I) Introduction………………………………………………………… 1

II) History………………………………………………………………. 1

a) Nokia’s First Century………………………………………….. 1

b) The Move to mobile……………………………………………. 2

c) Mobile Revolution……………………………………………... 2

d) Nokia Now……………………………………………………… 3

III) Mission Statement…………………………………………….. 3

IV) Vision Statement……………………………………………… 4

V) PEST Framework……………………………………………….. 5

VI) SWOT Analysis………………………………………………. 9

VII) Performance Objectives……………………………………... 11

VIII) Nokia 4 V’s…………………………………………………… 12

IX) Nokia Supply Chain…………………………………………. 13

X) Process Mapping………………………………………………... 15

XI) Conclusion……………………………………………………. 16

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Introduction

The aim of this assignment is to introduce and analyze the basic features of a well-known

Nokia Corporation, which mainly deals with mobile and network communication systems.

To begin with, the company’s historical background will be presented followed by the

examination of certain details about the company, including its mission, business strategy, and

its goals. Also, the PEST framework of the company and its SWOT will be examined and

analyzed. Their Performance objectives (Speed, Flexibility, Quality, Dependability and Cost)

will be mentioned and their overall process of the company explained.

History:

Nokia has been in the business field for more than a century. They have created many

products, services and have established their very own life style. To show its performance and

success in a simple way, its history can be divided into four main Parts:

Nokia’s first century

The move to mobile

Mobile revolution

Nokia now

Nokia’s first century:

The company was founded in 1865 by Frederick Idestam. The company began a paper

mill in Tammerkoski in southern Finland. Frederick Idestam then built another mill by the

Nokiavirta River where he gave the name Nokia to the mill in 1871. Originally, the

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Nokianvirta River was named after a dark furry animal, locally known as the Nokia – a type

of marten.

Following a major industrial force, the company merges with a cable company (founded

by Eduard Polon) and a rubber firm (founded by Arvid Wickstrom) which sets Nokia on the

new path of electronics. Nokia’s first electronic device was a pulse analyzer designed for use

in nuclear power plants in 1962. Their interest in telecommunication systems began in 1963

when they started developing radio telephones for the army and the emergency services, prior

to the manufacturing of televisions, radio phones, data transfer equipment, radio link,

analyzers and digital telephone exchange.

Nokia will change its production and focus on the telecommunication expertise until it

becomes the core of its future work.

To move to mobile:

In 1979 Mobira Oy was the first phone maker. They begin life as a joint venture between

Nokia and leading Finnish television Salora.

The Mobile phone revolution started in 1981 with the launch of the first Nordic Mobile

Telephone (NMT) service. The phone industry began to expand rapidly and Nokia introduces

its first car phones followed by the portable in 1986.

Mobile revolution:

In 1992, Nokia decides to focus on its telecommunications business. This happens when

Jorma Ollila becomes CEO of Nokia and he chooses to concentrate on telecommunication

industry. In the 1990’s, the rubber, cable, and consumer electronics divisions, were therefore

sold. Nokia’s only business turned towards the manufacturing of mobile phones and

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telecommunications systems. The strategy of Jorma Ollila was to create a new era of

telecommunication on a long term vision.

In 1992, the company launched its first GSM handset and then introduced their famous

Nokia Tune in 1994. During that year, the world’s first satellite was made using a Nokia GSM

handset.

In 1997 the world famous mobile game “Snake” was presented in the Nokia 6110. Soon

after, in 1998, the company became the world leader in mobile phones. Following a good

deal of research, they launched the first mobile phone “Nokia 7110” which included a WAP.

Nokia Now:

Presently, Nokia is creating more and more mobiles phones with differing functions. The

company also makes sure into diversifying and segmenting its products.

Their leading position pushed the company to go forward in their research. They came up

with the first 3G Phone in 2002, and the multi-player Nokia N-Gage. In 2005, the N-series

were born with their sophisticated mobile phones.

In 2006, Olli-Pekka Kallasvuo became the new CEO of Nokia and Jorma Ollila shifted to

being the Chairman of Nokia’s board. At that time Nokia and Siemens announced plans for

Nokia siemens network the leading operations of Nokia. In 2007, Nokia launched its new

internet services brand.

