Global Strategies in the Converging Communications Industry

Transcription

1 Global Strategies in the Converging Communications Industry 58. Deutscher Betriebswirtschafter-Tag Dr. Matti Alahuhta Executive Vice President Chief Strategy Officer, Nokia 1 NOKIA 2004

2 Contents 1. Changing Landscape 2. Key Strategic Challenges 3. Leadership Challenges 2 NOKIA 2004

3 Changing High Tech Landscape Past Market Competitors Company Suppliers 3 NOKIA 2004

4 Changing High Tech Landscape Past Drivers of change Competitors Market Company Digital convergence Horizontalization Globalization Suppliers 4 NOKIA 2004

5 5 NOKIA 2004 Major Industries are Converging

6 into Converged Digital Industry Conventional market boundaries are blurring 6 NOKIA 2004

7 Horizontalization Is Changing the Nature of Competition Past Today/Future Services Appl. HW Middleware Components Consum er Electroni cs Informatio n Technolo gy Media & Content Telecom m End-to-end value offerings The role of software and applications is increasing in importance Companies are competing by increasing the information content of their products and service 7 NOKIA 2004

8 Globalization: Role of Key Emerging Markets Increasing China and India are becoming increasingly important to the global economy Due to their enormous populations and economic development with significant implications on their role as both markets and sources of supply growth in users of Internet and Mobile subscribers (millions) Population under 14 years old in selected countries (millions) Internet China Mobile Subscribers Western Europe Source: Economist Intelligence Unit 38 USA 71 India Japan Russia USA W. China India Europe 8 NOKIA 2004

9 Globalization of Professional Services The arrival of digital business processes has opened previously protected service industries to global competition. Forcing companies to evaluate where, and by whom, core business functions are carried out. U.S. output per worker ($k) in 2000 dollars 208 goods services Source: Business NOKIA 2004

10 Changing High Tech Landscape Competitors Past Market Company Drivers of change Digital convergence Horizontalization Globalization Now/Tomorrow Partners and Coopetitors (multiple roles) Company Suppliers Market (turbulent, global, converged) 10 NOKIA 2004

11 Towards an Extended Enterprise With Orchestration Capability with capability From traditional large enterprise Partners Core to extended enterprise Partners Core Demand Architecture Innovation Supply Demand Architecture Innovation Supply Product Demand Demand Architecture Demand Architecture Innovation Supply Innovation Demand Architecture Innovation Supply Supply Demand Demand Architecture Supply Innovation Demand Architecture Supply Architecture Innovation Supply Architecture Innovation Supply 11 NOKIA 2004

12 Contents 1. Changing Landscape 2. Key Strategic Challenges 2.1. Market Making 2.2. Strategic Agility 3. Leadership Challenges 12 NOKIA 2004

13 2.1. Requirements for Successful Market Making Gain end user acceptance Multiple domains of life Simplicity Personalization Lead in key technologies Architectural competencies Software & hardware Product concepts and design Win-win business models Increasingly based on partnerships Cooperation across industries Opportunities for all players 13 NOKIA 2004

14 End Users Are Adopting Intuitive Services Over 70% uses applications utilizing GPRS link TRAFFIC VOICE Over 40% have sent MMS MESSAGING IMAGING An average user takes 52 photos / month Browsing popular. Generates 76% of the GPRS traffic. BROWSING APPLICATIONS Over 30% have installed 3rd party applications ca. 3-4 application / month Source: Nokia originated study on the Nokia 6600 usage in UK and Germany, June NOKIA 2004

15 Comprehensive Technology Portfolio IP convergence Multi-access Imaging Music, mobile TV Content sharing Security/DRM 3G: GPRS/EDGE/WCDMA/HSDPA Multiradio Software platforms and architectures User experience & design Internet (Media) domain Mobile domain Consumer Home domain Enterprise domain Interoperability of content & services Secure mobile connectivity and mobile office Device and service management Convergence of fixed/enterprise/ mobile networks 15 NOKIA 2004

