MBA Project: Strategic Management Analysis of Nokia's Decisions

This project provides a comprehensive strategic management analysis of the Nokia company, examining its journey from a leading mobile phone manufacturer to its eventual decline. The report delves into Nokia's business strategies, including its vision, branding, and pricing strategies, highlighting key decisions and their impact. It identifies current strategic and operational issues, such as the rise of competitors like Apple and the company's inability to adapt to the changing smartphone market. The analysis utilizes conceptual, external, and internal factors, including Porter's Five Forces, to understand the challenges faced. The project also explores internal factors like adaptability and adaptability to the market, and recommends alternative strategies and first priority actions for the company to regain its position in the market. The project concludes by emphasizing the importance of adapting to change and the need for innovation in the face of market disruptions. The report is based on the MBA project guidelines from Skyline University College, Sharjah, UAE for the Strategic Management course (MGM 7102), aiming to provide recommendations to improve the organization's work.

STRATEGIC MANAGEMENT
The rise and decline of Nokia company

Introduction
◦Every organization must renew their business
strategies at regular intervals in order to increase sales
and achieve customer satisfaction.
◦The present report will take the Nokia company to
highlight the strategic and operational challenges they
have been facing through the past years and how they
have made suitable decisions and changes in order to
cope up with the challenges.
◦The report will also focus on the innovative changes of
the organization and provide recommendations for
better results

Nokia company
◦In the year 1865, the company had begun
holding the hands of Frederick Idestam and
Leo Mechelin.
◦According to a latest survey in the year
2017, the company has employed almost
102,000 people from more than 100
countries all over the world
◦The Nokia company is a significant
contributor to the development of the GSM,
3G, LTE and recently in the 5G standards.
◦In the year 2014, the company bought by
the Microsoft company

Nokia business strategy
◦ The Nokia company has gone
through significant positive
changes in the decade 1990s.
◦ The information system has
enabled the decision making
process easier in all the
functional departments.
◦ The previous logo of the company
consisted of the “three arrows”
that was created in the year
1966.
◦ After few years, the main
organizational slogan of the
company was devised that is
“connecting people “by Ove’
Strandberg.

Nokia business strategy
◦ The vision statement of the company
is “our promise is to help people feel
close to what is important for them”.
◦ The trust they have built with their
customers has proved to be their
strongest weapon.
◦ The Nokia company uses the two
types of branding strategies for their
products because the company’s
target market consists of two kinds:
the upscale buyers and the economy
seekers.

Nokia business strategy
◦ The company has its own pricing
strategy.
◦ The company applies the
skimming marketing strategy and
then it decreases the price off that
product after some times.
◦ . There are various promotional
campaigns conducted by the
company at regular intervals.
◦ Hence, the Nokia company has
their own e-business strategy
which is designed to add extra
value to the marketing strategy.

Current strategic / operational
issues in Nokia
◦ During the rise of iPhone, the coordination between the top managers of
the company got frozen.
◦ The downfall of the Nokia company can be ascribed to three factors by
some executives.
◦ First of all, the Nokia company was less in superiority than Apple.
Secondly, the company was more complacent. Thirdly, the coming
disruption of iPhone was not perceived by the leaders of the company.
◦ Nokia company lost the battle of smartphones because the fear among
the top and middle managers in the company spread a kind of inertia.
◦ Nokia company lost the battle of smartphones because the fear among
the top and middle managers in the company spread a kind of inertia.

Cont…
◦ In the year 2007, the N95
smartphones were launched by
the company having declined the
quality of the high-end phones.
◦ in the year 2008, the Nokia
company launched Nokia 5800,
the first touchscreen phone at
comparably lower prices
◦ In 2009, the N97 phone was
launched by the company to give
tough competition to the iPhone.

Cont…
◦ The conspiracy theory suggests that the CEO of the
company Stephen Elop himself came from the Microsoft
company and thereby taking all the decisions those were
in favor of the Microsoft company
◦ The conspiracy theory suggests that the CEO of the
company Stephen Elop himself came from the Microsoft
company and thereby taking all the decisions those were
in favor of the Microsoft company

Conceptual factors related to the issue (mission,
vision values)
◦ The Nokia company also wanted
to become what Apple and
Google are today.
◦ The IPhone company is now
soaring with a success by
gathering the plaudits is nothing
but a fulfillment of the vision
Nokia had visualized almost 20
years back but could not fulfill it.
◦ the Nokia N8 phone was perfect
from every aspect, but the
software that was chosen for this
phone was wrong or unsuitable.

The external /environmental factors related to
the issue
◦ The external factors that are related
to the issue can be measured using
the Porter’s five Forces.
◦ The threat of new entrants has
obviously increased.
◦ The decline in the popularity has
caused the company to bear the
bargaining power of the buyers and
the suppliers.
◦ Hence, it can be seen that the failure
of the Nokia company to compete
with the smartphones has caused
the company a huge loss both in the
operational and marketing aspect.

Internal factors (structure, processes, and
people) relevant to these issues
◦ The decline in the Nokia
performance has caused the
caused the internal factors of the
company also get affected up to
greater extent.
◦ Today’s scenario is thus, the
company now occupies only three
per cent of the market share of
the international smartphone
market.
◦ The first cause behind the decline
of the Nokia Company has been
considered to be its lack of
adaptability to the changing
phenomenon of smartphone
trend.

Recommended alternative
strategies ◦ the key is to adapt to change.
◦ The leader’s/ organization’s
effectiveness is limited without
adapting a change
◦ . It is recommended that the
amalgamation of speed and
technology is needed to face the
complexity of a transforming
environment.
◦ The motivation must be
redefined.

First priority actions
◦ It is the rule of business, it the
organization itself does not
cannibalizes itself, some other
company will do it.
◦ Next step is, they must have
pruned and added innovation
keeping in mind the red tape and
bureaucracy which choked the
innovative spirit from inside
◦ The need for change must have
been communicated with the
employees and the members of
the organization who were the
foundation of Nokia.

Conclusion
Therefore, from the above discussion, it can be said that
the Nokia company had all the necessary abilities and
qualities to become world’s one of the top mobile
companies. However, the major reason behind their
failure to deal with the smartphone phenomenon and
almost every attempt they committed proved to be
failures. The report also further mentions some
recommendation for the company following which the
company could have avoided such failure.

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