Market Position of Nokia in Mature Europe - Coursework Example

Market Position of Nokia in Mature Europe Introduction and Description of Literature According to Lambert & MERCER (1994), empirical refers to information in form of numbers (quantitative) or word (qualitative) that is gotten or acquired through observation, experience or experimentation, to give a scientific backup for evidenced based practices. Scientifically, empirical refers to the use of a working hypothesis that gives room for testing using the methods of either observation or experiments, so as to produce evidenced data. In other words, empirical research focuses on observation and experimentation to provide evidence, and normally, it is conducted to test a hypothesis. The economic sector works to collaborate with different departments, to solve major issues in designs, socioeconomic aspects, and improve on new mechanisms of, trading, voting, auctions, networking, matching, among others. Most organizations achieve their goals of economic research through combined theories, practical policies and laboratory experiments. This targets the main goal of research in advancing scientific knowledge and providing practitioners with implementations that have been properly tested in the laboratory Cane & Kritzer (2010).  For the companies to thrive to successful levels, it is upon them to work towards a common goal and look for sufficient time to hold meetings and do careful evaluations of all strategies they have so as to work in one direction. Before making any final results, the companies should put into consideration the basic ratios and look into whether the set objectives can be met in order to ensure they are in the right track. This clearly explains that, Empirical Economic Research helps to examine the driving forces and the outcomes of various economic activities as expounded by Thomson banker, that, before announcing any final results, companies should be able to solve major issues in designs or socioeconomic aspects, and be in a position be to improve the new mechanisms of, trading, voting, auctions, networking, matching, so as to work towards their targets. Banker still expounds that the targeted organizations should have in mind the basic ratios and look into whether the set objectives can be met in order to ensure they are working in the right direction. This is evident when the companies that have merged need to set targets in that in case a business fails to meet the standards already set, they are subject to penalties where some amount of money is set aside to pay all the services that it received and was not successful. This is subject to happen due to fluctuations in market prices, services or workforce turnover and the new employees lack morale, depending also with the types of services been offered. The Performance of the Company (Event Study) Research done by Thomson has found it good to expound on the impacts that are normally brought by mergers in various companies. The topic to run through will be Nokia Company and how mergers have strived to work towards attaining the set standards for the good of the society. It needs to be measurable and that which can be practiced to best explain profit margins that are taken to be of priority when it comes to business. The idea is best applicable when previous earnings of various mergers listed and after feeding the information in a company’s Profile which has Pre-built report that loads automatically when performing a search by a ticker or any other identifier. The report should describe the business, key financials and ratios, news, an interactive price chart, as well as earnings forecasts and revisions for the company of interest, as they work towards achieving their set goals which at the end, they are expected to sit down and see whether they were able to attract a large market, if there is any changes in the economy or whether customers are satisfied with services provided by Nokia. Also, the companies Suomen Gummitehdas, Suomen Kaapelitehdas and Nokia Ab, before merging they were in a position to establish an attractive market to the customers and in turned gained their profits. An example is when Nokia worked on the internal strengths where it had set its target of reaching to people all over and went to an extent quitting consumer electronics in the 1990 and concentrated on telecommunication. This made Nokia flourish, and began changing appearance of phones in terms of features, sizes so as to beat the upcoming cell phone companies, which will evaluate whether the set standards are met or not in terms of quality service provision, meeting customer needs and raising the market value in the economic sector so as to capture the external market Funk (2008). External expansion is seen when a mergers are involved in the process of branding, purchasing and selling a product or service with a goal of increasing growth opportunities. Actually, acquisition occurs when one of the companies among the merged ones, takes responsibility over the others and rise to be the new owner. It works best under different companies that want to merge, after feeding information in a company’s Profile which has Pre-built report that automatically loads when performing a search by a ticker or any other identifier. This report describes a business, key financials and ratios, news, an interactive price chart, as well as earnings forecasts and revisions for the company of interest. Bollinger Bands which Envelopes that surround the price line on a chart are normally plotted two standard deviations and adjust themselves to the market conditions - they widen during volatile market periods and contract during less volatile periods. An example of a database that gives room for companies to put dates in announcements Data is entered according to specific dates set; those of declaration are