Essay On Nokia

782 Words2 Pages

Overview
Nokia Corporation is a leading mobile communications company, which provides telecommunications hardware, software and professional services (Nokia, 2014). There are three businesses, including Devices & Services, HERE (formerly Location & Commerce) and Nokia Siemens Networks, and four operational and reportable divisions, including Smart Devices and Mobile Phones within the Devices & Services business (HERE) and Nokia Siemens Networks (Nokia Siemens Networks, 2012). Nokia’s main activities include technology research, product development, product management, sales and marketing, production of 1. Mobile devices 2. Map and location-based services 3. Infrastructure equipment and products, and strategic sourcing and partnering (Nokia Siemens Networks, 2012).

Other activity areas involve strategy that leads to sustainability for the people and the environment e.g. implementing sustainable and ethical working practices, minimising greenhouse gas emission, developing services that reduce unnecessary travel, and enhancing energy efficiency in products and technologies that use renewable energy (Nokia, 2014).

Risk Factors
As mentioned above, Nokia comprises of different businesses and activities; therefore, there are different areas in the company that are sensitive to physical, financial, and reputational risks. These risks are identified in terms of strategic, tactical, operational, and economic risks. Its overall risks, which arise from the main activities, are summarised below:

Strategic Risks (External)
Information Technology industry has a rapid changing environment e.g. rapid expansion of device functionality (Mizoguchi, 2012). Consequently, if Nokia’s top management could not adapt their business/ operations and increa...

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...s carrier-related operations have criminal and governmental issues i.e. employees of Siemens were accused of being unlawful; therefore, affecting Nokia’s reputation and operations (Nokia Siemens Networks, 2012). Lastly, Nokia brand is subject to reputational risk due to their sluggishness in operations in 2012 (Balakrishnan, 2012).

Economic Risks
Euro is Nokia’s reporting currency; therefore, the dissolution of the euro could increase the costs and volatility in Nokia’s reports of operations and financial condition (Nokia Siemens Networks, 2012). Moreover, since Nokia operates in a vast number of emerging countries, they are subject to economic, regulatory, political, and uncertainties risks, including sudden devaluation of currency, tax issues, challenges in repatriation of cash, and regulations against imports, from those countries (Nokia Siemens Networks, 2012).

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