Nokia Organizational Change
Table of Contents
Change Initiative to Be Researched
The initiative of the chosen company, which is Nokia Inc., is to investigate the organizational change in terms of launching smartphones. The idea is to apply all the conceptions and theories towards change management and development of organizations through the implication of factual business change initiative of Nokia. It is also intended to have an additional investigation in terms of change initiative and its meaning for Nokia. The research methodology is accomplished by means of conducting a research with respect to analyzing various relevant resources including the background information on the Nokia Inc. The purpose is to discuss around six fundamental change theories and models that are supported by findings of relevant publications from data-based research.
Background of the Organization & Change
Nokia has a great history of change that made it successful in the target market. Such great achievements were possible due to the use of innovative technologies that were constantly adapted to the needs of the target customers. Originally, Nokia was engaged in many different businesses that operated in a variety of different spheres, such as industrial electronics and telecommunications infrastructure. One of the foremost inventions of Nokia was its innovatory wireless communication technologies that helped many people to connect with the help of networking and mobile technologies (Nokia Networks, 2015).
The history of Nokia is known since 1895 in terms of its mergers with five businesses, such as forestry, cable, rubber, power generation, and electronics. One of the most challenging strategic actions of Nokia was its movement towards the telecommunications market in 1960. Back then Nokia was dealing with electronics and radio-transmission equipment. As a result, such actions of Nokia made it successful in addition to the technological and regulatory reforms. The changes in the telecommunication industries in the 1980s increased the demand of customers and overall competition in the target market (Nokia Networks, 2015).
The most demanded digital products of that time were local digital telephone and the first car phone in the world. It was the technological breakthrough of GSM, due to which it has become possible to be more efficient in terms of using frequencies, high-quality sound, and the overall capacity of digital standards until 1991. It was the starting point of Nokia to penetrate the global market since the first call made with the help of Nokia phone through the Nokia-built network. As a result of such a breakthrough, Nokia has deserved to become one of the most demanded contractors of GSM Networks in the European countries (Nokia Networks, 2015).
Due to the unbelievable success of Nokia in the early 1990s, the company made a strategic decision to take advantage of telecommunications as the major direction for the business. The idea was to become the world’s leading company in providing telecommunicating solutions in the global marketplace. Later on Nokia refused to continue its additional business directions and moved entirely into the world of mobile technologies. For many years Nokia invested in its capabilities for navigation software and digital mapping solutions (Nokia Networks, 2015).
One of the predominant products of the target market was location service that operates with the help of HERE business, which is brand of Nokia since 2012. The next was the merger of Nokia with Siemens aimed at creating a joint venture called Nokia Siemens Networks (NSN) in order to promote its newly developed telecoms infrastructure operations by the end of 2007. Consequently, NSN was the major international supplier of telecommunications infrastructure merely emphasizing groundbreaking services available due to the mobile broadband technology (Nokia Networks, 2015).
In 2011, Nokia has become the partner of Microsoft with the purpose of improving its position in the highly competitive target market of smartphones. Due to such partnership, Nokia implemented a platform operated with the Windows Phone operating system. It was dedicated to using in smart devices and was to become an alternative of Android and iOS ecosystems. Thus, Nokia was engaged in a number of changes in terms of its strategic operations that also included cultural changes. The idea of new changes in the company and its operations related to the reduced product development willing to improve the quality of products and respond to the demand of the target market (Microsoft Mobile, 2015).
In 2013, Nokia was striving to change its overall structure with the help of several transformative contacts. One of the changes involved the purchase of Siemens’ shares in the Nokia Siemens Networks. The first contract was intended for the global transformation of the company and its overall process of restructuring. At the same time, the other contract was engaged in declaration of the sale of considerably all the business of Nokia’s Devices & Services to Microsoft that ended as of April 25, 2014. As a result of such contracts, Nokia perceives an innovative strategy to build its business through the use of Nokia Technologies of HERE, and Nokia Networks as a merger with Microsoft (Microsoft Mobile, 2015).
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The overall number of changes that Nokia initiated since its creation was aiming at the improvement of its operations and promoting its products and services with the help of mergers and acquisitions with other dominant companies in the target market. Thus, the major driving forces were the establishment of new technologies through the use of strategic renewals in servicing the target customers all over the world. Thus, various parties and other stakeholders of Nokia during the process of change were a number of former Nokia businesses, company partners and other dominant companies, such as Siemens and Microsoft. The goal is to remain in the target market with respect to the implications of business restructuration and many changes in the company, its culture and overall business values (Microsoft Mobile, 2015).
