Shoe Dog (35 page)

My new head of apparel.

I retreated that day to my baseball-mitt chair and stared out the window for a long, long time. Sports things.

I knew what was coming. And, oh, it came.

A few weeks later Nelson stood before us and made his formal presentation of the first-ever line of Nike apparel. Beaming with pride, grinning with excitement, he laid all the new clothes on the conference table. Soiled workout shorts, ragged T-shirts, wrinkled hoodies—each putrid item looked as if it had been donated to, or pilfered from, a Dumpster. The topper: Nelson pulled each item from a dirty brown paper bag, which looked as if it also contained his lunch.

At first we were in shock. None of us knew what to say. Finally,
someone chuckled. Strasser, probably. Then someone haw-hawed. Woodell, maybe. Then the dam burst. Everyone was laughing, rocking back and forth, falling out of their chairs. Nelson saw that he'd goofed, and in a panic he started stuffing the clothes back into the paper bag, which ripped apart, which made everyone laugh harder. I was laughing, too, harder than anyone, but at any moment I felt as if I might start sobbing.

Shortly after that day I transferred Nelson to the newly formed production department, where his considerable accounting talents helped him do a great job. Then I quietly shifted Woodell to apparel. He did his typically flawless job, assembling a line that gained immediate attention and respect in the industry. I asked myself why I didn't just let Woodell do everything.

Including my job. Maybe he could fly back east and get the Feds off my back.

AMID ALL THIS
turmoil, amid all this uncertainty about the future, we needed a morale booster, and we got it at the tail end of 1978, when we finally brought out the Tailwind. Developed in Exeter, made in Japan, the brainchild of M. Frank Rudy was more than a shoe. It was a work of postmodern art. Big, shiny, bright silver, filled with Rudy's patented air soles, it featured twelve different product innovations. We hyped it to the heavens, with a splashy ad campaign, and tied the launch to the Honolulu Marathon, where many runners would be wearing it.

Everyone flew out to Hawaii for the launch, which turned into a drunken bacchanal, and a mock coronation of Strasser. I was transitioning him from legal to marketing, moving him out of his comfort zone, as I liked to do with everyone now and then, to prevent them from growing stale. Tailwind was Strasser's first big project, so he felt like Midas. “Nailed it,” he kept saying, and who could begrudge him a bit of chest-thumping. After its wildly successful debut, Tailwind
became a sales monster. Within ten days we thought it might have a chance of eclipsing the waffle trainer.

Then the reports began to trickle in. Customers were returning the shoe to stores, in droves, complaining that the thing was blowing up, falling apart. Autopsies on the returned shoes revealed a fatal design flaw. Bits of metal in the silver paint were rubbing against the shoe's upper, acting like microscopic razors, slicing and shredding the fabric. We issued a recall, of sorts, and offered full refunds, and half of the first generation of Tailwinds ended up in recycling bins.

What began as a morale booster ended up being a body blow to everyone's confidence. Each person reacted in his own way. Hayes drove in frantic circles on a bulldozer. Woodell stayed longer each day at the office. I toggled dazedly between my baseball mitt and my recliner.

In time we all agreed to pretend it was no big deal. We'd learned a valuable lesson. Don't put twelve innovations into one shoe. It asks too much of the shoe, to say nothing of the design team. We reminded each other that there was honor in saying, “Back to the drawing board.” We reminded each other of the many waffle irons Bowerman had ruined.

Next year, we all said. You'll see. Next year. The dwarf is going to get Snow White.

But Strasser couldn't get past it. He started drinking, showing up late to work. His mode of dress was now the least of my problems. This might have been his first real failure, ever, and I'll always remember those dreary winter mornings, seeing him shamble into my office with the latest bad news about his Tailwind. I recognized the signs. He, too, was approaching burnout.

The only person who wasn't depressed about the Tailwind was Bowerman. In fact, its catastrophic debut helped pull him out of the slump in which
he'd
been mired since retiring. How he loved being able to tell me, to tell us all, “Told you so.”

OUR FACTORIES IN
Taiwan and Korea were humming along, and we opened new ones that year in Heckmondwike, England, and Ireland. Industry watchers pointed to our new factories, and our sales, and said we were unstoppable. Few imagined we were broke. Or that our head of marketing was wallowing in a depression. Or that our founder and president was sitting in a giant baseball mitt with a long face.

The burnout spread around the office like mono. And while we were all burning out, our man in Washington was flaming out.

Werschkul had done everything we'd asked of him. He'd buttonholed politicians. He'd petitioned, lobbied, pleaded our cause with passion, if not always with sanity. Day after day he'd run up and down the halls of Congress, handing out free pairs of Nikes. Swag, with a side of swoosh. (Knowing that representatives were legally bound to report gifts worth more than $35, Werschkul always included an invoice for $34.99.) But every pol told Werschkul the same thing. Give me something in writing, son, something I can study. Give me a breakdown of your case.

