In his book Ringtone: Exploring the Rise and Fall of Nokia in Mobile Phones, Yves Doz, emeritus professor of Strategic Management at the INSEAD business school, claims that the demise of Nokia had its roots well before Apple, Google and Samsung started competing with it.
The company embraced new ideas and experimentation but subsequently became less innovative and poorly reorganised.
Promising era
The company was visionary and courageous, taking advantage of its innovative technologies. With digitisation and deregulation of telecom networks emerging across Europe, the situation of Nokia was good. When needed, the company managed to introduce new systems and processes and remained very efficient.
The company introduced the world’s first smartphone in 1996 and launched some other innovative products too. Until 2000, revenues and staff increased substantially. However, that rapid growth put managers of the main development centres under pressure.
Long-term visions were relatively successful
Company leaders wanted to complement the successful mobile phone and network businesses with an additional business unit. After some time, a top management team launched an initiative which comprised all existing ventures of Nokia and focused on the development of new technologies.
Many significant projects, later transferred to the core businesses, emerged thanks to this initiative. Furthermore, even the potential of the internet of things was identified correctly but back then it was still too early.
However, even a market leader may get into the slow lane. The second part of the article will describe how it happened in this case.
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Book: Doz, Y.: Ringtone: Exploring the Rise and Fall of Nokia in Mobile Phones (OUP Oxford 2017, 208 pages)