Once the pride of Finland, Nokia Corp. (NYSE: NOK) has lost its once-elevated position, not only in the ranks of the world's biggest high-tech companies but, more ominously, among Finns. Disappointed and hurt by the company's recent performance and actions initiated by the management to reduce operating costs, Finns who used to see Nokia as the pride of the nation are quietly uncoupling the image of their country from the world's perception of its best-known corporate entity.
Finns, who once proudly associated themselves with Nokia's heritage, nowadays view the mobile phone-maker as just another multinational enterprise. Finland and Nokia, it seems, may be parting ways. The country's headquarters will still be in Finland, but for Finns, this is no longer the iconic company they considered a national model.
Nokia was founded in 1865 and became the pride of a small nation with its transformation into the world's biggest mobile phone manufacturer. The company became a global leader and one of the strongest Finnish brands. With it, a strong sense of national pride was born, too. Nokia used to be the one and only brand in Finland. Today, Finns don't talk much about Nokia, and many even prefer phones from its biggest rivals, especially products from Apple Inc. (Nasdaq: AAPL). What has happened?
To start with, many Finns have lost their jobs, thanks to the new reorganization strategy being implemented by Nokia. The company has contributed to an increase in Finland's unemployment rate, and with it, other social problems, including a perception of damage to the nation's image.
The new manufacturing plant in Vietnam recently announced by Nokia means a likely reduction in the number of employees in the Finnish product development centers in Oulu and Salo, a city that entirely spins around and totally depends on the company. (See: Nokia Plans for Growth Despite Dropping Sales .)
Last month, Nokia announced that it will lay off 1,400 employees in Finland -- over five percent of its workforce in the country. There have already been 1,900 job cuts since last year. This is a huge loss for a country the size of Finland. With a population of 5.4 million at the end of 2010, Finland felt keenly the recent job cuts at Nokia, and future layoffs would seriously affect the society as a whole. Nokia’s suppliers in Finland will be affected, too, doubling the effects nationwide. No wonder Finns don't want to talk about Nokia.
Most of the Finnish press is very quiet about Nokia at the moment, partly because of the summer recess and also because Finns don't seem interested in talking about this painful subject. Some of the Finnish afternoon papers have written mainly about the bad stock market situation, or the dismissal of people in Nokia factories.
The Finns who shared some of their thoughts on Nokia with me agreed the company seems to have lost its meaning as a national icon. They feel they have lost the flagship that once made them proud. One Finn told me: "Nokia was considered a national crown jewel, and it is a bit of a shock for many that it actually is a multinational company with a non-Finn as a CEO. It's maybe a little comparable to the UK in the international politics by the time the dust of the Second World War had settled; amongst the winners, but definitely not an empire where the sun never sets anymore." As a Finnish resident, I feel the same way.
The last straw would have been if recent speculations CEO Stephen Elop was planning to move Nokia’s headquarters to California's Silicon Valley had been true. When the reports first cropped up, there was a feeling of discontentment that could be felt in the streets of Helsinki. Nokia’s spokesperson dispelled the rumor. I was told Nokia's headquarters will remain in Finland and that there were no plans to change that. At last, some good news!
Nokia has fallen to #5 in the mobile world and they made their new strategy by choosing Microsoft and Windows Phone as their operating system. It is undersandable that big changes like that are not ones bringing in the results immediately. The problem is that both Elop (the new CEO) and Ollila (ex-CEO before Kallasvuo and current Chairman of the Board) have both given statements that are not ones ANY executives should give. Both have in fact told in public that the products are inferior and/or the capabilities of Nokia software engineers are not up to par with the competition. Both statements are loads of bull.
Nokia's biggest problem has been the Symbian, it is Os that has been kept alive with "duct tape repairs" and the technology is old. This is something what Windows used to be: lot of old obsolete waste-code within and new features quickly added on top. Latest Symbian version, Anna, is the swan song of the OS. It is best version of the "modern Symbian", but still far from the competition, Android and iOS.
Maemo/MeeGo Could have been the savior from within Nokia, but Elop thought it was safer to outsource the OS development to Microsoft. It makes sense in a way, since the Maemo/MeeGo lost its prime due to internal disagreements and other less than desirable human feelings. All in all Meaemo/MeeGo never got the chance it deserved.
Right now Nokia faces BIG challenges: they have announced N9, the first and last Maemo/MeeGo device, and it will be in stores... …who knows when? Nokia’s big problem is long delivery time from the announcement date. At the same time there are rumors that many other Windows Phone manufacturers will announce their WP7 Mango devices in a week. This should be alarming, since Nokia is expected to announce their WP7 Mango devices in October the earliest and they will be on sale some time in 2012 Q1. If not even later.
I think you see a pattern here. No wonder the company is in distress. I still hope they can turrarely make agile and fast when combn the ship, become more agile and faster to response. I could write a book about this topic and still hope for better future. Still, Nokia and Microsoft have all the recourses for mobile world domination, they just need to find a way to utilize them. Two big ones ined.
Agreed ! May be the comparison with the Sports may not be appropriate here.
But as I have said in my comment when a company becomes a national icon and a matter of pride for the whole nation, it is in the national interest that the government of that nations extend a helping hand in infusing capital into that company so that it does not have to relocate or sale its stake to some foreign company. Just by feeling sad and disappointed does not solve the problem. Have the Finnsih businessmen ( other than Nokia ) or the govt made any efforts to retain Nokia's manufactruing plants in Finland ? that is the question.
I believe it to be true too. Too many times, companies don't plan correctly and when they are in trouble, the loyal people that have worked hard all along suffer the consequences.
I agree that a national company should keep jobs at home, and never said I agreed with their move to Vietnam. I do believe they need to do whatever it takes if they still want to remain in business. I am curious about the new jobs in Vietnam and the layoffs that happened in Finland. Did Nokia even consider building this manufacturing plant in Finland as opposed to Vietnam? Was the cost of labor and utilities too high? I don't know how Finland’s labor situation is, I do know that in the U.S., particularly the Midwest unions prevail. And the union mentality has cost them thousands of jobs, particularly Michigan. They were overpaid for what they were doing, (even within their own industry in other states) and the companies needed to make cuts to stay in business. It was either keep your job with pay cuts, or the jobs go elsewhere so the company survives. Needless to say the jobs went elsewhere.
Thanks for your kind comment. One of my Finnish friends read the comments here and was impressed by yours.
"I'm sure Nokia could have done things differently to begin with to prevent such a massive layoff. It seems that it is the lowest person on the totem pole that feels the weight of the ax."
If Nokia would relocate in California that would mean the end as a Finnish company. Where have you seen a national company that keeps its headquarters in a different country? That would mean that Microsoft has then bought the company, right?
Don't you think a national company should first give jobs to the locals instead of taking the jobs from them and then go and create 10,000 jobs somewhere else? That is not expanding, as it was said at the beginning. That is called something else.
This is not about being fans or not. This is about people and their jobs to sustain their families.
If you are right, that is what Nokia needs. Of course the hardware is not the problem but do you think Microsoft has enough experience in developing mobile software or is it just the Windows name what is counting here?
I have read somewhere about the new "Microsoft Windows phones" instead of "Nokia Windows phones". It really makes a difference. So, what is going to be the leading company: Nokia or Microsoft? Or should it be Nokia-Microsoft Wndows phones? Or it will depend on how many Nokia's stocks Microsoft buys?
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