Who must had thought a decade back that majorities’ favorite mobile phone brand Nokia would sell itself because of failing to sell handsets to customers? Though holding and reaching huge market, Nokia was unable to continue selling its mobile brand as it used to be. Its failure story shall be the good and reminding moral lessons to any of the entrepreneurs.
After more than 40 prideful years in telecommunication industry, Nokia fell devastatingly in the market and was forced to sell its handset business to Microsoft Inc. for $7.2 billion. What went wrong to this mighty mobile brand? The answer lies in the combination of lack of instant and adequate strategies.
Moral 1: Execution is the key
Spending enormous amount of resources and time in Research and Development, Nokia yielded many fruitful findings and ideas. Nokia had sufficient aspiring ideas that were ready to get ‘sealed and delivered’. But what put it behind was a lack of visionary strategies to translate R&D’s findings into products that people wanted to buy. Nokia is said to be the first to prototype smartphone ideas in 1996 with touch screen and Internet enabled phones. Although Nokia implemented few ideas of smartphone through Symbian OS, those were only partial executions. There were not major updates to Symbian to put into actions what Nokia had prototyped earlier. Many entrepreneurs too have admirable ideas, but these become good for nothing when not implemented. This gives the lesson of execution is the gateway of market to sell the ideas.
Morale 2: Be dynamic and don’t always stick to past successes
Nokia had enough market to influence from its innovative releases. The introduction of Symbian Series 60 devices in 2002 introduced consumers to smartphone market. Nokia, from this, took vital step in influencing mobile phone users to switch from their need and use of handset. It continued to extend its long run revenue till 2007/2008. Something was not right. Most of its revenues were not coming from smartphone. Enthralled and imprisoned by past successes, Nokia was less focused to its Symbian updates and smartphone business. And then came Apple in a dynamic smartphone market which Nokia had created from Symbian OS release in 2002 and had visualized in 1996 (the year when Apple took Steve Jobs back and was struggling with NeXTstep OS). Apple showed how smartphone could be innovative from the introduction of iPhone in 2007 and yet Nokia failed to react with its possible innovations. Meanwhile, Android participated in the race to take users into new height of smartphone experiences. Nokia was unable to respond to shifting consumer demands and its Symbian OS aged to provide what consumers opted for dynamic technological features as in Android and iOS. This informs entrepreneurs not to stick too much with past successes. Any entrepreneurship firm can fade away from market if it fails to adapt to changing needs and patterns. After all, consumers want finest and constant innovations.
Moral 3: Look beyond yourself
Nokia had always given superior quality hardware, but it was software that was its weakness. Though Nokia was an expert in building physical devices, it failed to develop programs that make devices worthy. It highly underestimated the importance of third part application features which Android and iOS promoted as value added services. Symbian needed its own custom build of OS which restricted the reachable market of the third party apps. Nokia had features of downloading apps from Symbian but felt such feature was something only a minority of consumers would want. It didn’t become the main point unless Apple started mainstreaming commercials about downloading apps to iPhone and iTouch. The moral lesson from Nokia’s reluctance of software development, refers to Michael Jackson’s quote “Look beyond yourself”. Entrepreneurs ought to move beyond from what they are good at and surpass their own limitations. It is better to accept your weaknesses and workout to rectify them. You never know your weakness can prevail over your strength.
Moral 4: Watch out for competitors
Nokia’s early rivalry in smartphone business was with Apple and then slightly divided to Samsung too. Incapable of hitting these two brands back, Nokia got hit from other unascertained competitors. The mobile brands like Sony, HTC, LG, Motorola started hitting Asian markets so hard that not only Nokia’s early users began to fade away, but cost conscious users too shifted to various other mobile brands. Nokia had not thought of these companies to be its rival in smartphone business which helped in seizing the Asian markets from it. The moral is to prepare well enough to protect yourself from unrecognized threats. It is better to study and know the enemies or defense properly because you may not take other firms to be your competitors, but they may take you as.
Moral 5: Be quick or be dead
This one is the most striking lesson that Nokia could lay to any entrepreneur. When iPhone was released in 2007, it changed the definition of smartphone with its smart touches and app based amenities. Nokia should have reacted quickly with added modification to its Symbian instead of insisting that its superior hardware design would win the race. Furthermore, Android was released in 2008 and many mobile brands climbed quickly on smartphone market. Nokia’s introduction of mobile phones were disappointing and far too behind to race with Android and iOS. By the time Nokia released its first MeeGo powered smartphone, the N9, in 2011, it was already too late to compete and consumers were adapted to other updated smartphone brands. Windows phone, it introduced in 2011, raised the hope for Nokia but by then Android and iOS had moved far ahead with their constant series and updates. Any entrepreneurship firm failing to realize the importance of being updated and competitive can be grounded so low that it might get lost from the market it had created before. Either you move ahead or prepare yourself to fall backward like world’s once dominant mobile phone maker. The morale of the story is slow and steady does not always win the race.
- Rujan Shrestha
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