In the fast changing dynamics of socio economic and technology driven environment, businesses need to evolve creative strategies to meet the demands of the time. Bateman and Zeithaml (1990) assert that environmental changes necessitate organizations to evolve and adapt the changes within their business strategies…
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It is vital part of organizational success as it not only helps them to survive but also facilitates in maintaining competitive edge against their rivals in the industry. Business strategies are actions plans developed to achieve the vision, mission and objectives of the organizations over a long period of time. Porter (1996) says that competitive strategy is doing business differently to give value to the customers and maintain leverage. The strategic plans therefore, are vital ingredients that allow firms to be flexible and innovative so that they can absorb environmental changes and evolve to maintain one’s market position. The report is primarily an effort to analyze the business strategies of Nokia and Nestle which have made tremendous changes within their strategies to create niche market position in the domestic and global market.
Outline of strategic issues of Nokia
Nokia is a Finnish conglomerate that has incredible growth story. It has emerged as a flagship company mainly because it was able to anticipate and preempt environmental changes to evolve new strategies. The foresightedness of its managerial leadership was able to steer it to its present success. There were three major strategic issues with Nokia which needed to be creatively designed and developed to facilitate leadership position in the global market. The first one was to redefine its strategies towards its low performing business activities which did not offer long term sustainability of good profits or prospects. The second was to identify the business which had wide scope prospects vis-a-vis business opportunities across the globe. Third and the last one was to ensure that the products should be able to meet the changing demands of the global customers and should have futuristic scope to attract them. These were critical issues which needed to be addressed urgently by the company so that its vision of becoming a successful global entity could be expedited and realized. 3.1.1 Situation analysis of Nokia Finland was a rich but small nation that was bogged down with geographical hardships that made it difficult to adopt traditional technology to improve its communication and other related development processes. It initially had diverse interests comprising of tire manufacturing, paper production, consumer electronics and telecommunication equipment. The disinvestment of many of its business activities helped it to focus on telecommunication. It was one of the companies that had pioneered wireless technology to overcome geographical constraints of near arctic conditions which made cable based telecommunication a difficult and expensive venture. Indeed, strategic planning is at the heart of business strategy. Bateman and Snell (2009:132) emphasize that planning is ‘the conscious, systematic process of making decisions about goals and activities that an individual, group, work unit or organization will pursue in future’. Nokia had demonstrated its leadership initiative by disinvesting its low prospect business activities and correctly identifying potential in the telecommunication where wireless technology had offered huge scope for business expansion. It was focused on organization’s long term goals and objectives for its success and growth. It explicitly emphasized the unique activities and approaches of Nokia leadership for delivering its strategic goals and objectives. Kotler & Keller (2007) have stressed the need to be innovative and service oriented. Nokia was able to align its strategic action
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