For this essay, we will analyze the external and internal forces affecting Nokia Corporation. These forces define the business environment of Nokia company. The internal environment consists of management style, climate, and organizational structure. The external environment consists of technological, legal, social, economic, and political factors. Strategic analysis at Nokia for instance, requires close attention to these forces. In the past, Nokia sought a new growth area to complement the hugely successful mobile phone and network businesses. Finally, their efforts began in 1995 with the New Venture Board, but it failed.
The problems faced by Nokia company were the results of poor strategic management.
EXTERNAL AND INTERNAL FORCES; BUSINESS MODEL TRANSFORMATION NOKIA
Nokia Corporation is an example of a corporation whose business model transformed dramatically. The change was as a result of the dynamic business environment of Nokia company. The most notable changes occurred in the period 1985-1995. It was when Nokia expanded from the focus on paper, rubber, and cable industries to the field of consumer electronics. Strategic analysis at Nokia influenced these changes. More change resulted in more focus on mobile telecommunications: mobile telephones and mobile telecommunication networks. However, a further need for change led to the problems faced by the Nokia company. Lastly, divestments of businesses and a new focus on mobile telecommunications saved the company from demise.
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ECONOMIC ENVIRONMENT OF NOKIA COMPANY
The business environment of Nokia company comprises of the micro-environment and macro-environment. The micro-environment includes employees, customers, suppliers, materials, and other stakeholders. Macro-environment consists of economic, social, political, and legal factors. For instance, poor strategic analysis at Nokia led to Nokia’s decline in mobile phones. These included poor management decisions, dysfunctional organizational structures, growing bureaucracy, and deep internal rivalries. They, therefore, led to the problems faced by the Nokia company. Finally, these problems prevented Nokia from recognizing the shift from product-based competition to one based on platforms.
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