Nokia and Finland Harvard Case Solution & Analysis

Nokia and Finland Case Study Solution

Problem Statement

After the Soviet war, Finland faced the intense economic crises, which deteriorated its markets and also effected the stability position of the companies operating in the market. Such economic downturn caused the country to face the shortage of skilled labor, along with low wages which in-turn effected the buying power of the consumer which made the companies to reduce the selling prices and hence reduced profits.

In addition to this, Finland also faced the declining rate of export due to limited production capacity and resources, this also effected its global market presence and ultimately deteriorated its position in the global markets.Lastly, due to the increase in technological trend changing customer behavior and market parameters, Nokia- the largest communication business in Finland started facing the intense competition from Motorola, Samsung and Apple, and failed to sync the market needs immediately due to macro constraints present in the country.

Opportunity

Since Finland and Nokia has already set the strong market position and brand image in the global markets, it has the opportunity to incorporate the technology again into the country along with innovation in processes, which will allow it total pand penetrate the global markets, making it regain its position in the market.

Objectives

In the current situation, the objective of Nokia ad Finland both is to meet the labor demand in the market and develop the institution to educate the population in order to achieve the skilled labor market in the long run. In addition, Nokia also aims to regain its position in the market by incorporating the innovation and technology into the process, so to deal with the losing market share in the global markets and dealing with the rising competition in the country.

Situational Analysis

Country Analysis

In the initial time, Finland under the Russian Government has always remain to be a sleepy economy which restricted itself from the outer world.However, in 1980’s, the country took the freedom from the Russian governance and joined the European Union and introduced Euro as the trading currency for the country. This boosted the economic condition of the country and improved the trade, which again helped the country in developing a strong infrastructure based on innovation rather than on investment. Over the period of time, the country continually developed its internal markets which were mainly based on telecommunication, paper and pulp. The telecommunication market constituted the 80% of the export and thus rendered as the strong market in Finland.Also, after the independence from Russia, the Economic position and GDP of the country remain very high, channeling the growth to institutions, and hence developing strong skilled labor force.

However, in the late 20th century, the country met the severe economic crisis, due to soviet war.This. deteriorated the economic balance of the country and threw it into the dark economic downturn phase.The economic downturn not only effected the economic cycle, but also effected the markets immensely.The most of the effects has been witnessed on the telecommunication industry, since it directly affected the export ratio, production capability and national income which made the companies to lower the selling prices and hence gaining lower profits.

Industry Analysis- Porter 5 forces: Nokia

Bargaining Power of the Buyer

The bargaining power of the buyer is medium in the market.It is due to the availability of other alternative products and players like Motorola, Samsung and apple.In addition, the switching cost to other product is also not high, promoting the frequent switches between Nokia and other players.

Bargaining Power of the Supplier

The bargaining power of the supplier is high in the market. It is due to the strong market position of Nokia in the market along with the strong financial background in the past. In addition, Nokia is the largest telecommunication company in the Finland, contributing 80% of the market export, hence developing a strong attraction of supplier towards it.

Nokia and Finland Harvard Case Solution & Analysis

 

 

Extent of rivalry

The extent of rivalry is high in the market. It’s due to the strong position of other players like Motorola, Apple and Samsung in the market. In addition, since the global markets have other players as well, the position of Nokia in global market is under high pressure. Also, since the economic situation of Finland has been compromised, the other players like Motorola and Samsung has the chance to capture the demand in the Fin land market and also the global markets.

Threat of Substitution

The threat of substitution is medium in the market. It is due to the availability of the satellite phones offered by other providers. Along with the phones offered by the competitors,and since the cost of switching is low, the company has high threat of substitution due to competitive market forces..........................

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