So Werschkul spent months writing a breakdown—and in the process suffered a breakdown. What was supposed to be a summary, a brief, had ballooned into an exhaustive history, The Decline and Fall of the Nike Empire, which ran to
hundreds
of pages. It was longer than Proust, longer than Tolstoy, and not a fraction as readable. It even had a title. Without a shred of irony Werschkul called it:
Werschkul on American Selling Price, Volume I.

When you thought about it, when you really thought about it, what really scared you was that
Volume I
.

I sent Strasser back east to rein in Werschkul, check him into a psych ward if necessary. Just calm the kid down, I said. That first night they went to a local pub in Georgetown for a cocktail or three, and at the end of the night Werschkul wasn't any calmer. On the
contrary. He got up on a table and delivered his stump speech to the patrons. He went full Patrick Henry. “Give me Nike or give me death!” The patrons were ready to vote for the latter. Strasser tried to coax Werschkul down off the chair, but Werschkul was just getting warmed up. “Don't you people realize,” he shouted, “that freedom is on trial here?
FREEDOM
! Did you know that Hitler's father was a customs inspector?”

On the plus side, I think Werschkul scared Strasser straight. He seemed like the old Strasser when he returned and told me about Werschkul's mental condition.

We had a good laugh, a healing laugh. Then he handed me a copy of
Werschkul on American Selling Price, Volume I
. Werschkul had even had it bound. In leather.

I looked at the title:
WASP.
How perfect. How Werschkul.

“Are you going to read it?” Strasser said.

“I'll wait for the movie,” I said, plopping it on my desk.

I knew right then that I'd have to start flying back to Washington, D.C., take on this fight myself. There was no other way.

And maybe it would cure my burnout. Maybe the cure for any burnout, I thought, is to just work harder.

1979

H
e occupied a teeny office at the Treasury Department, a space about the size of my mother's linen closet. There was barely room for his government-issued gunmetal-gray desk, let alone the matching chair for infrequent visitors.

He pointed to this chair. Sit, he said.

I sat. I looked around in disbelief. This was the home base of the man who kept sending us those bills for $25 million? I looked now at him, this beady-eyed bureaucrat. What creature did he remind me of ? Not a worm. No, he was bigger than that. Not a snake. He was less simple than that. Then I had it. Johnson's pet octopus. I recalled Stretch dragging the helpless crab back to its lair. Yes, this bureaucrat was a kraken. A micro-kraken. A bureau-­kraken.

Smothering these thoughts, burying all my hostility and fear, I screwed a fake smile onto my face and tried in a friendly tone to explain that this whole thing was a gigantic misunderstanding. Even the bureau-kraken's colleagues within the Treasury Department sided with our position. I handed him a document. “You have right here,” I said, “a memo stating that the American Selling Price does not apply to Nike shoes. The memo comes from Treasury.”

“Hmm,” the bureau-kraken said. He looked it over, pushed it back at me. “That's not binding on Customs.”

Not binding?
I gritted my teeth. “But this whole case,” I said, “is
nothing but the result of a dirty trick played by our competitors. We're being penalized for our success.”

“We don't see it that way.”

“By we . . . who do you mean?”

“The U.S. government.”

I found it hard to believe this . . . man . . . was speaking for the U.S. government, but I didn't say that. “I find it hard to believe that the U.S. government would want to stifle free enterprise,” I said. “That the U.S. government would want to be a party to this kind of deceit and trickery. That the U.S. government, my government, would want to bully a little company in Oregon. Sir, with all respect, I've been all over the world, I've seen corrupt governments in undeveloped countries act this way. I've seen thugs push around businesses, with arrogance, with impunity, and I can't believe my own government would behave in such a fashion.”

The bureau-kraken said nothing. A faint smirk flickered across his thin lips. It struck me all at once that he was grotesquely unhappy, as all functionaries are. When I started to speak again, his unhappiness manifested itself in a restless, manic energy. He jumped up and paced. Back and forth he danced behind his desk. Then he sat down. Then he did it again. It wasn't the pacing of a thinker, but the agitation of a caged animal. Three mincing steps left, three halting limps right.

Sitting again, he cut me off midsentence. He explained that he didn't care what I said, or what I thought, or whether any of this was “fair,” or “American.” (He made air quotes with his bony “fingers.”) He just wanted his money.
His
money?