In order to achieve its goals, Nokia developed strategies. These strategies differ from

country to another, from a culture to another. Companies are always creating a vision and a

mission statement to make everything tacit. Evidently, Nokia has set up its specific missions

and visions.

Mission Statement:

1-To guide and focus decision making

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2-To create a balance between the competing interest of various stakeholders

3-To motivate and inspire organizational members

However, it is important to point out that mission statements do not always deliver the

promised benefits. In reality, mission statements are often unreadable and uninspiring, and

articulate values that are unrealistic or are not aligned with day-to-day organizational

behaviour.

Previous mission statement research focused primarily on the content of mission

statements and/or on the manager’s perception of the mission statement. Meanwhile, the

mission statement perception of individual organizational members received little attention.

Vision Statement:

Nokia wants to create a new world; to transform a big planet to a small village. Their

vision is to create, build, and encourage people from all countries to communicate with each

other in order to create a world where everybody is connected.

Humans learn from people around them, but men also seem to forget that beliefs and

thoughts differ from person to person. The way of thinking, experiences, believes are

simultaneously related in a logic approach. Similarly, Nokia wants to create a world of

creativity and experience, shared experiences.

Their promise:

Getting the trust of the customer is not easy. Nokia tends to help people feel close to what

matters to them. What makes a discussion interesting is exchange and communication; Nokia

gives their customers this possibility. It takes a Human approach to technology: Simple,

Reliable and Intuitive.

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PEST framework:

Nokia can be classified as an international organization. Big companies focus Macro-

environment factors that comprise Political, Economics, Social and Technology. Nokia should

be aware of the opportunities and changes occurred in the external environment because of

the diversification of culture and the different external factors between different countries. It

has to adjust its strategic plan in order to develop international Market. PEST is a tool that

helps analyze the overall business context covered of an organization:

1. Political

2. Economic

3. Social

4. Technology

Political:

The political includes all that is in relation to the government and policies. The company

acquires resources from government such as the economical, scientific and technological

policies. The success of Nokia has obtained the resources from the Finnish policies which

assist Nokia to advance its products.

The Finnish policies are the most important factors contributing to Nokia. To operate

efficiently, a modern knowledge and technology based on the economy that is highly

specialized; internationalized and undergoing rapid structural change requires active support

from the public sector. In its widest sense, industrial policies, science and technology policy

comprise all those measures by which the public sector shapes the operating environment for

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business and this faster are public welfare. These both policies for the Finnish government

and parliament are crucial for the development both of the Finnish economy and of the

National information society. Finnish government best facilitate the efficient functioning of

the economy by directing resources to the reduction of market failures. The state must also

pursue an industrial and economic policy that provides a stable macro-economic environment

for enterprises, general macro-economic stability, low interest rates, stable currency

conditions, and international competitiveness of the taw system and also the political stability

of the country. The positive political factors are helping Nokia to build a name in the

telecommunication world.

Economic:

During the past few years, Nokia has grown rapidly and had a positive impact on the

Finnish economy. In addition to its growth, Nokia has also impacted the development of

hundreds of its partners and subcontractors.

Nokia has gone through different metamorphoses. The history of the company is full of

divestments, acquisitions and joint ventures. These experiences have led the company into

acquiring and building a good image in the society and started to strengthen its operations by

acquiring several electronic companies such as Luxor, Salora and Standard Elektrik Lorenz’s

consumer electronic industry. These acquisitions gave the opportunity to the company to grow

and to create more and more employment in business units inside and outside Finland. Nokia

started creating subsidiaries in Europe and then all around the world.

In the 1990’s, Nokia’s faced a crisis. At that time they had invested into many businesses

when the Finnish economy went into recession. Due to heavy losses and the decrease of some

business lines, Nokia decided to sell a number of business groups. Nokia worked hard to

come out from this economical problem and succeeded into increasing its extension.

