Business History of Nokia
Nokia is a Finnish company that since 1995 has become a global leader in the production of cellular phone.
Traditional images of Finnish industry are associated with timber forest products, furniture, ships and Valco (a government television picture tube company). The importance of the forest industry was evident in the slogan Nokia used during 70s, “Finland lives from its forest”.
Nokia is an old Finnish industry; it origin are traced to 1865 when an engineer named Fredrik Idestam built a pulp mill on a river in southwest Finland to produce paper. A small town eventually grew up around this mill site, and a company formed and achieved success in the production of paper and cardboard products.
In 1966 Nokia entered the electronics field. Initially it employed only 460 people and it was the country’s fourth largest employer in electronics. 1966 was also the year that Nokia’s three industries – forest products, rubber, and cable – merged. Thus when Nokia entered the production of consumer electronics and later, mobile phone, it was already a familiar industrial name to Finns.
Nokia was involved in eleven different industrial fields during the 1980, and difficult for foreign investors to understand the corporation. Nokia’s entry into high technology field began in the 1980s, when the CEO Kari Kairamo took the helm. He favored an active foreign policy for Finland, and as early as 1987 supported the country’s entry into European Union.
During the 1970s and 1980s, Nokia pursued an active acquisition policy and sought a refashion itself in several ways. The company’s strategy sought to develop a corporate structure modeled after General Electric. One of these was the purchase of Luxor, television maker.
Telecommunications has always been a strong industry in Scandinavia. Nokia’s particular success came as it acquired the technology for producing cellular phones from a joint venture that it initiated. International success finally came in 1984, when the Mobira Talkman, a portable cellular phone, came on the market and captured attention as a result of its innovativeness.
In 1992, Nokia decided on a new radical strategy. Nokia would become a mobile-phone pure play and sell off all other nonmobile phone assets, Nokia’s core business would henceforth be technology, not paper products, and not even computer or television technologies. This decision came as Nokia launched its 2100 series GSM cell phone, which was an incredible success. Nokia manufactured and sold 20 million.
Business History of Nokia
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