I wrapped my arms around myself. Ever since the onset of burnout, this old habit was becoming more pronounced. I often looked in 1979 as if I were trying to keep myself from flying apart, trying to keep my contents from spilling out. I wanted to make another point, to rebut something the bureau-kraken had just said, but I didn't trust myself to speak. I feared that my limbs might go flailing, that I might begin screaming. That I might beat the living tar out of
his telephone. We made quite a pair, him with his frantic pacing, me with my frenzied self-hugging.

It became clear that we were at an impasse. I had to do something. So I commenced kissing up. I told the bureau-kraken that I respected his position. He had a job to do. It was a very important job. It must not be easy, enforcing burdensome fees, dealing with complaints all the time. I looked around his office-cell, as if to sympathize. However, I said, if Nike was forced to pay this exorbitant sum of money, the straight truth was, it would put us out of business.

“So?” he said.

“So?” I said.

“Yeah,” he said. “So . . . what? Mr. Knight, it's my responsibility to collect import duties for the U.S. Treasury. For me, that's as far as it goes. Whatever happens . . . happens.”

I hugged myself so tight, I must have looked as if I was wearing an invisible straitjacket.

Then I released myself, stood. Gingerly, I picked up my briefcase. I told the bureau-kraken that I wasn't going to accept his decision, and I wasn't going to give up. If necessary I would visit every congressman and senator and privately plead my case. I suddenly had the greatest sympathy for Werschkul. No wonder he'd come unhinged.
Don't you know that Hitler's father was a customs inspector?

“Do what you gotta do,” the bureau-kraken said. “Good day.”

He turned back to his files. He checked his watch. Getting close to five. Not much time before the workday ended to ruin someone else's life.

I BEGAN, MORE
or less, commuting to Washington. Every month I'd meet with politicians, lobbyists, consultants, bureaucrats, anyone who might help. I immersed myself in that strange political underworld, and read everything I could about customs.

I even skimmed
WASP
, Volume I
.

Nothing was working.

Late in the summer of 1979 Werschkul got me an appointment with one of Oregon's senators, Mark O. Hatfield. Well respected, well connected, Hatfield was chairman of the Senate Appropriations Committee. With one phone call he might be able to get the bureau-­kraken's bosses to clear up that $25 million discrepancy. So I spent days preparing, studying for the meeting, and huddled several times with Woodell and Hayes.

“Hatfield's just got to see it our way,” Hayes said. “He's respected on both sides of the aisle. Saint Mark, some call him. He has no truck with abuse of power. He went toe-to-toe with Nixon on Watergate. And he fought like a tiger to get funding for dams on the Columbia.”

“Sounds like our best shot,” Woodell said.

“Maybe our last shot,” I said.

The night I arrived in Washington, Werschkul and I had dinner and rehearsed. Like two actors running lines, we went through every possible argument Hatfield might throw at us. Werschkul kept referring to
WASP, Volume I.
Sometimes he'd even reference
Volume II
. “Forget that,” I said. “Let's just keep it simple.”

The next morning we walked slowly up the steps of the U.S. Senate Office Building, and I looked up at that magnificent façade, at all the columns and all the shiny marble, and the big flag overhead, and I had to pause. I thought of the Parthenon, the Temple of Nike. I knew that this, too, would be one of the seminal moments of my life. No matter how it turned out, I didn't want to let it pass without embracing it, acknowledging it. So I stared at the columns. I admired the sunlight bouncing off the marble. I stood there for the longest time . . .

“You coming?” Werschkul said.

It was a blazing summer day. My hand, the one gripping my briefcase, was drenched with sweat. My suit was soaked through. I looked as if I'd walked through a rainstorm. How was I going to meet a U.S. senator in this condition? How was I going to shake his hand?

How was I going to think straight?

We entered Hatfield's outer office, and one of his aides led us into a waiting room. A bullpen. I thought of the births of my two sons. I thought of Penny. I thought of my parents. I thought of Bowerman. I thought of Grelle. I thought of Pre. I thought of Kitami. I thought of James the Just.

“The senator will see you now,” the aide said.

She led us into a large, refreshingly cool office. Hatfield came out from behind his desk. He welcomed us collegially, as fellow Oregonians, and led us to a sitting area by his window. We all sat. Hatfield smiled, Werschkul smiled. I mentioned to Hatfield that we were distantly related. My mother, I believed, was his third cousin. We talked a bit about Roseburg.

Then we all cleared our throats and the air conditioner soughed. “Ah, well, Senator,” I said, “the reason we've come to see you today—”

He held up his hand. “I know all about your situation. My staff has read
Werschkul on American Selling Price,
and briefed me on it.
What can I do to help?”