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Nowadays, Nokia is as much as high as the Finnish budget. In 2000, it has accounted for

3.3 per cent of the Finnish GDP and 24 per cent of total value of Finnish export. Nokia also

invested heavily in R&D and conducted a large share of its research in Finland. Its large

investment in R&D pushed them to hire more employees hence reducing unemployment in

Finland. Nokia counts more 24 500 employees only in Finland which implies that Nokia

account 1.1 per cent of total employment in Finland.

Social:

The relationship between Nokia and the rest of the world is very strong. The company

accepts the responsibility of their worldwide position. One aspect of their corporate

responsibility is to be connected with the communities they affect in order to channel that

impact into a positive societal contribution.

Nokia is committed to supporting various communities’ trough donations, sponsored

programs and partnerships. Nokia has accordingly chosen to support organizations and

projects which reflects its values. Many of their programs contain young people such as “Le

boulevard des jeunes musicians “ in Morocco. Supporting such programs also has a wider

social impact as they directly benefit teachers, parents and other members of the community.

The use of mobile technology help bridge the communication gaps between various

communities around the world. The village phone and “Bridgeit” are good examples.

Technology:

Nokia is investing heavily in R&D to come up with last technologies. They want to offer

the best to their customers and show that they will always come up with sophisticated items

by creating different types of products every year.

Nokia, as a big company, doesn’t operate randomly. In order to be successful they set up

some priorities such:

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1. Embrace the internet:

i. Doing everything on the mobile that we can do on the PC. Using a cell

phone that can replace the laptop is revolutionary. Offer for a truly

mobile internet and unique Nokia internet experiences.

2. Excel with software platforms and applications:

i. Nokia has created many types of cell phones in different series. They

launched 44 devices in September 2006 and excel with 51% of their

market share among converged devices in July 2006 and they have also

shipped more than 70 million S60 devices. Finally, Smart phone market

expected to exceed 205 M in 2008.

ii. Nokia is actively using open source components technologies and

applications.

3. Win developers with consistent architectures:

i. The support and business opportunities are given through tools,

documentation and online support, access to prototype and experts,

training, technical support and consultancy, application testing, market

programs and co-marketing.

4. Read multi-radio productization and evolution:

i. It’s all the internal component of a cell phone such as the memory and

the SIM card.

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SWOT Analysis:

Strengths: Nokia is a dominant player in the Smart phone market via its majority of

proprietary series. It has dominated the world of mobile phones and has created its own

culture and philosophy.

Weaknesses: Nokia produced a phone that gave her for a moment a bad image which is

the N-Gage. They didn’t adopt new ways of thinking. Customers prefer the Clamshell phones

and Nokia was reluctant to produce a clamshell until now, when it launched the first model.

Opportunities: Nokia has the opportunity to increase their presence in the CDMA market

(Code Division Multiple Access), which they are just entering as well as 3G. There is a

possibility to grow in new countries such as India and other small countries.

Threats: Nokia was among the latest mobile phone companies who created the 3G, so

there is a risk to be displaced by competitors such as Motorola, LG etc…

In a world where every one can be connected, we take a very human approach to

technology. Nokia starts its introduction to the global market by that statement as a vision to

create a linkage between people and to get them always connected with each other. Nokia is

world’s largest and leading manufacturer of mobile telephones and network equipments,

which owns an approximately 36% of the global market share. The competition and the

fighting for the top spot in cell phones supplier are the goals where of the value proposition

are set. Nokia believed that its business processes, strategies, structure, organization,

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management, and culture and environment drivers are leading to one of the best information

systems.

Nokia has many competitors such as LG, Samsung, Motorola, and Sony- Ericson and so

on. The graph below shows the competition between Nokia and some other operators in

entertainment features.

According to the graph, LG and Samsung are the top leaders in the entertainment features.

It is noticeable that there is a total absence of a play lives TV for Nokia, which does not

necessarily mean that the company is doing bad. Nokia is still the leader of mobile phones in

the market, why, because they know what the consumers are looking for and what kind of

consumer they are targeting. LG and Samsung mobile phones are not divided into categories;

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they are producing mobile phones with everything in it whereas Nokia meets the needs of

each customer.

Performance objectives:

Nokia is respecting all the important criteria that lead to its success. To make things more

tacit, its performance objectives are listed: Quality, Speed, Dependability, Flexibility and

Cost.

