Internal and External Strategies and Policies of Nokia Inc and Samsung Group - Essay Example

BUSINESS STRATEGY Taking forward the strategic analysis of the Nokia Inc in this section we attempt to point out the weaknesses in the structure of Nokia Inc. We do this by comparing the strategies and market policies of the organizations with that of its leading competitor. We compare the internal and external strategies and policies of the Nokia Inc with that of Samsung Group, which is one of the largest organizations in the marketing of the mobile products. The Samsung group has been posing great threat to the markets of Nokia specially in the developing and the underdeveloped nations of the world. Nokia was the most popular brand of mobile phones in these markets till the last decade, however with the advent of the Samsung group and its innovative products the market has been divided. Nokia faces a tough competition from the Samsung group especially in the mobile phone sector. In this analysis we try and compare the roles and responsibilities for strategy implementation in Nokia Inc and Samsung Group. The paper will try to identify and evaluate resources required to implement a strategy in the Nokia Inc. further it would also analyze whether the Nokia Inc is sufficiently equipped with resources so as to deal with the much required changes. Analysis The Samsung Group of companies is a Korean multinational organization with its headquarters in Seoul. It is one of the world’s largest mobile companies with annual revenue of 173.4 billion dollars. This organization has invested in a variety of businesses including heavy industries, ship industry and life insurance. However the mobile business remains its largest domain. “As a global leader we are at the forefront of change, anticipating today what our customers around the world will want tomorrow.” (Samsung Profile, 2009). Nokia being the market leader is the toughest competitor of the Samsung group in the mobile business. Nokia is a large organization with enough resources to spend on the reseach and development of the new technologies and innovations. At the same time Samsung group challenges Nokia Inc by bringing in phones which are attractive to the customers in terms of price and features. Nokia has wide established market and customers for mobile phones. It is a renowned firm for its user friendly products. Samsung on the other hand is a new dealer, as compared to Nokia, in the field of telecommunication. Still the firm has captured a considerable market and is providing tough competetion to the Nokia Inc. the strength of the Samsung group is that it adopts different strategies for different countries. Samsung group has different plans and marketing startegies for countries like India and China at the same time it operates with a different plan in the developed nations like United States of America and United Kingdom. (Chul, November 2003). The organization has undertaken regional trade expansion pojects as an urgent requirement. The organization undertook operations to cooperate with the regional entrepreneurs for market expansion. “Cooperation between Korean and Japanese entrepreneurs is important.” (Chul, November 2003). To enchance the competitiveness of firm, the management strived at devoping technologies and improving qualities of the manufacturted products. The company even restructured the businesses by making it more quality oriented. Samsung group of companies have a strategy of huge investments in the organizational structure related to Human resources and product design, the Nokia Inc on the contrary spends huge amounts on innovations and product development. Nokia needs to understand the market requirements on spending on the employee an dcustomer relationship to bring out the best of internal and external atmospheres. The Samsung group works closely to understand the consumer and his demands. It works with a different strategy in every country, understands the emotions of the customers and thus provides them with products according to their needs. Nokia fails in this context as it strategies and plans centrally thus fails to understand the demands of the people and further fails to provide products accordingly. This can be proved with the following example, the touch screen phones are in vogue all over the world, especially in the third world countries. Samsung group has understood the pulse of the customers thus providing them with the touch screen phones at half the price which Nokia provides. This has lead to the rapid expansion of the products introduced by the Samsung group leaving Nokia Inc far behind in the rat race of sale of mobile phones in the third world countries. (Chul, November 2003). Nokia Inc had redefined the usage and marketing of the mobile phones. It is huge corporate brand which has a brand value in the market. This brand value provides the competitive edge to the Nokia Inc. this firm has lend a personality to its products which is very difficult to folllow or ape. “Nokia has products ranging from equipment, solutions and services that also cater to network operators and corporations.” (Cuizon, April 2008). However this huge firm, the numero uno firm in the mobile manufacturers faces certain problems. The firm has a lapse in its marketing and distribution policies which has lead to the emergence and growth of the small competitors. The organization needs to understand the basic needs of the customers worldwide, with the standardization of the products it also needs to invest in the decentralization of the strategic plans. The company can work toards building a worldwide supplier network just as the Samsung Group to minimize the costs and increase the consumer service and satisfaction. Nokia is a huge firm with the capacity to invest and develop its markets. The organization believes that efficient research and development is critical to remain competitive in the ever-expanding communications industry. “As of April 1, 2007, we had R&D centers in 11 countries and employed 14,500 people in research and development, representing approximately 32% of Nokia’s total workforce.” (Research, 2010). The Nokia Inc had established a research centre in the year 1986, completely dedicated to development of new strategies and innovations. This centre works to provide breakthroughs in the existing business and to provide a visionary. Recommendations Nokia has been one of the top performing companies in the telecommunications sector. It has been able to serve the needs of people all over the world. The company has been able to do so by investing heavily in the research and development programs. However, it has not been successful in creating an artificial barrier of entry for the other companies in the industry. The other companies like Samsung have been able to penetrate into the market with ease. The companies have invested heavily in the marketing and the advertising of the products. Moreover, the companies have been able to gauge the mentality and the behavior of the customers in different countries. Nokia should take a lesson form this and should engage in an exercise of understanding the customer behavior. Innovation is necessary but it should pertain to the needs of the customers. The company should also engage in various marketing activities to make the customers aware of the products. This will help them to increase the turnover of the company and face any kind of competition. The company has the advantage of the brand value that would help them to attract the eyes of the customers. References 1. Chul S. l. (November 26, 2003). The management strategy of Samsung in East Asia. Samsung corporation. Available at: http://www.jetro.go.jp/en/reports/survey/epa/sympo0311/s1-3p.pdf (Accessed on June 17, 2010) 2. Cuizon G. (april 22, 2008). Nokia. Bizcovering. Available at; http://bizcovering.com/major-companies/nokia/ (Accessed on June 17, 2010) 3. Research. (2010). Nokia.com. Available at; http://www.nokia.com/about-nokia/research/research (Accessed on June 17, 2010). 4. Samsung Profile (2009). Samsung.com. Available at: http://www.samsung.com/us/aboutsamsung/corporateprofile/ourperformance/samsungprofile.html (Accessed on June 17, 2010). Read More