listed separately for each quarter. For a company to get an announcement, they are required to select each quarter. They then go to the A search for a company is then done from a company’s Profile which has Pre-built report that automatically loads when performing a search by a ticker or any other identifier. The report describes a business, ratios and key financials, news, an interactive price chart, as well as earnings forecasts and revisions for the company of interest, while viewing, the company scrolls down until they come to the news section and clicks on important developments. Each announcement is clicked to expand it for more details. This enable monitoring of a profit margin based on previous earnings before calculating interests and removing expenses on tax. This is usually identified when the different companies list them in the company’s profile tab, and allow mergers do their evaluation before coming together and also it will help know among the mergers, which company will take an acquisition post, in the Nokia Company. Thomson banker identified a number of criteria which companies must undergo apart from the set standard, and he explained that, for mergers to come together, and become successful, there is need to undergo a criteria to meet the set standards like, proper scrutinization through benchmarking which entails, companies selecting via graphs those which match their criteria’s, after a careful analysis of the previous trends. This helps explain whether a company is making any progress and gives room to merge with another because it is seen to be picking up and can attract more customers, in exchange or profits. This is further explained by an interactive price chart where the features of Thomson ONE Banker allow users to customize a chart, by identifying a benchmark index or another stock price line, in a given time period, and selecting a technical analysis tool like moving averages, stochastic, etc. The associate companies then use a Companies Tab, which enables user to perform fundamental and technical company financial analysis. This module features more than 150 pre-built reports and charts, 20-minute delayed quotes, real time news feeds, as well as interactive price charting. The targeted company here is the Nokia (Nokia Aktiebolag) is likely to retain its customers while capturing those from associate companies, they also came up with a common goal to see if they can improve the market strategies to benefit the involved companies, consumers or society. A study method was used to observe the Nokias’ stock prices so as to foresee the future outcome in terms of profits it will gain. Share Price Reaction on the Date of the Announcement of the Acquirer Company In the year 2013, Nokia managed to employ 90,000 people across 120 countries, conducted sales in over 150 countries and got annual revenues of around €12.7 billion. Later, in September 2013, it again sold the once the world's largest vendor of mobile phones to Microsoft as part of an overall deal totaling €5.44 billion (US$7.17 billion).  This now attracted mergers like Stephen Elope, Nokia's former CEO, and several other executives to join the new Microsoft Mobile subsidiary of Microsoft as part of the deal. Other Companies Also, the Google (Motorola) strived hard to become the ultimate owner, while Microsoft Corporation (Skype) and Berkshire Hathaway (Lubrizol) come to merge, after sitting together and coming up with a common goal to see whether they can improve the market strategies to benefit the involved companies, consumers or society. An event study method was used to observe the company’s stock prices so as to foresee the future outcome in terms of benefits (Schwarz Shea & Yanow 2006). . Share Price Reaction on the Date of the Announcement of the Acquirer Company Acquirer’s stock price changes on the day of M&A announcement 2010–2012 Year Purchaser Purchased Transaction value (in US Dollar rates) 2011 Google Motorola Mobility 9,800,000,000 2011 Microsoft Corporation Skype 8,500,000,000 2011 Berkshire Hathaway Lubrizol 9,220,000,000 2012 Deutsche Telekom Metro PCS 29,000,000,000 By Hitt, Ireland & Hoskisson (2005) Selection of Data and Description Thomson has designed a company Profile, which entails a report written before and is able to load swiftly when one conducts a search through a tracker or identifier, one is able to view a report describing a business from the names, key financials, ratios, news, and earnings forecasts plus revisions for the company of interest. The data is then analyzed in micro-soft excel where the acquires company name is entered in cell in the worksheet, for this case, is Nokia company and sellers names of Suomen Gummitehdas Oy and Suomen Kaapelitehdas Oy in another cell with the amounts of outstanding of the acquirers company in millions and the rest of the target shares in millions also (Johnson 2001). The information is set aside for competitive intelligence, and allows room for strategic planning, identification and evaluation of new opportunities, new product tracking, and for issues related to effective business management practices. An example, Products List of Nokia products Services Maps and navigation, music, messaging and media Software solutions (See services listing) Revenue  €12.70 billion (2013)[2] Operating income  €519 million (2013)[2] Net income  €-615 million (2013)[2] Total assets  €25.19 billion (2013)[2] Total equity  €6.46 billion (2013)[2] Employees 90,981 (2013)[2] Divisions Mapping Services R&D Center Subsidiaries Nokia Networks By Haikio (2002) Hypothesis The merging of companies are giving an assumption that once they get a link with Nokia, there is a high possibility of flourishing and end up with profitable outcomes to either the economy, to all targeted customers and among themselves as shareholders. The listed companies have positive