WHY DID NOKIA FAIL? FULL CASE STUDY WITH LEARNINGS FROM THEM
The rise
and fall of the world's largest telephone operator: NOKIA
Back before phones got apps, touch screens, or cameras, one type of Finnish led to the evolution of mobile phones.
Famous for its
non-booking design and long-lasting battery, Nokia quickly seized the market
share by advertising mobile phones as fashion accessories. Like watch straps,
users can change the colors of the cover, turning the cell phone into a fashion
statement.
In 1998, Nokia
surpassed Motorola to become the world's largest mobile phone brand.
At its peak in
2007, Nokia owned 51% of the global market share for mobile phones. To put that
in perspective, Apple now owns about 25% of the global market share.
From high-level
global governance to imminent relief, Nokia's telecommunications business
reached its peak with a $ 7.2 billion sale to Microsoft in 2013.
"We did
nothing wrong, but somehow we lost" - Stephen Elop, former Nokia chief
executive officer
Nokia bugs
The decline in
productivity is due to many factors - manageable and uncontrollable. Either
way, they are definitely wasting something.
Here are four
key mistakes that led to the decline of the company:
1. Focus on
Hardware Only
Building a
portable device such as a cell phone is undoubtedly a daunting task. However,
without good software, it would not stick.
By the time
they realized, Android and Apple had the first advantage of uninstalling
software-based software (iOS and Android) that is now widespread in the mobile
industry.
Nokia's
operating system was called Symbian. While iOS and Android were based on the
app, Symbian was device-based. Basically, they were looking in the wrong
direction. In 2009, Nokia used 57 different and incompatible versions of its
operating system - the company's worst nightmare.
There must be a
reason why there is so much confusion about software developers, but you never
hear of “computer engineers.”
PIC :Nokia 5190/6190.
IMG SRC: sim-unlock.net
2. Hesitation
to Switch Operating Systems
Photo by
Microsoft CEO Steve Ballmer and Nokia CEO Stephen Elop
Microsoft CEO
Steve Ballmer and Nokia CEO Stephen Elop. Photo by BI.
As Google
entered the market in 2008, many of its competitors are jumping on the Android
operating system. Among them were the sellers of Samsung, Motorola, and Huawei.
While competitors were enjoying a growing market share, Nokia was reluctant to
change operating systems.
In 2011, Nokia
finally took a stand. Except that they haven't changed on Android. They are
partnering with Microsoft to use Windows Phone as a leading Nokia platform.
The move proved
to be a disaster for the company, as Nokia successfully handed over its market
position in 2013. To put this error in context, Android now dominates the OS
market with more than 80% of smartphone apps, while Windows Phone currently
exists. suspended.
Finally, in
2014, Nokia came to their senses and switched to Android, but it was too late.
3. Unemployed
Organization
Image Structure
of the Engineering Matrix
Engineering
Matrix structure. Chart by PMI
While Nokia
operated through a common management organization until the early 2000s,
company executives decided to restructure the matrix in 2004, with the hope of
expanding the new design.
With the
reorganization, disputes began to arise. Among the disadvantages of having a
matrix structure is that few executives have equal authority, which inevitably
leads to power disputes. This, of course, has led to the departure of key
members of the executive committee.
At a time when Nokia was embroiled in an internal dispute, Apple - a major threat - was held by Steve Jobs with a laser sharpener, and was quickly gaining market share through car.
4. Loss of Smartphone Wave
Photo of the first iPhone in 2007
The first iPhone back in 2007. Note 4–16GB storage options; how times have changed.
In the mid-2000's, when cell phones first appeared, Nokia seated comfortably on a cell phone. They were invented, loved, and profitable.
Blinded by their success, they missed out on the first opportunity to deliver smartphones. In terms of their services, Nokia could have gained a lot of lead from its competitors in this area. Instead, they focus on producing strong, affordable, and traditional cell phones; exactly the opposite of what most consumers wanted.
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