HUMAN RESOURCE STRATEGY REPORT: NOKIA

A company’s success is founded on proper human resource management
strategies. A company must seek to ensure that it moves in a strategic direction by
having the right kind of employees for the right job. Human resource strategies must be
aligned with the needs of the organization as well as the objectives of the organization.
Human resource management also involves the collection of data to define
which strategies can contribute towards organizational effectiveness. The mobile phone
industry is highly competitive, with players facing competition from technology giants
such as Apple and Samsung. Nokia Corporation is a player that needs to embrace
proper human resource strategies to compete favorably with other players in
the market.
Description of the Organization
Nokia is is a technology company that mainly focuses on the production of mobile
phones. The company’s mission is to help the world work together through the provision
of technology services and tools. The company is engaged in strategic partnerships that
seek to come with solutions that will deal with global issues (Aspara et al., 2013). The
company also aims to ensure that it creates solutions that respond to issues such as
climate change. The company embraces recycling and works on reusing certain
components instead of disposing of the components and, in so doing, polluting the
environment. Nokia’s vision is connecting people (Nokia Corporation, 2021). The
company aims to produce mobile phones that create human connections and solutions
that create a productive and more sustainable world.
Nokia has a hierarchical organizational structure. The organization embraces a
chain of command. The chain of command originates from the management to general
employees. The organization is structured on multiple levels. The management holds
the highest power, and the company has a pyramid-shaped organizational structure.
Every department has a supervisor, and employees report to the supervisor (Vuori &
Huy, 2016). The company has four main departments. Every department has to ensure
that it carries out its core mandate. The company’s departments are mobile phones,
enterprise solutions, multimedia and networks. Each department has its set of
obligations and responsibilities and must contribute to Nokia’s overall mission and
vision. Nokia sells its products worldwide. In the year 2008, the company commanded
38.8 percent of the global mobile phones market (Vuori & Huy, 2016). The company’s
headquarters are located in Finland. The company was founded in 1865 and has
continued to grow over the years. It is estimated that the company has employed over
90,000 employees spread across different countries in the world. Its annual revenues
are over 20 million dollars every year(Vuori & Huy, 2016). Nokia is traded both in
Helsinki Stock Exchange as well as the New York Stock Exchange.
SWOT Analysis
Nokia has been facing various challenges relating to the adaptation to the current
market. The company enjoyed success in the past, and this is the main strength of the
company. The company has had a huge experience in the technology industry. The
company was a world leader in the 1990s and 2000s (Vuori & Huy, 2016). Another
strength is the fact that it has a large pool of resources. The company can invest in
various projects and ensure that it becomes successful in its quest for innovation. The

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main weakness of the company stems from its poor financial performance. In the recent
past, the company has been experiencing a run of poor financial performance. It has
been facing stiff competition from major players such as Apple and Samsung. The
company’s opportunities include the ability to venture into new markets as well as
leveraging on its brand name to gain command in the market. The stiff competition from
other players also doubles up as the company’s main threat (Vuori & Huy, 2016).
Players from China have also joined the mobile phone market, and this means that the
company must come up with a strategy to gain a competitive advantage over its rivals.

Strategic Planning Process
Description of the Organization’s Strategic Planning Process
The company adopted a new strategy in 2018 (Lindén, 2021). The new strategy
seeks to ensure that the company keeps up with the recent trends in the mobile phone
sector. The company seeks to accelerate innovation and build on becoming a leader in
technology. The company seeks to ensure that its partnerships with other players in the
market help create a platform for innovation. The company also seeks to ensure that it
becomes customer-centric. Changes in the mobile phone and telecommunications
industry demand that a company concentrates on the experience of the consumers
(Lindén, 2021). The company aims at giving unique customer offerings and ensure that
the products are aligned with the needs of the consumers. Nokia plans on investing
heavily in innovation and, in so doing, coming up with a winning strategy.
Description of HRM strategic planning process
Nokia cares about consumers as well as employees. The company has thus
chosen to have a sustainable work environment where individuals can grow their
careers(Vuori & Huy, 2016). The company’s human resource management strategy has
been to create an environment of respect, achievement, renewal, and challenges.
Respect is the company’s commitment to treat every employee with the required
dignity(Vuori & Huy, 2016). The company also seeks to have employees work as a
team and, in so doing, create a winning formula in the marketplace. The company is
committed to embracing new strategies by investing in the renewal of the skills of
employees. Nokia has adopted a policy of observing ethics and integrity in the conduct
of business. Nokia supports an open dialogue with employees and seeks to ensure that
they are adequately recognized and rewarded for their efforts. The human resource
department is tasked with overseeing the implementation. The company has an HR
selection panel that is involved in the recruitment of new employees. The HR
department also works towards coaching and mentoring employees. In addition, Nokia
embraces performance appraisal that ensures that employees are compensated for
their performance. Equity programs are given to eligible employees.
Analysis of Alignment Strategies
The company is facing challenges aligning its HR practices with the goal of
becoming innovative and gaining a competitive advantage over other players in the
market. Its hierarchical organizational structure has created different levels of authority
in the organization. The decision making is thus formal, and employees must consult
with their superiors before making decisions. Organizations that are innovative are
rooted in agility (Vuori & Huy, 2016). Bureaucracy may hinder the company from coming
up with innovative practices that suit the technology market. Individuals in the
organizations need to be given decision-making abilities and, in so doing, ensuring that