outlook in the market and have previously been major targets to consumers, in that they have made huge profits over the past years but not as huge as that made by Nokia in that year. The strategic management process of merger and acquisition only targets at increasing a firm’s stand to a better position so as to beat any competition arising from other enterprises and their stakeholders an example here is the other cell phone companies. This reflects that, the main motivation in Merger & Acquisition is to help the victim company increase profits and reduce workload after joining with other businesses Nokia Case Study (2008). The hypothesis stands to be challenged. In as much as Nokia has recorded the greatest number of sales, it may not be able to pull the market and this will depend on the strategies the companies will have set. It is not a guarantee that with the set goals, they will impress the market and increase their productivity, because market variation is very high and they are likely to get some differences where each group has its own ideas which they think is the best approach, with these differences, they may end up lagging behind because of the need to accommodate each view. Data Analysis and Methodology This is the preferred methodology used for this type of research as the data is collected from companies that show interest in merging, and then it is analyzed and set ready for presentation. This explains that, the researcher is not involved in actual data collection on the ground and thus not aware of the actual figures but just the presented estimates. This mostly occurs due to time, distance to companies and in turn the method is prone to biasness. Nokia and the associate companies presented their estimated values and what they roughly earned in US Dollars. Researchers did not take time to sit down with any representatives to recalculate so as to obtain first hand information instead they settled with the already documented which supports the view of application of secondary method in research methodology. Presentation of Results This enables monitoring of a profit margin based on previous earnings before calculating interests and removing expenses on tax. This is usually identified when the different companies targeting a common goal list them in the company’s profile tab, and allow mergers do their evaluation before coming together. Thomson banker stated that for mergers to come together, and become successful, there is need to undertake proper scrutiny through benchmarking where, companies select from the already presented graphs those which match their criteria’s, after a careful analysis of the previous trends. This helps explain whether a company is making any progress and gives room to merge with another because it is seen to be picking up and can attract more customers, in exchange or profits. Also, an interactive price chart helps explain more on data presentation in that, some features of Thomson ONE Banker allow users to customize a chart, by detecting a benchmark index or another stock price line, in a given time period, and select a technical analysis tool like moving averages, stochastic, among others. The associate companies then use a Companies Tab, which enables user to perform fundamental and technical company financial analysis. This module features more than 150 pre-built reports and charts, 20-minute delayed quotes, real time news feeds, as well as interactive price charting. The digital system allow all stakeholders view and get a breast with the current situation on the ground as in which company sells highest, what strategies it uses and then they convene a meeting to generate new ideas and be able to attract a large market, if also they will improve economy if their targeted customers will get satisfied with services that will be provided by Nokia. Also, Becker & Lazaric (2009) stated the need for efficiency Ratios that are used to measure how effective management can be. This rule from the types of decisions made. like when the merged companies set a target that so that they will meet and evaluate whether the set goals in terms of providing quality services, meeting customer demands and raising the market value in terms of economy will either have been met or not. The ideas should be put in practice and be achievable, and give room for evaluation after evidence is given by the society that indeed, Nokia has all what it takes to satisfy its customers’ needs Johnson (2001). Solvency Ratios will help mergers know whether the acquirer company has the ability to raise its own capital and pay the required debts. In practice, bankers usually include leverage ratios as debt covenants in contract agreements. Also, the merged companies need to set a limit where in case the business fails to peek as per their expectations because it is not a guarantee, some amount of money is set aside to pay debts in terms of loans borrowed and services it has received from all stakeholders. Rather, this means that, before announcing any final results, the companies should have in mind the basic ratios where the merged companies need to set limits in case the business fails to peek as per their expectations, some amount of money is set aside to pay debts in terms of loans borrowed and services it has received from all stakeholders. This may happen because of market variations that will depend on what kind of services is offered. In as much as the company had the greatest shares in the market, it should be in a position to retain its customers and attract those customers from the associate mergers side and use the services provided to make huge profits. At the end of it all, it will be considered wise to evaluate the impacts in terms of benefit that Nokia together with its mergers have presented to the society. This should be evidenced and measurable and will explain a