I stopped, stunned. I turned to Werschkul, whose face was the color of his pink bow tie. We'd spent so much time rehearsing this negotiation, preparing to convince Hatfield of the rightness of our cause, we weren't ready for the possibility of . . . success. We leaned into each other. In half whispers we talked about different ways Hatfield might help. Werschkul thought he should write a letter to the president of the United States, or maybe the head of customs. I wanted him to pick up the phone. We couldn't agree. We started to argue. The air conditioner seemed to be laughing at us. Finally, I shushed Werschkul, shushed the air conditioner, turned to Hatfield. “Senator,” I said, “we were not prepared for you to be so obliging today. The truth is, we don't know what we want. We'll have to get back to you.”

I walked out, not looking back to see if Werschkul was coming.

I FLEW HOME
in time to preside over two milestones. In downtown Portland we opened a thirty-five-hundred-square-foot retail palace, which was instantly mobbed. The lines at the cash registers were endless. People were clamoring to try on . . . ­everything. I had to jump in and help. For a moment I was back in my parents' living room, measuring feet, fitting runners with the right shoes. It was a ball, a blast, and a timely reminder of why we were in this.

Then we moved offices again. We needed still more space, and we found it in a forty-six-thousand-square-foot building with all the amenities—steam room, library, gym, and more conference rooms than I could count. Signing the lease, I remembered those nights, driving around with Woodell. I shook my head. But I had no sense of victory. “It can all disappear tomorrow,” I whispered.

We were big, there was no denying it. To make sure we weren't
too big
for our britches, as Mom Hatfield would have said, we moved the way we'd always moved. All three hundred employees came in on the weekend and packed up their belongings into their own cars. We provided pizza and beer, and some of the warehouse guys loaded the heavier stuff into vans, and then we all slowly caravanned down the road.

I told the warehouse guys to leave the baseball-mitt chair behind.

IN THE FALL
of 1979 I flew to Washington for a second meeting with the bureau-kraken. This time he wasn't so feisty. Hatfield had been in touch. As had Oregon's other senator, Bob Packwood, chairman of the Senate Finance Committee, which had review authority on Treasury. “I'm
sick . . .
and
tired
,” said the bureau-kraken, pointing one of his tentacles at me, “of hearing from your high-placed
friends
.”

“Oh, sorry,” I said. “That mustn't be any fun. But you'll be hearing from them until this situation is resolved.”

“Do you realize,” he hissed, “that I don't need this job? Do you know that my wife . . . has . . .
money
! I don't need to work, you know.”

“Good for you. And her.” The sooner you retire, I thought, the better.

But the bureau-kraken would never retire. In years to come, through Republican and Democratic administrations, he'd remain. On and on. Like death and taxes. In fact, one day in the distant future, he'd be among the small coterie of bureaucrats to give the disastrous green light that would send federal agents storming the compound at Waco.

WITH THE BUREAU-KRAKEN
rattled, I was momentarily able to turn my attention back to our other existential threat, production. The same conditions that brought down Japan—fluctuating currency, rising labor costs, government instability—were beginning to coalesce in Taiwan and Korea. The time had come, yet again, to seek new factories, new countries. The time had come to think of China.

The question wasn't how to get into China. One shoe company or another was going to get in, eventually, and then all the others would follow. The question was how to get in first. The first to get in would have a competitive advantage that could last decades, not only in China's production sector, but in its markets, and with its political leaders. What a coup that would be. In our first meetings on the subject of China we'd always say: One billion people. Two. Billion. Feet.

We had one bona fide China expert on our team. Chuck. Besides having worked alongside Henry Kissinger, he sat on the board of the Allen Group, an auto-parts manufacturer with designs on the Chinese market. Its
CEO
was Walter Kissinger, Henry's brother. Chuck told us that Allen, in its exhaustive research into China, had discovered a very impressive China hand named David Chang. Chuck
knew China, and he knew people who knew China, but no one knew China like David Chang.

“Put it this way,” Chuck said. “When Walter Kissinger wanted to get into China, and couldn't, he didn't call Henry. He called Chang.”

I lunged for the phone.

THE CHANG DYNASTY
at Nike didn't start well. For starters, he was preppy. I'd thought Werschkul was preppy, until I met Chang. Blue blazer, gold buttons, heavily starched gingham shirt, regimental necktie—and he wore it all effortlessly. Shamelessly. He was the paisley-­hearted love child of Ralph Lauren and Laura Ashley.

I took him around the office, introduced him to everyone, and he showed a remarkable talent for saying the absolute wrong thing. He met Hayes, who was 330 pounds, and Strasser, who was 320, and Jim Manns, our new CFO, who was a Mounds bar away from 350. Chang made a crack about our “half ton of upper management.”

So much heft, he said,
at an athletic company
?

No one laughed. “Maybe it's your delivery,” I told him, hurrying him along.