Finland and Nokia

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Submitted By zumorito83
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Finland and Nokia

Executive Summary

Finland had transformed itself from a sleepy economy to a highly competitive one with maximum contribution from the telecommunications sector. Focused efforts in R&D and education helped Finland achieve this position with Nokia being a major player.
While Finland maintained its ranking as a leading competitive nation in 2001, it was facing challenges. The overall growth rates were declining and the telecommunications cluster was experiencing a severe downturn. Nokia’s revenue and profits were falling and considering the fact that Nokia and the telecommunication sector played a large role in Finland’s economy, there were concerns about the level of exposure to a single cluster and company.
Also, Finland was facing shortages of experienced engineers and scientists. Universities were offering programs tailored for foreign students in order to attract people to Finland. However, unemployment was increasing among the young and less skilled.
Nokia was facing a challenge in evolution of standards and innovation. New standards were being developed in mobile internet services as well as software and hardware for phones and infrastructure. Smart mobile phones with multimedia messaging, internet connections and downloads from websites were being around the corner.
We feel that Nokia has the options of outsourcing production to India and China to achieve reduced costs, higher production and improved benefits. They should consider development and implementation of latest technological advancements such as 3G and WAP. A new pricing strategy coupled with a suite of phones can provide the needed thrust to Nokia in order to gain further market share, higher revenues and further reduction in costs through economies of scale. Also, Finland should invite new companies to set up R&D sectors to strengthen its economy.

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