Everyone is familiar with Dell's supply chain, and everyone agrees that Dell's success is directly related to its supply chain operation mode. But not many people are familiar with Nokia's supply chain，In fact, Nokia has long dominated the global mobile phone market, largely due to its supply chain. This paper makes a comprehensive, systematic and dynamic study to demonstrate of Nokia supply chain. Based on the supply chain theory, we analyze the company’s overall competitive advantage and competitive strategy. Besides, we also study the Nokia supply chain from a dynamic and evolutionary perspective. According to the supply chain process, this paper comprehensively describes the Nokia’s supply chain, from the practical stage and strategy module, such as purchasing strategy, manufacturing strategy, channel strategy, customer service strategy.
After studying the supply chain management strategy, this paper also makes a brief analysis of the problems in Nokia supply chain management. According to the research results of Nokia supply chain management strategy, corresponding suggestions and improvement methods are proposed.
Since the 1990s, logistics and supply chain research has been very popular in both academic and business circles. Many famous concepts and theories are put forward, and many classic excellent supply chain practice cases are also explored. However, everyone is familiar with dell's supply chain, and everyone agrees that dell's success is directly related to its supply chain operation mode. But few are familiar with Nokia's supply chain. Most of the studies have been limited to a few known earlier cases, like Beijing "star garden model" and so on, comprehensive、systematic and dynamic research on Nokia supply chain is still relatively few. This paper tries to make some efforts to enrich the supply chain and its management theory.
Based on the development of the mobile communication industry and Based on the supply chain and its management theory, taking Nokia's supply chain as the research object, this paper attempts to study Nokia supply chain strategy and its evolution in theory and practice comprehensively, systematically, empirically and dynamically (Christopher, 2016). First of all, comprehensive analysis refers to the supply chain process, as far as possible comprehensive description of Nokia's supply chain. Secondly, system analysis is based on the competitive advantage theory and supply chain theory. Analyze the overall competitive advantage and competitive strategy of the company, and study the business strategy transformation of the company in different development periods. Third, apply more empirical evidence. This paper tries not to limit itself to a few earlier cases that are already known, but to study Nokia's supply chain with more empirical studies in different periods. Finally, dynamic means that the supply chain is not fixed. We should constantly explore and summarize our experience, find out our shortcomings, and timely learn more successful supply chain cases to make up for our shortcomings.
2. Nokia background
Nokia Corporation is a multinational company headquartered in espoo, Finland, specializing in the production and related services of mobile communication devices. Nokia was founded in 1865, mainly engaged in logging and papermaking, and gradually expanded into the fields of rubber shoes, tires and cables. Later, it developed into a mobile phone manufacturer, focusing on the research, development and authorization of basic communication services and advanced technologies (Nokia Corporation , 2018).
On February 11, 2011, Nokia and Microsoft reached a global strategic alliance and deeply cooperated to develop the Windows Phone operating system. Faced with the rise of smartphones with new operating systems, Nokia's position as the world's largest mobile phone seller was surpassed by samsung in the first quarter of 2012, ending 14 years of market dominance. On September 3, 2013, Microsoft announced that it would acquire Nokia's devices and services division for 5.44 billion euros and obtain the relevant patents and brand authorization. In the future, Nokia will strive to develop Here map services, solutions and networks (NSN) and three pillar businesses of leading technology. On April 25, 2014, Nokia announced the completion of the mobile phone business transaction with Microsoft and the sale of the device and service business to Microsoft. On November 18, 2014, Nokia officially released the first Android tablets, after Nokia will be committed to the mobile network infrastructure, software and services, surveying and mapping navigation and intelligent positioning, advanced technology research and development and authorization. On November 18, 2015, Nokia officially launched its $16.6 billion acquisition of alcatel-lucent. On May 18, 2016, Nokia brand was authorized to be manufactured by HMD and fuzhikang under honghai group. Nokia's progress has been inextricably linked to its sound supply chain management strategy.
3. Nokia supply chain strategy and its evolution
Based on the supply chain theory, especially the analysis framework of supply chain strategy, focusing on Nokia's supply chain strategy practice and its evolution, Analyze how they contribute to the competitive advantage of enterprises in cost reduction and service enhancement. First, analysis from Nokia's supply chain practice in different periods in general and modularize the supply chain strategy. Then each strategy module is analyzed and discussed in detail.
3.1 Nokia supply chain evolution and strategy module
In the context of economic and technological development, Along with the development of enterprises, the supply chain practice of any enterprise is a process from primary to advanced, from partial to whole, from imperfect to mature (Handfield, 1999). Although the process is complex and often crisscrossed, in view of the general principles of organizational design and business management of enterprises, the construction and management of supply chain usually implement modularization, overall division of labor (Chopra, 2015). Nokia supply chain practice can be divided into four stages with the development of enterprises. That is, focusing on functional stage, internal integration stage, external integration stage and end-to-end integration stage. According to the supply chain process, Nokia's supply chain strategy module can be divided into procurement strategy, manufacture strategy, channel strategy, customer service strategy, and end-to-end supply chain structure, supply and demand plan and information management.
Stage 1: focus on functions. The functional departments of enterprises focus on improving their own processes and improving resource utilization. The department manager usually focuses on the cost and functional performance of the department. The process of cross-functional departments is not well understood, which limits the operation efficiency of complex supply chain processes. Obviously, it is not enough to focus on local performance optimization. Long-term accumulation will lead to big problems. Nokia's 1995 operating crisis has to do with the failure to address supply and demand globally and collectively.
Stage 2：Internal integration. The enterprise has defined the process and overall process of the cross-business department so that each functional department can clearly understand its role in the complex supply chain process. After the operation crisis in 1995, Nokia began to plan and reform its supply chain system from 1996 on a global scale, and took supply chain management as an important strategic measure.