Culture of the Organization
The corporate culture of Nokia was adopted for many years with respect to the entrepreneurial and market culture. It has become more flexible in the recent years when the company has chosen a challenging and improper direction in its business strategy. Overall, the changes in the culture of Nokia were engaged in the value of its competitive advantages. A well-known slogan of the company was “Connecting People”, which indicated the deeply rooted beliefs about formation of the corporate culture that reflected facilities of business operations. The original culture was involved in taking advantage of the Finland climate and natural wood materials that were adjusted in the interior spaces. As a result, such approach to the corporate culture of Nokia made its design of buildings inside and outside of facilities. The idea was to maintain the style of products and overall accomplishments of Nokia on the arena of global technologies (Nokia Networks, 2015).
The culture of Nokia is based on four main principles that the company values as the overall philosophy of serving its target customers. These principles include “continuous learning and accomplishments, respect for people, and customer satisfaction” (Microsoft Mobile, 2015). By using these principles, Nokia managed to create major opportunities for change by applying the ideas of empowerment for its employees, suppliers, business partners, and target customers. The purpose was to build long-lasting relationships and move the company towards its business success that reflects the needs of corporate culture. In other words, the goal of Nokia was to take advantage of its networking opportunities in order to create a better place for work that comprises “honesty, trust, respect and openness” (Microsoft Mobile, 2015). Nokia was inspired by the need to create a high-performance culture that would help its employees to manage their work in the best possible way.
At the same time, the perspectives of Nokia towards constant changes were based on the cultural needs as well as core values of people in the company. The indication was to achieve the greatest perceptions of the corporate culture through the application of the following principles: “achievement, challenge, respect and renewal” (Nokia Networks, 2015). Consequently, the actions of the company were to engage employees in the working process by means of embedding the cultural values in the Nokia’s network. It was important to take advantage of the core principles and values of the company in order to build the overall awareness of employees about ethical position of the company, including its “compliance, diversity, enthusiastic working environment and sustainability” (Nokia Networks, 2015).
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Simultaneously, Nokia was eager to maintain priorities of its employees with regards to their wellbeing framework. For this reason, the line managers were to make sure the wellbeing of employees is fair along with their responsibilities. Such a program of change was implemented globally in order to maintain the position of Nokia in the target market. As a result, the company recognized its employees in terms of their achievements, especially those people who actively demonstrated the core values of the company. Thus, Nokia managed to achieve global leadership by adopting such values within its culture. Altogether, there were many changes of the company in terms of its culture; however, the idea was to maintain its core values and cultural principles. As a result of such approach of the company, it managed to achieve its multiple changes with efforts that merely adopted the already existing position of the company in the target market (Microsoft Mobile, 2015).
The Change Effort
The overall change effort of Nokia could be examined through the Congruence Model of Effectiveness. In terms of internal operations, Nokia managed to take advantage of the business strategy, working business model and organizational design with the purpose to improve organizational performance. In parallel, the external operations of the company were managed through the application of corporate values in terms of customer satisfaction, employee retention, and relationships with the key stakeholders (Bort, 2014).
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At the same time, Nokia operations were engaged in the social and cultural forces, shifts of the labor market, regulations of the government, and major technological changes. As a result of such approach to the changes, Nokia managed to improve the roles of employees and their responsibilities in the workplace. It also helped Nokia to improve the process of communication with employees and thus improving the overall position of the company in the target market. Due to such measures, Nokia managed to achieve effectiveness of its operations in terms of behavior of employees (Ovide, 2014).
The change effort of Nokia was aimed at the need to change its operations with regards to the challenges of the company. Consequently, Nokia was put in the position, at which it could not have maintained its marketplace without the change in its corporate structure. One of the negative implications of change efforts was that Nokia did not take advantage of the smartphone revolution and thus missed the opportunities of the target market. In other words, Nokia was working in the wrong direction in terms of developing hardware for its mobile phone devices rather than starting its research and development process in terms of developing software applications for smartphones (Surowiecki, 2013).
Some of the change efforts of Nokia managed to improve its product life cycle as other leaders of the industry, such as Android, Google and Apple. Nevertheless, it was too late for the company since global market transition from traditional mobile phones to smartphones put Nokia in the dramatic position within the target market. As a result, Nokia faced strong competition with other companies that managed to operate with similar effectiveness but in less time and fewer efforts for creating cheap handsets in the market of mobile phones. In other words, the company has come to a situation when it had to reflect the changes in the product orientation rather than customer demands. Consequently, it demonstrated a missed opportunity for Nokia to improve its business operations in the target market (Warren, 2014).
