Strategic Analysis

By: Henry Ford

Nokia Corporation is a multinational company that engages in manufacture and selling of mobile phone devices as well as mobile network equipments and provision of associated solutions in the whole world. The company has four different business segments: Multimedia, mobile phones, networks, and enterprise solutions. The mobile phone segment provides mobile data devices and voice. The company has about 132,000 employees working in the whole world. It is the largest mobile phone producer in the whole world with its headquarters in Finland and it operates in more than 150 countries in the whole world. By the year 2010, Nokia Company was in the lead in terms of market share with about 28.9% in the whole world (Henry 2008: 12). The company has a history of about 146 years and it has experienced a lot of changes from the way it was and what it is currently. Through strategic management, Nokia Company has been able to get a larger market share in the whole world and earn more profits and revenues as compared to other mobile phone manufacturing companies.

Nokia Vision and Mission
The vision of this company is very simple, ‘connecting people’. This means that it aims at ensuring that all people in the whole world are connected by providing them with communication and internet devices which would facilitate connection (Capon 2008: 34). Through communication over the phone or through the internet, people are in a position to come together and get connected. On the other hand the company’s mission is ‘build great mobile products our job is to enable billions of people everywhere to get connected’ (Lindholm et al. 2003: 38).
Goal and objectives
The following are Nokia’s goals and objectives in the market:
i) To create and build high quality mobile products
ii) To assist people in feeling that they are very near to what matters to them most
iii) To facilitate people from all over the world get more life’s opportunities through mobile phones connections
iv) To provide internet to many people in the whole world with the improving internet technology.
Internal Analysis
SWOT Analysis of Nokia Company
Nokia Corporation has been able to proceed because of its strengths and opportunities. However, it is faced with some weaknesses and threats that are viewed as hindering the forward movement of this company.
a) Strengths
i) The company has the worlds leading and largest network of distribution and selling when compared to its competitors like Samsung and Motorola companies
ii) It has high qualified and innovative employees who are capable of bringing new ideas to the company and as a result helping in providing high quality products to satisfy their customers (Thompson & Thompson 2010: 4).
iii) Nokia Company receives a lot of money as profits and revenues from its branches all over the world and hence its financial base is very strong. This has made it very profitable as it is in a position to venture into the international markets by investing in foreign countries (Hitt et al. 2010: 32).
iv) Its products are highly demanded as they have accessories which one could want. Provision of high quality products have resulted in the company becoming the world leading mobile phone seller (Dobson et al. 2004: 23).
v) Nokia has been able to expand it markets by providing wide range of products. In this case, the company is divided into four dynamic segments Multimedia, mobile phones, networks, and enterprise solutions. This shows that it is in a position to provide its customers with diversified products (Helfat 2007: 39).
vi) The re-sell value of mobile phones manufactured by Nokia Company is high as compared to that of other companies.
vii) It has increased resources in terms of technical and human resources and therefore provision of high quality products and services is facilitated (Ketchen & Berth 2005: 65).
b) Weaknesses
i) Some of the phones that are produced by this company are not user friendly or are very difficult to learn. Despite that Nokia Company is well know for its provision of user friendly products, some of its phones are very hard to learn how to use them especially for those people who are not much literate (Warren 2008: 45).
ii) Because of the improved quality of products offered, the company’s products are of high quality hence hindering some average earners to purchase. Nokia’s products are somehow considered of a class and therefore they are sold at increased prices.
iii) The company has not established adequate numbers of services centers in the third world countries like African and some parts of Asia (Daft & Marcic 2010: 160). This has resulted to its services being competed against heavily in these countries.
iv) The company has not targeted lower class of society when marketing its products and hence its products are not increasingly purchased by this group of people (Harrison 1999: 33).
c) Opportunities
i) The Nokia Company have the opportunities of improving its in the United States of America by opening as many stores in the country as possible.
ii) The company can integrate internet services with mobile phone in order to improve and add value to their products (McCall & Kaplan 1990: 23). In this case, people would be more willing to purchase Nokia phones which have internet services in order to be able to surf the internet as they are moving from one place to the other
iii) There are opportunities of forcing low logistics costs in order to decrease prices in the markets as a way of attracting many customers and increase profit margin (Williams 2002: 12).
iv) The company is on the move of manufacturing computers as a way of diversifying the markets in order to gain increased profits.
v) Nokia can form partnership with companies like Google Inc. or Microsoft Corporation in order to effectively market its products in the whole world through the internet (Johnson & Gustafsson 2000: 12)
d) Threats
i) According to Easton (2006: 6), Nokia Corporation is facing increased threat from its competitors like Samsung and Motorola which are increasingly investing in market diversifications.
ii) There are new mobile operating systems that are introduced by internet services providing companies like Google and Microsoft hence challenging the services offered by Nokia.
iii) Adoption of new technology and putting it to great use is the biggest threat facing this company. According to Hill and Jones (2007: 440), the modern internet technology is changing every the other minute and this may pose a threat to mobile phone producing companies like Nokia.

The Boston Matrix on Nokia Company
This is a technique that was developed by Bruce Henderson and is used in assessing the long term profitability of market sectors and products.
i) Problem child: This shows that when a new product is launched in the market it usually has low market share but get potential to the star, then cash cow and in case there is a failure, it can become a dog. Nokia’s N- series Smartphone N96 is facing a lot of problems in getting market share like N95 (Pearce & Robinson 2005: 27).
ii) Cash Cow: This is when a product’s market matures but has slow demand and large market share; it is usually referred to as cash cow. A good example of a cash cow of Nokia is N95.
iii) Star: When a new product is launched it has high market share and increased sales. Nokia is looking for products which could be turned to starts and it is investing a lot of money in order to turn problem child and dogs into start.

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