Nokai: a Case Study of Expansion and Specialisation
Introduction
Nokia Corporation once transcended its current business of mobile and telecommunication service production as it is currently known.
The corporation started out as a paper, rubber and cable manufacturer. It later in its life expanded to include consumer electronics and mobile and telecommunication.
Due to certain constraints and shortcomings, and also new opportunities for growth in mobile-telecommunications, the corporation built its new identity with only mobile-telecommunications as its operative sector and core business.
This report deals with the company’s establishment, its diversification and internationalization and finally the issues that led to its divestment from other interests and retention of mobile-telecommunication as its core business.
History of Nokia
The company was first started as a paper manufacturing firm by Fredrik Idestam at Tammerkoski Rapids in south-west Finland. Due to the European industrial revolution and the growing consumption of paper and card-board the company soon became successful. The company was named Nokia Abs in 1871 and added electricity generation to its business in 1902. The company launched its electronics department in 1960 (Nokia, 2008).
The merging of three companies, Nokia Abs, Finnish Rubber Works (founded 1898), and Finnish Cable Works (founded in 1912) led to the formation of the Nokia Corporation in 1967 (Nokia, 2008).
Investment in Consumer Electronics Product
The corporation’s venture into consumer electronics was influenced in part by the energy crises of 1973. The crisis was cause by member countries of the Organization of Arab Petroleum Exporting Countries (OAPEC) to halt the exportation of crude oil to nations that supported Israel during the Arab-Israeli conflicts. The shortfall in oil supply created by that resolution led to a general increase in oil prices across the globe. Oil dependent industrializing countries of Western Europe, United States, and Japan were adversely hit
Nokia Corporation once transcended its current business of mobile and telecommunication service production as it is currently known.
The corporation started out as a paper, rubber and cable manufacturer. It later in its life expanded to include consumer electronics and mobile and telecommunication.
Due to certain constraints and shortcomings, and also new opportunities for growth in mobile-telecommunications, the corporation built its new identity with only mobile-telecommunications as its operative sector and core business.
This report deals with the company’s establishment, its diversification and internationalization and finally the issues that led to its divestment from other interests and retention of mobile-telecommunication as its core business.
History of Nokia
The company was first started as a paper manufacturing firm by Fredrik Idestam at Tammerkoski Rapids in south-west Finland. Due to the European industrial revolution and the growing consumption of paper and card-board the company soon became successful. The company was named Nokia Abs in 1871 and added electricity generation to its business in 1902. The company launched its electronics department in 1960 (Nokia, 2008).
The merging of three companies, Nokia Abs, Finnish Rubber Works (founded 1898), and Finnish Cable Works (founded in 1912) led to the formation of the Nokia Corporation in 1967 (Nokia, 2008).
Investment in Consumer Electronics Product
The corporation’s venture into consumer electronics was influenced in part by the energy crises of 1973. The crisis was cause by member countries of the Organization of Arab Petroleum Exporting Countries (OAPEC) to halt the exportation of crude oil to nations that supported Israel during the Arab-Israeli conflicts. The shortfall in oil supply created by that resolution led to a general increase in oil prices across the globe. Oil dependent industrializing countries of Western Europe, United States, and Japan were adversely hit
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