"Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence
Nokia has dominated the mobile handset business for over 20 years. But as mobile technologies evolves and the consumer focus shiftsfrom handset design towards software and content platforms, it creates an opportunity for new players, such as RIM, Apple and Google, to enter the market and challenge Nokia's position. This case examines the competitive situation in the mobile ecosystem and Nokia's attempt to redefine itself as an 'internet company' in 2008.
Authors :: Chen Wei-Ru, Javier Gimeno, . Workiewicz, Jose De La Torre
Swot Analysis of ""Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence" written by Chen Wei-Ru, Javier Gimeno, . Workiewicz, Jose De La Torre includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mobile Handset facing as an external strategic factors. Some of the topics covered in "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence casestudy better are - – increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, central banks are concerned over increasing inflation, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, increasing energy prices,
increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mobile Handset, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mobile Handset 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence can be done for the following purposes –
1. Strategic planning using facts provided in "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence case study
2. Improving business portfolio management of Mobile Handset
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mobile Handset
Strengths "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mobile Handset in "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence Harvard Business Review case study are -
Highly skilled collaborators
– Mobile Handset 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Mobile Handset has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mobile Handset to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Mobile Handset
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mobile Handset does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Mobile Handset 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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.
Low bargaining power of suppliers
– Suppliers of Mobile Handset in the sector have low bargaining power. "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mobile Handset to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Mobile Handset 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.
Ability to recruit top talent
– Mobile Handset is one of the leading recruiters in the industry. Managers in the "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Mobile Handset 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 Chen Wei-Ru, Javier Gimeno, . Workiewicz, Jose De La Torre 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.
Sustainable margins compare to other players in Strategy & Execution industry
– "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence firm has clearly differentiated products in the market place. This has enabled Mobile Handset to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Mobile Handset to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Mobile Handset 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Mobile Handset digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mobile Handset 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.
Weaknesses "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence, in the dynamic environment Mobile Handset has struggled to respond to the nimble upstart competition. Mobile Handset has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Chen Wei-Ru, Javier Gimeno, . Workiewicz, Jose De La Torre suggests that, Mobile Handset 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.
Slow decision making process
– As mentioned earlier in the report, Mobile Handset has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Mobile Handset even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Capital Spending Reduction
– Even during the low interest decade, Mobile Handset 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.
Products dominated business model
– Even though Mobile Handset has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Mobile Handset 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 cash cycle compare to competitors
Mobile Handset 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.
Slow to strategic competitive environment developments
– As "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence HBR case study mentions - Mobile Handset takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High operating costs
– Compare to the competitors, firm in the HBR case study "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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 Mobile Handset 's lucrative customers.
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 Mobile Handset supply chain. Even after few cautionary changes mentioned in the HBR case study - "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mobile Handset vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mobile Handset is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence | 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence are -
Creating value in data economy
– The success of analytics program of Mobile Handset has opened avenues for new revenue streams for the organization in the industry. This can help Mobile Handset to build a more holistic ecosystem as suggested in the "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence case study. Mobile Handset can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mobile Handset can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Mobile Handset 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Mobile Handset is facing challenges because of the dominance of functional experts in the organization. "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Mobile Handset 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.
Developing new processes and practices
– Mobile Handset can develop new processes and procedures in Strategy & Execution 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mobile Handset in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mobile Handset 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 Mobile Handset to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Mobile Handset 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mobile Handset to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Mobile Handset can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mobile Handset 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Mobile Handset can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Mobile Handset 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 Strategy & Execution segment.
Threats "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence are -
High dependence on third party suppliers
– Mobile Handset 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.
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 Mobile Handset business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Mobile Handset 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.
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 Mobile Handset.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mobile Handset 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence, Mobile Handset may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Mobile Handset can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Mobile Handset is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Mobile Handset with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Mobile Handset 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. Mobile Handset can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mobile Handset in the Strategy & Execution industry. The Strategy & Execution 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.
Weighted SWOT Analysis of "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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 and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence 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 Mobile Handset needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of "Nokia and the New Mobile Ecosystem: Competing in the Age of Internet Mobile Convergence