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Simultaneously, while Nokia was chasing for new trends in the smartphone industry, it did not take advantage of developments in terms of its leadership models and overall customer satisfaction that it had before the smartphone revolution. In addition, Nokia change was not intended to improve its cultural needs, including the use of innovations and taking advantage of the entrepreneurial spirit. Moreover, Nokia no longer had an effective organizational structure that became more complex and built towards bureaucracy (Steinbock, 2010).
One of the challenges of Nokia was its poor accountability that also did not play a positive role in its change efforts. At the same time, it is important to mention that many decisions of the company to chase for the target market of smartphones were contradicting since they canceled previous decisions and put the company in a more difficult situation in the target market. Finally, Nokia was no longer in the position to maintain its meetings with the board members to manage cross-functional decisions with other members of the committees (Ovide, 2014).
As a result, Nokia faced with many negative implications that neglected its efforts in terms of positive changes that were intended to be implemented but actually did not take place. Thus, the position of Nokia in the target market demonstrates that its change efforts were not effective. However, when the company managed to make decisions in order to improve its position in the target market of smartphones it was too late for whichever positive changes (Surowiecki, 2013).
Nevertheless, Nokia strives to improve its position in the target market of smartphones by reinventing its approach to the smartphone industry by changing its workforce directions. The idea is that today the company does not make decisions based on ‘wild guesses’. Instead, it repeats the strategy of Amazon and Facebook in terms of the so-called ‘Data and Applied Science’ solution. It means that the company measures position of its products in the target market and analyses market trends. The purpose is to take advantage of collecting data, testing the position of products in the industry, gathering data and making changes based on the outcomes. The idea is to concentrate on the accountability of the company by increasing the flow of information on the core products that have stronger impact on the decisions made by the company towards changes in business processes (Warren, 2014).
In other words, it is important to mention that today Nokia operates its changes with respect to difference it makes for the target customers. One of such positive changes is utilization of middle management from the business units throughout the company. It is connected with acquisition of Nokia by Microsoft that will surely reflect other changes in the structure of the company, its organization, leadership, and engineering. Another change that could be perceived as a step towards improvements is acquisition of Nokia by Microsoft that resulted in $7.2 billion and employing extra 25,000 employees. The other change that could also be acknowledged as positive for the company is integration of additional jobs with different roles, such as “human resources, customer support, public relations, legal issues, business development, information technologies, finances and sales operations” (Bort, 2014).
Leadership of the Change Effort
The leadership position of the change effort could be perceived through evaluation of Microsoft and former Nokia executives. Some of the changes in leadership intend the cut in the number of employees. Nevertheless, the overall change of the company would be not to create the long-standing product, such as Microsoft Office or Windows. Instead, the idea of Microsoft and its executives is to develop a new technology that would improve the lives of people and their effectiveness in running a business more efficiently. However, in terms of cutting employees, the idea of Microsoft and former Nokia executives is to embrace new alternatives of building an international business based on improved strategies and innovations (Ovide, 2014).
Another aspect of change effort of the company is that there definitely will be more changes related to the management of the added number of employees that now comprise more than 120,000 people. In other words, it seems as a new challenge for changes in the operation of the company for the new coming years of Microsoft. One more change that could be implemented by the company is its implementation of cloud technologies and computer server with respect to the target products in the target market. Furthermore, an additional change of the company would be in terms of its efforts towards improving the teamwork while developing new technologies for the core products of Microsoft (Bort, 2014).
Other changes will reflect abilities of the company to maintain its operations with respect to new developments in terms of innovative products and their placement in the target market. At the same time, the company is going to implement other changes that are assumed to have positive impact on the company and its operations in the target market. The idea is to decrease the number of people who are involved in making decisions for the development of innovative products and making corporate decisions. It is believed that such changes in the company would have a positive impact on the operations of Microsoft in the target market, including the increase in the stock market. At the same time, there is a belief that Microsoft will be able to put itself from the position of greater commitment towards both mobile and cloud technologies. For example, it is intended to take advantage of the video game business through the use of Microsoft technologies in the mobile devices (Ovide, 2014).
The overall leadership of the company and its change efforts seem to become more positive in the contact of acquisition. However, it could have been different in the former Nokia Company if only it took advantage of the smartphone industry a little earlier. In other words, the leadership implications of Microsoft and Nokia could be described with the help of core characteristics of change leadership. Such implications address the following principles that could lead the company to success through the application of “trust, openness, ethical leadership, consistency, personal integrity, competence, loyalty, and fairness” (Steinbock, 2010).