profit margin that is taken to be the best consideration when it comes to business, and applies when the already listed earnings of various companies are put to record as they work towards achieving their set goals which at the end, they will sit down and see whether they were able to attract a large market, if the economy has improved and if the customers are satisfied with services provided by the new Nokia services. After merging, Microsoft acquired the Asha and Lumia brands to 31 December 2015,this explains that Nokia came up with better phones for its customers after focusing on three core business units in mapping service that Microsoft will license for four years under the deal, its infrastructure division  on Nokia Solutions and Networks and on developing as well as licencing it. This has enabled Nokia to acquire other companies. From the set hypothesis, the associate companies to Nokia showed a high rate of transaction, it is likely to be assumed that they will appoint Nokia to be the acquirer company and together they will attract huge markets and provide quality services to their customers. This may be a true hypothesis but can also turn to be false. For the companies to thrive to successful levels, its upon them to look for sufficient time to hold meetings and do careful evaluations of all strategies they have so as to work in one direction. Before making any final results, the companies should put into consideration the basic ratios and look into whether the set objectives can be met in order to ensure they are in the right track. An example comes in when merged companies need to set limits where in case the business fail to meet the goals as per their expectations, some amount of money is set aside to pay debts in terms of loans borrowed and services it will have received from all stakeholders. This may happen because of market variations that will depend on the kind of services that are offered Mackenzie (2012). It is also wise to evaluate the benefits that Nokia together with its mergers have presented to the society. This explains profit margin and is taken to be the best consideration when it comes to business, and applies when the already listed earnings of various companies are put to record as they work towards achieving their set goals which at the end, they will sit down and see whether they were able to attract a large market, if the economy has improved and if the customers are satisfied with services provided by Nokia. The merged companies should establish attractive markets to the customers and use the services provided to make profits. An example, is when the merged companies set a target that, by the end of two quarter, they are likely to evaluate whether the set goals are met or not in terms of providing quality services, meeting customer demands and raising the market value in terms of economy. If not, this give room for re planning and they decide on new measures where ideas come from customers, stakeholders themselves or ideas which their competitive companies are using. Conclusion The whole discussion on empirical research, each type of business is usually started with an aim of making profits and the need to provide quality services and products to customers. For the information to be termed as empirical it must be analyzed in form of numbers (quantitative) this refers to the profits gained in the finance sector or word (qualitative), in terms of quality services provided, good market catchment that is seen or acquired through observation, experience or experimentation, and later give a scientific backup for evidenced based practice. He hypothesis selected is also tested, since Nokia has the highest selling rates, this does not guarantee that it will attract huge profits once it merges with its associates and so before deciding on the need for merging with other associates, they are usually in a position to capture their internal market, set and achieve their set standards and make unremarkable profits, that in cases of any short comings, they are able to settle any debts and recover losses. After this, if they see the need for mergers and acquisition (M&A) they can present their data in the company’s profile for careful analysis before deciding on the type of company to merge with and in turn use to complement the external need once the internal are strengthened throughout the project Becker & Lazaric (2009). Mergers if used well, and work in line with the set objectives, help most companies regain their profits. The idea for mergers is that any types of businesses joining together should be able to pool resources together and improve on their previous status. If they fail, then, they are subject to collapse and heavy debts from banks, stakeholders and lose of customers, which in turn give room for competitors to rise over again. There is need to work with seriousness and device methods that help improve work performance, since merging is done, there is likely to be reduced human resources and increased financial status to allocate sufficient resources and provide adequate services. Workers need to have set targets and those which should be measured with an appraisal tool which will help them know if any progresses or regressions are made. Bibliography BELSKY, E. S., HERBERT, C. E., & MOLINSKY, J. H. (2014). Homeownership built to last: balancing access, affordability, and risk after the housing crisis. http://public.eblib.com/EBLPublic/PublicView.do?ptiID=433337. (2008). Nokia Case Study: How can Nokia maintain its market position in the mature European market? München, GRIN Verlag GmbH. http://nbn-resolving.de/urn:nbn:de:101:1-20100825850. HÄIKIÖ, M. (2002). Nokia: the inside story. London, Pearson Education. BECKER, M. C., & LAZARIC, N. (2009). Organizational routines advancing empirical research. 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