16 Win-win Business Models for End-to-end Solutions Content Networks Service enablers Operator Devices Consumer Mobile systems integration 16 NOKIA 2004

17 Right Timing and Speed Are Crucially Important in Market Making Traditional Strategies Doing Planning Now Future Excellence in Execution How - Speed - Quality - Openness Market Making Strategies Winning Foresight What - "Reading the Market" - Right timing INNOVATION Now Future 17 NOKIA 2004

18 2.2. Need for Strategic Agility Need to dynamically (with right timing, speed & rhythm) combine Internal & external assets/resources for Effective & Efficient value creation and capture Value Creation Excellence in Innovation/ Emergence Strategic Agility Excellence in Execution Value Capture 18 NOKIA 2004

19 Excellence in Innovation and Emergence New Nokia Research Center Ventures Excellence in Innovation/ Emergence Excellence in Execution Technology Existing Core Businesses Existing New Market 19 NOKIA 2004

20 Nokia Fosters Renewal and Innovation in Many Ways Excellence in Innovation/ Emergence Excellence in Execution Vision and Strategy Driven Core business development ROI Driven Internal venturing "Funds" 20 NOKIA 2004

21 Combining Economies of Scale and Agility for Excellence in Execution Economies of scale Excellence in Innovation/ Emergence Excellence in Execution YYY ZZZ XXX Nokia 2000 Nokia 2002 Nokia 2005 Nokia 1997 Agility 21 NOKIA 2004

22 Requires a Flexible Organizational Architecture Rapidly changing markets Market opportunities FIT Excellence in Innovation/ Emergence Excellence in Execution Reconfigurable business systems Modular business infrastructure Process A Process B Process C Processes Business system 1 Business system 2 Business system 3 Apps & Data IT Platforms FIT Combining Economies of scale and Agility 22 NOKIA 2004

23 Nokia Structured for Convergence and Growth Customer and Market Operations Excellence in Innovation/ Emergence Excellence in Execution Technology Platforms Mobile Phones Multimedia Networks Enterprise Solutions Research, Venturing and Business Infrastructure 23 NOKIA 2004

24 Key Organizational Dimensions Excellence in Innovation/ Emergence Define an optimal organizational configuration for each situation and strategy Global learning Global scale leverage Networked, modular Hierarchical Excellence in Execution Exogenous Endogenous Ethnocentric Polycentric Geocentric 24 NOKIA 2004

25 Contents 1. Changing Landscape 2. Key Strategic Challenges 2.1. Market Making 2.2. Strategic Agility 3. Leadership Challenges 25 NOKIA 2004

26 People Strategies in the Changing Landscape Ensure that Nokia is a great place to work for a global workplace Working together, making a difference Drive competence renewal to enable business success Driven by personal passion and purpose Motivated by energetic leaders and inspiring vision Enjoying the diversity of the work environment In an extended enterprise environment Enable an adaptive, selfrenewing organisation 26 NOKIA 2004

27 Right Balance Between Leadership & Management Fact based management Values based leadership Clear targets Common management principles and tools Common modular processes Customer Satisfaction Respect Achievement Renewal 27 NOKIA 2004

28 Evolving Leadership Roles Team Leadership Business Leadership Strategic Leadership Coaching people and Mobilizing people and implementing strategy leading teams Team Leadership Inspiring people and orchestrating business and strategic direction + Business Leadership + Team Leadership Responding to a global and complex business environment 28 NOKIA 2004

29 Summary Changing High Tech Landscape: Digital convergence Horizontalization Globalization Towards an extended enterprise with capability Requirements for successful market making End-user acceptance Lead in key technologies Create win-win business models Need for strategic agility dynamically combine internal & external assets/resources for Effective & Efficient value creation and capture Right balance between leadership & management 29 NOKIA 2004

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