Quality: Nokia phones are solid. The quality of sound and the button make you

feel ill at ease with the phone. Its materials and components are one of the

most important factors that push the customers to buy it, the design too.

Speed: A Nokia phone response and transfer quickly items for a phone to

another. Also the short cut, easy, evident and simple to use.

Dependability: Nokia phone will never let you down because of the high

autonomy of the battery. In some phones, especially professional ones, they

offer an extra battery to be always available.

Flexibility: They produce cell phone suitable to every kind of person. They

have a wide range of style, from the basic use to the professional one.

Depending on the status, the software’s are not the same. The features of

phones for young people are not the same as the professional one as they differ

in the complexity of their systems.

Cost: They produce a wide variety of products ranging from cheap to very

expensive. Most of the people can buy a Nokia starting from 300 Dh, for e.g.

Nokia 3310, to the expensive one like the Nokia Sapphire that cost around

14 000 Dh.

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Nokia’s 4 V’s:

Volume: Nokia has a medium to high volume because its produces a large quantity of cell

phones but not everyday. People buy a cell phone once generally for a year or two.

Variety: Nokia produces only cell phone and other software. The variety of the company

is very low

Variation: The variation in demand is very high. Nokia attempts to meet the requirements

of their customers both professional and ordinary ones.

High Volume Low

Low Variety High High

Low Variation High

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Low Visibility High HigHigh

Volume: Nokia is located over 40 countries all over the world including shops. We can

see the brand name everywhere and it’s much known.

The company has a mass and cell production process. It’s a mass because it produces a

large quantity of cell phones and it’s a cell production because each cell phone is produced in

a plant in China, Finland and Brazil. The manufacturing of each phone is done separately

Nokia Supply chain:

For Nokia, the reality of a supply chain management is a fact; and the commercial

organisation chosen and the levels of service displayed are proving it.

Nokia doesn’t sale its cell phones directly to individuals, they sale them through

operators such (Bouygues, SFR, Maroc Telecom) and to distributors (Cora, Auchan,

Carrefour…) also to traders who are intermediate who are responsible for the marketing of

Nokia products with the small distributors.

The supply chain management of Nokia is very strategic because of the market

expansion. It’s a market who grows slowly, so they should optimize resources and the

capacity of production. Another point that shows the importance of supply chain manager

holds that the competition is exacerbated. One of the operators have manufactured in the

Scandinavian countries, so Nokia has to take decisions to optimize the supply chain to counter

their offer.

As a big MNC, it should be much organised. In the beginning it plans forecast. Nokia

looks to the market three years. Then, they make a forecast in their sales over 12 months.

Every subsidiary develops previsions of their market. In their prevision of sale, things aren’t

simple. It does not only make a historical observation and then have a prevision, no; it must

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be taken into account the rate of penetration in the country and its level of growth in the

future. It looks the part of the market that needs improvement.

These 12 months forecast and the daily schedule in the very short term allows two

things. It allows Nokia to know it needs for the next weeks and for the next months, per

country, per family products. Then Nokia will optimize the capacity of production which is

then distributed. Each country will be given a part of production.

Nokia is organised in the base of two teams. There is one team of prevision and sales

planning (logistics team), working against a team to optimize the daily production capacity

and supply (supply team).

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Process Mapping:

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Nokia Head quarters

R&D Department

Making a Prototype

Decision

Purchase department

Buying materials

Storage

Quality check

AssemblyIn china

Making Final product

Test & Measurement

Marketing Department

Sales Department

Supplying distributors all over the world

Nokia Stores & other

distributors

Conclusion:

It is most probably due to Nokia's innovation and continual progress that the company

was able to attain such a high stand in the market. Another major factor that allowed Nokia to

be so successful was the demands of the customers. Evidently, the customers were continually

searching for faster, better, smaller operators, and it is because of these demands that Nokia

was able to reach its level.

Finally, it would be very interesting to also deeply investigate another major company,

such as Sony-Ericsson, and determine the factors that differed and advantaged Nokia over the

other company.

References:

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www.Wikipedia.com

External Ressources: Flyers, Books

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