Nokia has announced the first phase of its new strategy30. 10. 2020 Friday / By: Robert Denes / Business / Exact time: BST / Print this page
Nokia has announced the first phase of its new strategy, a change in operating model and a team of team leaders. First, that technology leadership will be the top priority; second, that the company's customer base of current telecom operators and businesses (including web companies) provides a solid foundation for value creation; thirdly, that there is scope for the transition to higher value business models as a 'network service' in the longer term; and fourth, this core strategic concept between endpoints is being replaced by an enhanced approach, and each of the company’s new business groups has a distinct role in the overall strategy.
A new corporate strategy, divided into three phases, starting today; a new operating model that will take effect on January 1, 2021, and aims to better position the company for changing markets and adapt to customer needs.
“Our industry is undergoing profound changes. Industrial automation and digitalization are increasing customer demand for high-performance networks, with a trend towards open interfaces, virtualization, and cloud native software. This will revolutionize how we design, deploy, manage and sell our products and solutions,” said Pekka Lundmark, President and CEO.“As we work to renew our strategy, we will ensure we are well positioned to leverage these trends, improve our performance and position the company for long-term value creation.”
At this point, Nokia’s strategy review has reached four conclusions. First, that technology leadership will be the top priority; second, that the company’s current customer base, consisting of telco operators and enterprises (including webscale companies), provides a solid platform for value creation; third, that there is a longer-term opportunity to move into higher-value “network-as-a-service” business models; and fourth, that end-to-end as a core strategic idea will be replaced with a more focused approach, with each of the company’s new business groups having a distinct role in the overall strategy.Nokia will have four P&L-responsible business groups structured around unique customer offerings, with ownership for becoming one of the market leaders in their respective sector. They will also need to demonstrate a clear route for delivering shareholder value with return on capital employed as a key metric.
“Our goal is to better align with the needs of our customers, and through that increase accountability, reduce complexity and improve cost-efficiency. Going forward, we will have a more rigorous approach to capital allocation and will invest to win in those segments where we choose to compete,” said Pekka Lundmark.
The new business groups are:
In addition to these four business groups, there will be a Customer Experience organization that will provide a common interface with customers and will act as the voice of the customer across all business groups. This unit will include Nokia’s customer teams, region...read moreVia Link