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Final Work Report 489

Nokia rose rapidly in the 1990s to become the top mobile phone brand, but then declined sharply after 2007. Strategic issues behind Nokia's failure include having inferior technology to the iPhone, a lack of vision and planning for changes, slow adoption of trends like touchscreens and apps, and failure to match competitors' integration of software and hardware. By 2013, Nokia's market value had declined 90% and it sold its hardware business to Microsoft.

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Fariha Farjana
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50 views

Final Work Report 489

Nokia rose rapidly in the 1990s to become the top mobile phone brand, but then declined sharply after 2007. Strategic issues behind Nokia's failure include having inferior technology to the iPhone, a lack of vision and planning for changes, slow adoption of trends like touchscreens and apps, and failure to match competitors' integration of software and hardware. By 2013, Nokia's market value had declined 90% and it sold its hardware business to Microsoft.

Uploaded by

Fariha Farjana
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Strategic issues

It is important to focus on the strategic issues but Nokia has failed to do so. Strategic issues
behind the failure of Nokia Company¬

Nokia emerged from Finland to lead the mobile phone revolution, In less than a decade. The
company grew rapidly and became one of the most recognizable and valuable brands all over
the world. With the young, energetic and united leadership team at the organization, the
company achieved great success. The firm's innovative technologies like Digitization and
deregulation of the telecom network spread rapidly all over the world. With the Disciplined
system and process were put in place which made Nokia become efficient and greater
improvement in the production and sales as compared to the competitor. Between 1996-2000
the headcount at Nokia Mobile Phones improved from 150 percent to 27,353 while the
revenue over the period were up 503 percent. In 1996 It launched the global first smartphone.
Nokia became the best-selling mobile phone brand in the world in October 1998 and the
company's operating profit went from $1 billion in 1995 to almost around $4 billion by 1999. In
2001 Nokia's first camera phone and was the second generation smartphone launched. The
best-selling mobile phone of all the time Nokia 1100 was launched in 2003. In 2007, Apple
introduced the iPhone. After the great 90s, in this year Nokia started to go downhill, In the year
2009, Nokia posted its first quarterly loss in more than a decade. This is mainly due to the
Launch of smartphones running on the Google Android operating system by HTC and also with
the iPhone and various Android smartphones taking the market by storm. Nokia failed to keep
the market up. In 2010 Nokia launched the "iPhone killer" But it failed to match with the rivals.
The quality of Nokia's high end phones continues to fall down. In just 6 years, the market value
of Nokia declined by about 90%. Instead of joining the Android adopter, Nokia's CEO Stephen
Elop decided to join hands with Microsoft to develop the smartphones running on the Windows
Phone platform. With this partnership, Nokia developed the Lumia series of smartphones, But
still, the firm was not able to regain its glory days. On September 3, 2013, Nokia announced
that its hardware department will be acquired by Microsoft Corporation in a deal worth $7.2
Billion.
Strategic issues behind the failure of Nokia Company are:

 Nokia’s technology was inferior to Apple’s


 lack of vision
 Lack of management
 Late adoption towards the market change
 Lack of planning for future crises
 Adoption of marketing strategies that were not effective
 Slow adoption of market trends
 The arrogance among top-level managers
 Apple redefined smartphones with touch screens and blackberry with email and Android
development proved that software is more important than the hardware- Nokia was
really good at transforming phones into highly fashionable accessories, but they failed
due to lack of concentration on software.
 lack of value of proposition: The iPhone was integrated really well with other Apple
devices & Samsung's Android smartphones were seen as a highly versatile and user-
friendly device. These features added more value to their product. But Nokia's Phone
didn’t really have any of an equivalent zeal as their competitors. even if their phone did
something better than iPhone and Android, but still lacked the value of the proposition,
they were unable to highlight this in their promotion strategies. Nokia Lumia is one of
the examples of this. This is an almost complete failure version of Nokia, Even though it
is a good phone based on manufacturing standards it did not add any value.
 The local brand phones stole the lead on Dual SIM, Low-end Qwerty, and long battery
life span, But Nokia was slow to respond to these changes in trends.

Bibliography
(n.d.). Retrieved from https://wall-street.com/top-4-mistakes-nokia-made/

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