Case Study Description of Nokia's Bridge Program: Redesigning Layoffs (A)
"Not another Bochum." Nokia Board Chairman Jorma Ollila was clear in the goals he set for the 2011 restructuring that Nokia's new CEO, Stephen Elop, had decided was necessary to address the dramatically changed competitive environment the company faced in smartphones and mobile phones. The strategy shift would include transitioning Nokia's phone operating system to Microsoft Windows, and closing phone R&D centers and factories in 13 countries, with layoffs that would eventually impact 18,000 employees. Yet with several important R&D projects still under development, and capacity needed in factories for many more months, Nokia's board and leaders wanted to avoid the mistakes the company had made in a plant shutdown in Bochum, Germany in 2008. EVP of Corporate Relations and Responsibility Esko Aho was mandated to develop a "Nokia way" to implement the restructuring that would reflect the company's values and allow them to maintain morale and commitment among the employees who would eventually lose their jobs. The case describes the development of Nokia's "Bridge" program, a comprehensive approach to helping employees find new employment opportunities and to replacing jobs in communities where Nokia had been a major employer. The case challenges students to make decisions such as when and how to tell employees about a layoff, how to manage local government leaders, and what support to provide in 13 different countries, each with its own legal and regulatory environment, cultural norms, and expectations and needs of employees and local communities.
Swot Analysis of "Nokia's Bridge Program: Redesigning Layoffs (A)" written by Sandra J. Sucher, Susan Winterberg includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nokia's Nokia facing as an external strategic factors. Some of the topics covered in Nokia's Bridge Program: Redesigning Layoffs (A) case study are - Strategic Management Strategies, Government, Managing people, Operations management, Reorganization, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Nokia's Bridge Program: Redesigning Layoffs (A) casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, increasing commodity prices,
geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Nokia's Bridge Program: Redesigning Layoffs (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nokia's Bridge Program: Redesigning Layoffs (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nokia's Nokia, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nokia's Nokia operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Nokia's Bridge Program: Redesigning Layoffs (A) can be done for the following purposes –
1. Strategic planning using facts provided in Nokia's Bridge Program: Redesigning Layoffs (A) case study
2. Improving business portfolio management of Nokia's Nokia
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Nokia's Nokia
Strengths Nokia's Bridge Program: Redesigning Layoffs (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nokia's Nokia in Nokia's Bridge Program: Redesigning Layoffs (A) Harvard Business Review case study are -
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Nokia's Nokia digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nokia's Nokia has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Effective Research and Development (R&D)
– Nokia's Nokia has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Nokia's Bridge Program: Redesigning Layoffs (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Nokia's Nokia has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Nokia's Bridge Program: Redesigning Layoffs (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Nokia's Nokia has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nokia's Bridge Program: Redesigning Layoffs (A) Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Nokia's Nokia has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Low bargaining power of suppliers
– Suppliers of Nokia's Nokia in the sector have low bargaining power. Nokia's Bridge Program: Redesigning Layoffs (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nokia's Nokia to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Nokia's Bridge Program: Redesigning Layoffs (A) Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Analytics focus
– Nokia's Nokia is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Sandra J. Sucher, Susan Winterberg can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Strong track record of project management
– Nokia's Nokia is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Nokia's Nokia is one of the most innovative firm in sector. Manager in Nokia's Bridge Program: Redesigning Layoffs (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Nokia's Nokia are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Successful track record of launching new products
– Nokia's Nokia has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nokia's Nokia has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Weaknesses Nokia's Bridge Program: Redesigning Layoffs (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nokia's Bridge Program: Redesigning Layoffs (A) are -
Aligning sales with marketing
– It come across in the case study Nokia's Bridge Program: Redesigning Layoffs (A) that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Nokia's Bridge Program: Redesigning Layoffs (A) can leverage the sales team experience to cultivate customer relationships as Nokia's Nokia is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Sandra J. Sucher, Susan Winterberg suggests that, Nokia's Nokia is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
No frontier risks strategy
– After analyzing the HBR case study Nokia's Bridge Program: Redesigning Layoffs (A), it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Nokia's Bridge Program: Redesigning Layoffs (A), is just above the industry average. Nokia's Nokia needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Need for greater diversity
– Nokia's Nokia has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Nokia's Nokia supply chain. Even after few cautionary changes mentioned in the HBR case study - Nokia's Bridge Program: Redesigning Layoffs (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nokia's Nokia vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Nokia's Bridge Program: Redesigning Layoffs (A) has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Nokia's Nokia 's lucrative customers.
High cash cycle compare to competitors
Nokia's Nokia has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Nokia's Nokia has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Workers concerns about automation
– As automation is fast increasing in the segment, Nokia's Nokia needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Low market penetration in new markets
– Outside its home market of Nokia's Nokia, firm in the HBR case study Nokia's Bridge Program: Redesigning Layoffs (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Nokia's Bridge Program: Redesigning Layoffs (A) | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Nokia's Bridge Program: Redesigning Layoffs (A) are -
Manufacturing automation
– Nokia's Nokia can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Nokia's Nokia can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Nokia's Nokia can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Nokia's Nokia in the consumer business. Now Nokia's Nokia can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Nokia's Nokia can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Nokia's Nokia can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Using analytics as competitive advantage
– Nokia's Nokia has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Nokia's Bridge Program: Redesigning Layoffs (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nokia's Nokia to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Nokia's Nokia can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Loyalty marketing
– Nokia's Nokia has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nokia's Nokia can use these opportunities to build new business models that can help the communities that Nokia's Nokia operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Nokia's Nokia to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Nokia's Nokia to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Nokia's Nokia can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Nokia's Bridge Program: Redesigning Layoffs (A) suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Nokia's Nokia to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Threats Nokia's Bridge Program: Redesigning Layoffs (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nokia's Bridge Program: Redesigning Layoffs (A) are -
High dependence on third party suppliers
– Nokia's Nokia high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nokia's Nokia in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Consumer confidence and its impact on Nokia's Nokia demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Increasing wage structure of Nokia's Nokia
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Nokia's Nokia.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Nokia's Nokia business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Nokia's Nokia can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Environmental challenges
– Nokia's Nokia needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Nokia's Nokia can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Nokia's Nokia needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nokia's Nokia with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nokia's Nokia can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Nokia's Bridge Program: Redesigning Layoffs (A) .
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Nokia's Nokia.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Nokia's Nokia will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Weighted SWOT Analysis of Nokia's Bridge Program: Redesigning Layoffs (A) Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Nokia's Bridge Program: Redesigning Layoffs (A) needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Nokia's Bridge Program: Redesigning Layoffs (A) is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Nokia's Bridge Program: Redesigning Layoffs (A) is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Nokia's Bridge Program: Redesigning Layoffs (A) is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Nokia's Nokia needs to make to build a sustainable competitive advantage.
