- Nokia is focused on four fundamental objectives: maintaining its leadership in radio, growing professional services capabilities, winning with innovative telco cloud and SDN solutions, and extending its presence into the Internet of Things. Quality, innovation, partnering and automation are the drivers it will leverage in order to meet these objectives.
- Nokia’s three business areas – Nokia Networks, HERE and Nokia Technologies – are aligned under a mantra of technological competencies, innovation capabilities, software strengths, its strong brand, trust, a lean operating model and intellectual property. The new Nokia has aligned these three areas under a common model which stresses operational excellence.
Nokia held its annual industry analyst conference on December 2-3, 2014 in Boston, which has been the customary venue for the past four years. This year, there was an undeniable feeling of optimism and confidence that topped prior years’ events. This was perhaps due with the feeling that the company has put the challenges of restructuring and uncertainty behind it and now has a solid, executable plan to take the next step in the progression of the new Nokia (which is less than a year old).
The conference was opened by Rajeev Suri, President and Chief Executive Officer, who outlined with clarity where the company would spend its resources, how it would innovate and where its current and future strengths would lie. His presentation included the typical high-level financial performance metrics expected from the top executive, but took a turn into the key aspects of the new company that Suri sees as differentiating Nokia from the rest of the companies competing for telco dollars. Several areas caught our attention:
- Radio Leadership – Maintaining a leadership position in radio was a given, and was reinforced in other presentations with examples of how its investments in 5G and small cells would support emerging network needs as well as support innovative multi-technology radio solutions in the future.
- Partners – As noted by Mr. Suri in prior meetings, Nokia’s partner model is not only a way to fill portfolio gaps, but also an integral component of its innovation strategy. Several new partners were introduced at the conference that add to the capabilities of an end-to-end Nokia solution. Innovations that drive network efficiency, agility and differentiation are integrated under multiple business models to provide operators with the ability to offer new services and features.
- Operational Excellence – The company has focused on delivering software that has zero defects, a goal often touted, but not too often achieved. This claim was backed up later in the program by stats from the head of development, stating that 90% of the R&D staff is certified on Six Sigma and has improved its efficiency by 20% in the process.
- Connected Car – Although this application has been discussed by multiple vendors, Nokia leverages its HERE portfolio to deliver location-based information to facilitate the next round of automotive connectivity. This was backed up by a large stable of auto manufacturers that are integrating HERE’s mapping technology into their navigation systems.
- Telco Cloud – The company has been actively engaged with its customers in developing telco cloud solutions, almost in stealth mode compared to some of its competitors. What came through its multiple discussions was the number and types of projects in which the team was engaged with major operators. This initiative also leveraged the company’s efforts in promoting and utilizing emerging standard solutions (such as orchestration based on VMware and OpenStack) as well as submissions to the ETSI and other standards groups.
The story from Nokia addressed the major industry challenges, and did so in a way that placed the vendor’s strengths at the forefront of its plans. However, as noted in a previous Advisory Report covering Alcatel-Lucent and Ericsson’s analyst conferences, the momentum of the market is forcing the largest vendors to tell somewhat similar stories focused on the cloud, verticals, etc. To this end, the thing(s) that will separate Nokia from its competitors will be its ability to continue to innovate, leverage its partner ecosystem and deliver compelling solutions to its customers.
In other words, it all comes down to execution.