Nokia Case Study Analysis The Rocking Horse Winner Essay
They had to meet the various and growing demands of increasingly numerous and disparate product development programmes without sufficient software architecture development and software project management skills.
This conflictual way of working slowed decision-making and seriously dented morale, while the wear and tear of extraordinary growth combined with an abrasive CEO personality also began to take their toll. Beyond 2004, top management was no longer sufficiently technologically savvy or strategically integrative to set priorities and resolve conflicts arising in the new matrix.
Increased cost reduction pressures rendered Nokia’s strategy of product differentiation through market segmentation ineffective and resulted in a proliferation of poorer quality products.
While Symbian had given Nokia an early advantage, it was a device-centric system in what was becoming a platform- and application-centric world.Not only did Nokia’s strategic options seem limited, but none were particularly attractive.In the mobile phone market, Nokia had become a sitting duck to growing competitive forces and accelerating market changes.A renewed effort to find the third leg was launched with the Nokia Ventures Organisation (NVO) under the leadership of one of Nokia’s top management team.This visionary programme absorbed all existing ventures and sought out new technologies.At the same time, the importance of application ecosystems was becoming apparent, but as dominant industry leader Nokia lacked the skills, and inclination to engage with this new way of working.By 2010, the limitations of Symbian had become painfully obvious and it was clear Nokia had missed the shift toward apps pioneered by Apple.The search for an elusive third leg Nokia’s leaders were aware of the importance of finding what they called a “third leg” – a new growth area to complement the hugely successful mobile phone and network businesses.Their efforts began in 1995 with the New Venture Board but this failed to gain traction as the core businesses ran their own venturing activities and executives were too absorbed with managing growth in existing areas to focus on finding new growth.But as I argue in my latest book, “Ringtone: Exploring the Rise and Fall of Nokia in Mobile Phones”, this ignores one very important fact: Nokia had begun to collapse from within well before any of these companies entered the mobile communications market.In these times of technological advancement, rapid market change and growing complexity, analysing the story of Nokia provides salutary lessons for any company wanting to either forge or maintain a leading position in their industry.