Swot Analysis for Nokia

SWOT analysis for Nokia

Introduction
Nokia Corporation is one of the world’s largest telecommunications equipment manufacturers. It has since established a leading brand presence in many local markets, and business has expanded considerably in all areas to support customer needs and the growth of the telecommunications industry. Nokia also produces mobile phone infrastructure and other telecommunications equipment for applications such as traditional voice telephony, ISDN, broadband access, professional mobile radio, voice over IP, wireless LAN and a line of satellite receivers. Nokia provides mobile communication equipment for every major market and protocol, including GSM, CDMA, and WCDMA and it is know globally for its reliable and good quality products.

SWOT Analysis

|Strengths |Weakness |
|Strong Brand name |Inability to keep up with competition |
|Largest Cellular company |Bureaucratic corporate culture |
|User-friendly Design |Slow in innovation |
|Large Distribution Channel |Low promotions |
|High range of products |Cutting jobs |
|Ovi platform to provide services |Swollen by its early success got complacent |
|Navteq for digital mapping and communication |Technical problems with operating system |
|Ongoing R&D |Poor after-sale service. |
|High level staff change | |
|Opportunities |Threats |
|Develop new Smartphone |High Competition in Smartphone |
|Global presence |Losing investors confidence |
|Growth in telecommunication industry |Falling market share |
|Expand through partnership |Falling share prices |
|Adopt new operating system |Missing a cycle of new and innovative phone |
|Improve its ovi store |Pays less for workers in developing countries. |
|New revenue from software and services sold on Smartphone | |
|Increase income through subsidiaries | |
|Large role in Finland’s economy | |

Strengths:

1) Nokia has a strong brand name globally and in many countries the word ‘Nokia’ is synonym to cell phones. According to a survey by Inter brand in 2010 Nokia is the 8th most respected global brand. 2) The major and unbeatable strength of Nokia is that it is world’s largest cellular company with its presence in many large economies like India and China. 3) Nokia phones have user-friendly and innovative design. 4) Nokia has a large distribution network through carriers and through distributors who resell unlocked phones world wide. 5) Nokia phones have a high price range and are available for all social classes, this also adds to popularity of the brand. 6) Nokia phones have high resale value. 7) Ovi platform introduced by Nokia offers services like games, music, media, messaging etc. 8) Nokia owns a subsidiary of its own, Navteq, which is used for digital mapping and navigation. 9) Nokia is doing a high level staff change, as it is seeking a transformation after losing ground to Apple’s iphone. Stephen Elop from Microsoft took over as CEO of Nokia in September 2010. 10) Nokia’s on-going R&D which contributes to 27% of its work force, which is spread in 16 countries can help it develop new and improved products.

Weekness:

1) Nokia’s inability to keep up with competition made it loss ground in Smartphone market. 2) Due to its bureaucratic corporate culture, the employees where not able to get their new ideas passed. 3) Nokia is not spending enough money in promotions and marketing. 4) Very slow innovation made the competitors over take Nokia. Lost lead in several crucial areas to fast track its design for touch screen, software applications,3-D interface. Though industries first in touch screen with stylus but did not prefect the technique of figure tip before Apple. 5) Organization got swollen by its early success, grew complacent, slow and remote from its consumers. 6) Due to reduced profits Nokia is cutting jobs. 7) Technical problem with Nokia’s operating system symbian, and not able to support more sophisticated Smartphone’s.

Opportunities:

1) Nokia has advantage over other cellular companies, and its competitors have a very long way to compete it actually. It can capture more market share and attract more customers in existing market by changing price and introducing new product. 2) Nokia’s promotions are like to strengthen its reputation and increase its sales. 3) Telecommunication industry is growing rapidly and this creates a great opportunity for Nokia to expand. Nokia’s subsidiary Siemens network produces telecommunication equipment. 4) Adopt new operating system, Nokia’s planning to bring its next generation Smartphone in windows 7. 5) Nokia can Expand through partnership with different operating system and different carriers etc. 6) Improve its Ovi store to compete with Apple’s. 7) Nokia’s is the largest Finnish company and it contributes to 10% of its export and it is still a pride of Finland.

Threats:

1) Nokia is not keeping up with its competition, its triple threats are Apple’s iphone, RIM’s Blackberry and other android based phones from Samsung, LG etc. 2) Nokia is losing investor’s confidence, as is evident from falling share prices. 3) Nokia market share is declining, which is not a good thing since it means Nokia’s customers are substituting its competitors products. 4) Nokia missed a cycle of new and innovative phones and so it has a lot of catching up to do. 5) Claim that Nokia is paying less for its workers in developing countries, can come to haunt it sometime later.

Conclusion
Nokia is a good example of what can happen to a company in today’s world if it is not keeping up with the changing environment. The environment in which they do business is evolving continuously. To succeed, they must have the passion and courage to look for new ideas beyond existing products, services and ways of working. Only with truly innovative ideas will Nokia be able to define the future development of the industry and profoundly shape the way in which people understand and use mobility in their everyday lives.