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How Nokia’s cellphone fumble grew Finland’s start-up culture

Posted by Stephen Parry on Jul 12, 2016 6:00:38 AM

The urgency for businesses and organisations to become adaptable and agile is growing.

A large organisation can succeed and lead but they must be able to continually respond to new challenges and changing customer needs. Absent such an organisational strength they will find themselves struggling to compete against new startups looking to eat their lunch.

Nokia faced such a challenge almost ten years and they failed in reacting to that challenge.  The result was an unplanned and perhaps unexpected legacy.

Nokia was ubiquitous in the cellphone market in the early 2000s, its flip phones going head to head with Motorola in the flourishing portable communications market.

Unfortunately the company culture was so volatile and insular, that when Apple announced the first iPhone in early 2007, Nokia dismissed them as a competitor.

Nine years on, Apple and Android device manufacturers, such as Samsung, own the smartphone market. Nokia’s flip phones are sitting in junk drawers around the world, right next to Blackberrys and PDA devices.

While the fall of Nokia is a fascinating story of corporate failure, what happened in the wake of their collapse is even more interesting.

Nokia’s retrenching as a business, put hundreds and perhaps thousands of Finnish IT professionals out of work. Unsurprisingly many of them started up new companies and IT projects. And while Finland always had a solid start-up culture, Nokia’s decline boosted it by significant degrees.

If Nokia had been nimble enough to respond to the reality of the rise of smartphones, they might still be a major player in the computer device market.

Instead, many of their finest minds are working on their own initiatives with no formal connection to the company that gave them their start.

To be certain, the startups in Finland are a good example of how Nokia should have reimagined their company to compete in the fast changing digital device landscape.

Nokia could have had it both ways. But an inability to respond to an evolving competitive threat left them floundering.

The takeaway from this is that although this story is almost ten years old, the need for organisations to be responsive and adaptive is more pressing than ever.

If your organisation needs to get in good business shape, please get in touch with us at Lloyd Parry International and we’ll show you how to compete and win in an increasingly demanding marketplace.

Topics: Adaptability, sense and respond, Change Leadership, Work Climate