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they are able to respond to the needs of consumers. Employees must feel like they are
part of the organization for the company to thrive.
Innovation requires employees to work closely and information to be shared
between various organizational groups. The top management needs to work closely
with other employees in order to develop actionable goals (Waruwu et al., 2020).
Progress can only be achieved if a company aligns its human resource strategy with its
strategic goals. Nokia has failed in this sector, and this has resulted in the company
lagging behind other technology giants such as Samsung and Apple. The organizational
structure instils fear in employees and prevents employees from making innovative
contributions that could help change the fortunes of the company. The
departmentalization of the organization further inhibits information flow, and this
prevents the collaboration of various departments in guaranteeing innovative products.
Alternative Strategies
The company needs to embrace diversity. Diversity will help ensure that Nokia
becomes innovative. The company also needs to streamline its hiring practices. An
innovative company is one that hires the best talent in the market. Nokia needs to
ensure that it rebrands and uses employee referrals to ensure that it hires the best
employees. In addition, the company needs to come up with retention strategies. Hiring
new employees is costly, and this may result in the company spending too much on
employee training and onboarding (Stewart & Brown, 2020). A company that retains
employees minimizes the costs and ensures that it remains competitive as well. Nokia
should learn from the success of Apple and seek to adopt an HR strategy that
embraces innovation. The company also need to restructure and, in so doing, ensure
that it promotes innovation.

Recommendations

Nokia has currently embraced a traditional hierarchical organizational structure
that could be an impediment to innovation. Nokia’s hierarchical organizational structure
creates fear of making bold decisions. Middle-level managers, as well as top level
managers, experience both external and internal fear (Vuori & Huy, 2016). The
company has focused too much on external threats and failed to concentrate on its core
competencies. Internal fear stems from the fact that employees have to ensure that they
make decisions that are approved by senior members of the management. Both internal
and external fear generate structurally based fear. Structurally based fear is likely to
interfere with proper decision making and is likely to stifle innovation. Nokia currently
uses time-pacing that creates a sense of urgency in the completion of various projects.
The company needs to adopt a healthier way of managing employees. The focus
should be on the completion of the projects as opposed to completing them on time.
The company thus needs to ensure that it adopts a different organizational
structure that will the company remain innovative and compete favorably with giants like
Apple and Samsung. While the company can retain its hierarchical structure, it needs to
have a hybrid organizational structure. Introducing a functional organizational structure
can help stimulate growth. Workers should be grouped based on their skills and
knowledge (Vuori & Huy, 2016). Each department should have the power to make
critical decisions. Information sharing between different functional structures should be
made possible. Currently, managers rely on their status in the organization. (Vuori &
Huy, 2016) Junior employees at Nokia may feel intimidated by the management, and

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this may have an adverse impact on their productivity. All employees need to be
involved in decision making, and they need to feel a sense of belonging that is not
attached to their positions at Nokia.

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References

Aspara, J., Lamberg, J. A., Laukia, A., & Tikkanen, H. (2013). Corporate business
model transformation and inter-organizational cognition: The case of Nokia. Long
Range Planning, 46(6), 459-474.
Bouwman, H., Carlsson, C., Carlsson, J., Nikou, S., Sell, A., & Walden, P. (2014). How
Nokia failed to nail the Smartphone market.
Lindén, C. G. (2021). Kingdom of Nokia: How a Nation Served the Needs of One
Company.
Stewart, G. L., & Brown, K. G. (2020). Human resource management (4th ed.). Wiley.
Vuori, T. O., & Huy, Q. N. (2016). Distributed attention and shared emotions in the
innovation process: How Nokia lost the smartphone battle. Administrative Science
Quarterly, 61(1), 9-51.
Waruwu, H., Asbari, M., Purwanto, A., Nugroho, Y. A., Fikri, M. A. A., Fauji, A., … &
Dewi, W. R. (2020). The Role of Transformational Leadership, Organizational
Learning and Structure on Innovation Capacity: Evidence from Indonesia Private
Schools. EduPsyCouns: Journal of Education, Psychology and Counseling, 2(1),
378-397.