Nokia today announced a number of changes “aimed at sharpening its strategy, improving its operating model and returning the company to profitable growth.” Among the changes are the cut of 10,000 jobs globally by the end of 2013, changes to the leadership team, corporate realignments, and consolidation of manufacturing operations.
“We are increasing our focus on the products and services that our consumers value most while continuing to invest in the innovation that has always defined Nokia,” said Stephen Elop, Nokia president and CEO. “We intend to pursue an even more focused effort on Lumia, continued innovation around our feature phones, while placing increased emphasis on our location-based services. However, we must re-shape our operating model and ensure that we create a structure that can support our competitive ambitions.”
Nokia outlined three areas that it will focus on going forward:
- Products and experiences that make Lumia smartphones stand out and available to more consumers
- Location-based services both on Nokia products and new industries
- Competitiveness improvements for its feature phone business
The job cuts will take place in many areas. Some R&D projects will be cut along with facilities in Canada and Germany. Manufacturing facilities in Finland will be closed. IT, corporate and support functions will be streamlined as well. Nokia could also sell of non-core assets.
It has also announced some changes to its leadership team. Juha Putkiranta as appointed executive vice president of Operations; Timo Toikkanen as executive vice president of Mobile Phones; Chris Weber as executive vice president of Sales and Marketing; Tuula Rytila as senior vice president of Marketing and Chief Marketing Officer; and Susan Sheehan as senior vice president of Communications. Putkiranta, Toikkanen and Weber will join the Nokia Leadership Team effective July 1st, 2012. Jerri DeVard, Mary McDowell, and Niklas Savander will all step down from the Leadership Team effective June 30th, 2012.
Nokia’s transition to Windows Phone continues to prove challenging. Along with these changes, it also announced a lowered outlook for its third quarter. It blamed “competitive industry dynamics” that will result in “non-IFRS Devices & Services operating margin in the second quarter 2012 to be below the first quarter 2012 level.”
Nokia is not out of the woods yet…
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