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ign allows Nokia to use the same production line for multiple products and enables them to react quickly to changes in demand by shifting from one model to another RD Alliances/partnerships provide a large portion of Nokia capabilities Nokia has developed a strong capability platform in the .。 primarily driven by alliances and partnerships. CAPABILITY PLATFORM 22 BRAND DEVELOPMENT Starting in 1994, Nokia increased corporate brand awareness through vigorous advertising campaigns. Source: Annual reports。 press releases。 press clippings。 pany web site Crea t ing pu llt hrou gh buildingbrand a wa r e ne s s? Ea r ly ad o p tio n o f co n sum e r b r a n d a d vertisi n g rat h e r t h a nte chn o log y fo cus? St r a te g ic TV a d vertisi n g (e. g . , th r o u g h CN N to re a ch b u sin e ss p e o p le,th r o u g h NBC S u p e r cha n n e l a n d MT V t o re a ch y o u n g e r s e g m e n ts wh oto o k t o t h e c o n ve n ien ce a n d styl e o f t h e p r o d u cts)? Ag g r e ssiv e a d v e r tising in p r int m e d ia (e. g ., Bu sine ss W e e k, F o r tu n e )? St r a te g ic spo n sorship s ( e .g . , Th e To n i g h t Sh o w w it h Ja y L e n o ,Form u la O n e Te a m , Su p e r B o wl F o o tb a ll Cl a ssic )? “The f a ct t h a t we a re p o sition in g o u rselve s in t h e sa m e class wi th t h eworl d ?s m e g a b ra n d s mak e s mag n ificen t im a g e marketin g f o r u s.”– Ta n p a n i Yli, S a v n a m 228。 ki, N o kia V ice P r e sid e n tInc re a s inge f f ic ie nc y a nds urf a c e a re a ofs a le s c h a nn e ls? Join t ve n tu r e wi th Ta n d y Corp o r a tio n t o d e li ver mo b il e p h o n e sto more t h a n 6 , 0 0 0 Rad io S h a ck sto r e s? Di stri b u tion co n tract wi t h A TT W ir e less Se r vices, f o rNokiabran d e d mo b il e p h o n e s? Di stri b u tion a g r e e m e n t wi th r e ta il g ia n t, Se a r s? OE M man u f a ctu r in g f o r c o m p a n ies in clu d ing G TE, Delc o ,So u t h weste r n B e ll , Be ll A tla n tic mo b il e syste m sNokia 6100 Series phone 23 Nokia kept its advertising consumer friendly and easy to follow, in contrast to their petitors who targeted professionals NOKIA COMMUNICATION STRATEGY ? Since the early niies Nokia?s value proposition to the consumer has been singleminded on ?simplicity? and ?ease? of using mobile phones ? The proposition of ?simplicity? is further enhanced by the tone of voice and visuals used in the munication ? The proposition has been municated through all their munication efforts both in mass media and at pointofsale 24 Source: Press articles。 annual reports。 ECCH Collection Case Study Nokia Motorola Ericsson Percentage of sales RD EXPENDITURES 1995 6 . 98 . 11 5 . 3Nokia spends relatively little on RD, but still achieves a high return on its RD investment through ? Numerous RD partnerships with outsiders such as universities, and hightech panies ? Outsourcing of noncore technologies (., microprocessors from Intel, ponents from Motorola, semiconductors from ATT) ? Focused RD programs concentrating resources on future growth areas。 ., cellular data transmission ? Use of cheap industry standard products as a base rather than more expensive systems Every third Nokia employee works in RD. RD centers exist in 14 countries on four continents. 25 JOINT RD ACTIVITIES “We do not aim to do everything by ourselves。 and when it?s necessary we form partnerships with other pioneers of technology。 this means focusing on what we are best at and plementing it with the expertise of others.” Partner pany Products Start ATT, . GSM ponents 1989 Qualm, . CDMA technology 1990 Cicso, . ATM works 1994 Geoworks, . Wireless products 1995 Psion, . Software for GSM 1996 Nokia has built extensive RD partnerships. For example, at the beginning of 1994, Nokia signed an agreement with HewlettPackard to cooperate in the development of Intelligent Network systems for telemunications operators. The agreement centers around the integration and development of key IN architecture elements. Source: Press clippings。 press releases。 Inter homepage NOT EXHAUSTIVE 26 President, Nokia Telemunications204。 Network and Access Systems Division Objective To jointly develop ATMbased (broadband) service solutions for petitive tele operators in deregulated markets that provide services for ? Corporate customers: need to increase connectivity across the pany ? Residential customers: require advanced data and video (multimedia) services Cisco ? Data and private work/corporate applications knowhow (market leader in switched interworking。 ., routers, LAN, and ATM switches Nokia ? Experience in tele operator business ? Expertise in voice transmission infra structure and work management “This cooperation answers the need for faster building of new petencies, faster RD cycles, and the right timing of product launches.” Source: Nokia press release。 press articles NOKIA/CISCO RD ALLIANCE – EXAMPLE In 1995, Nokia and Cisco Systems, ., established a strategic alliance to develop ATMbased work products to provide total tele service solutions to panies. 27 Date Alli anc eP a r t ner Capabilitie s Dea l de sc r ipt ion Imac t? S ep 0 0 ? S i e be l S y s te ms ? Ma r k et i ng? S el l i ng? Devel o pm en t? W orl dwi de j o i nt ma r k et i ng ,c ol l a bo r at i v e s e l l i ng , a n d exte nsivede v el op m en t of m ob i l eeB usi ne s s a p pl i c at i on s? E na bl es c om p l et e e n dtoen d mo b i l eeB usi ne s s s ol ut i on s fo r N okia c ust om ers? S ep 0 0 ? Tel l ab s ? Devel o pm en t? S trate gi c a gr