Nokia's Planned Decision to Cut 4,000 jobs is Not Breaking News
An anticipated announcement by the Helsinki-based Finnish electronic giant to cut 4,000 additional jobs at its manufacturing plants in Finland, Hungary and Mexico was not taken as the ‘Breaking or Shocking News'.
Though the 8% cut in the workforce – to be taken in phases through this year – would result in total jobs loss of 30,000, it was a strategic decision made by Stephen Elop, the Chief Executive Officer since September 2010 and was expected since the closure of Romania based plant in September 2011.
Nokia faced a steep fall in its financial strength during last year:
- Nokia closed the Year 2011 with a little higher than €10 billion ($13.1 billion) in net sales – remarkably 21 percent lower than those of Year 2010.
- At the same time, Nokia faced 20% drop in the net cash and liquid assets (€1.4 billion) during the Year 2011.
- Similarly, on the board, NOK could not perform better as continuously falling stock curve closed today (Wednesday 11:34 AM PDT) at 5.22 as compared to the 10.9 closing figure of February 10, 2011.
- A report by NPD appeared in Media in December 2011 about the falling Symbian share in the US OS market which fell from 9% in 2006 to merely 1% in October 2011.
A simple analysis of the affairs may, easily, identify few of the following strategic mistakes which may lead any successful company to the similar state of affairs as that of Nokia:
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