases in sequence. The account versions in his files are dated January 2016 for Finish Line, February 2016 for the city specialty accounts, April 2016 for Shoe Palace, and June and August 2016 for Hibbett Sports.
• Edited the city specialty version for a retailer audience. His slide comments record the changes. He changed "efficiency" to "productivity & profitability." He changed "strengthen category merchandising" to "power up the global offense." He cut slides he judged too heavy with text and merged two into one page titled "What this means for your business."
• Proposed renaming the function "X-Category" to make it more retailer facing. The final deck of February 23, 2016 kept the name Marketplace Merchandising.
• Briefed his team before the Las Vegas meeting to lead with a vision and a strategy whatever their slot in the agenda turned out to be.
• Showed the accounts the same new seasonal process. It ran in five gates: review the prior year, set the seasonal strategy and vision, align the assortment to the cluster, finalize direction and investment, and confirm.
• Gave Finish Line a three season transition. Fall 2016 was to engage, listen and absorb. Holiday 2016 was to build the blueprint and test the new process. Spring 2017 was to assort to cluster and work across categories.
• Stated the ask and the return in the same terms at Finish Line, Hibbett Sports and Shoe Palace. The retailer supplied floor plans and capacity for its muse doors. Nike delivered an assortment planned to that capacity, with a retail plan. A muse door is the one store an assortment is planned against.
• Told Hibbett Sports what the change would not be. His note read: "We will not be prescribing everything."
• Grew from one direct report to four during the year, and hired for the new merchant roles.

Results

• The final city specialty deck carried his wording to the retailers: "productivity & profitability," "power up the global offense" and "What this means for your business."
• Khounlavong's fiscal 2016 review marks the implementation of Create the Future as in process at year end. It marks the door cluster framework and the city specialty strategy as completed.
• His career profile of May 2016 describes the work in the present tense: driving the new Create the Future process to drive productivity and profitability, across three channels, mall, city specialty and sporting goods.
• Raised productivity and profitability 35% across three key retail partners. This line is confirmed by Khounlavong. No Nike document carries the figure.
• Sped up the new functional process so that product landed 10 days before launch. This line is confirmed by Khounlavong. No Nike document carries the figure.

At a glance