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- May 04, 1992
- Vol. 37
- No. 17
Must Be the Shoes
Nike Creator Phil Knight Made the Sneaker Soar, and He's Determined to Take It Still Higher
So much for corporate image. "I don't consider myself enigmatic," says Knight, "but I don't spend a lot of time thinking about my public persona." Instead the intensely competitive CEO focuses on steering the global enterprise he launched in 1962 by peddling track shoes from the trunk of his car. Not a bad idea. Paying attention to business has made him Oregon's only billionaire.
"Nike for Phil Knight is not something he does. It's something he is," says Julie Strasser, wife of Knight's former marketing director and coauthor of SWOOSH: The Unauthorized Story of Nike and the Men Who Played There, a gossipy chronicle of the company's evolution. In fact Knight, who refused to be interviewed for the book and dismisses it as "a ton of untruths," forged his go-it-alone philosophy while growing up in Portland, the son of a domineering but loving father who was publisher of the now defunct Oregon Journal. Young "Buck" Knight was too puny to play contact sports in high school, so he took up track. When his father refused to give him a summer job at his newspaper, believing that his son should find work on his own, Buck went to the rival Oregonian, where he worked the night shift tabulating sports scores and every morning ran home the full seven miles.
Knight got his introduction to the shoe biz as a middle-distance runner on the University of Oregon track team under the tutelage of legendary coach Bill Bowerman. Intent on helping his runners shave split seconds off their times, Bowerman would cobble shoes with uppers made of lightweight kid leather and, later, nylon.
At Stanford's Graduate School of Business, in 1959, Knight wrote a paper on the athletic-shoe industry—introducing the idea that manufacturing goods in Asia, where labor costs were low, could dethrone such dominant German companies as Adidas and Puma. That treatise became a blueprint for Nike, Inc.
On a trip to the Far East in 1962—a journey that fueled his lifelong passion for all things Asian—Knight discovered a shoe factory in Kobe, Japan, that was manufacturing Adidas knockoffs. Thinking fast, he passed himself off as an American shoe importer interested in their line. Asked the name of his company, he invented Blue Ribbon Sports (after the beer).
Later that year, Knight enlisted a partner, coach Bowerman—who eventually redesigned the made-in-Japan imports—and hired a band of former runners to hawk the shoes at track meets. "We told kids they could run more miles in our shoes," Knight recalls, "and it worked."
To keep the company afloat, Knight, a CPA, taught accounting at Portland State University. There, in 1967, he began dating one of his students, Penny Parks. For decorum, they addressed each other as "Mr. Knight" and "Miss Parks" until they were married six months later. (They apparently developed a greater capacity for familiarity soon afterward, though, since (he couple have two sons, Travis, 18, and Matthew, 22.)
By 1978, when Blue Ribbon officially changed its name to Nike, after the mythological winged goddess of victory, the company was well on its way to earning an animal house reputation. Author Strasser describes the company then as a male-only club governed by frat-house rules, where Knight and other managers—who called themselves buttfaces—were likely to show up at the office in jeans and Hawaiian shirts, but worked at least as hard as they partied, and the company flourished.
As Nike matured, so did Knight, and the buttfaces who could not live in the more structured corporate culture either fled or were fired. Since the company went public in 1980, it has led the athletic shoe race but for a single misstep in 1983: failing to foresee the aerobic shoe craze. One Nike executive dismissed it as a fad for "a bunch of fat ladies dancing to music." The company fell briefly into second place behind Reebok, until Knight, who had left the helm to tour China, returned in 1984.
As CEO, he remains a demanding taskmaster who rewards loyalty and often stalks out of meetings when his patience is taxed. Jack Joyce, a former Nike marketer, witnessed the day Knight met with a committee of efficiency experts who recommended that he fire Joyce. "Phil just said, 'If we were in Japan, you'd have to do the honorable thing, which is to commit hara-kiri.' Then he walked out," says Joyce. "He always stood up for people who were performing."
In 1990 Knight opened his $147 million Nike World Campus headquarters, complete with three restaurants for employees, a jogging track, a discount dry cleaner and a daycare center. In this hive of corporate activity, though, Knight often guards his privacy behind mirrored sunglasses. He pursues his scholarly fascination with Asian history—as well as business—in his inner office. He often greets his secretary with a courtly bow or "moshi, moshi," the Japanese equivalent of hello, and pads around behind sliding screen doors in a pair of cotton slippers.
Knight's only personal concessions to flash are the black Lamborghini (vanity plates: NIKE MN) and red Ferrari in the garage of his five-acre hilltop home, which he shares with Penny, Travis, a cat, two dogs, four ferrets and two horses, whose happiness Penny caters to by piping country and western music into their stables.
Rather content himself, but not complacent, Knight is warming up to win his next race—driving international sales beyond last year's $2 billion domestic figures. "This is a guy who chases dreams and catches them," says one former Nike man. "I have never seen him look back, even when he goes for a run."
SUSAN HAUSER in Beaverton
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