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Nokia is an international firm or in other words a multinational corporation. It is a very busy phone manufacturers company that deals with the services to the entire world population. This is a company that deals with services including issues like phone manufacturing, Computer accessories and pieces, servicing of most electronic products among others. It is therefore very paramount that the management of such organization must deal with the menace of fighting the major competitors like Samsung, Dell and Philips in the immediate market as this could help them in attaining the level ground in scrambling for the customers therein(Annual information Nokia, 2009).
The Company has its head quarters in Finland and has very numerous numbers of branches in the neighboring countries and other continents in the world. This is a company that is in great competition from other phone dealers. This will therefore call for proper and adequate discipline among the work force right from the top to the bottom of the managerial system in the country. This company prides itself in the availability of a wide range of consumers in the wide world. It yearns for management teams that take care of the sales, expenditure and bring a turnaround motive to the services offered at the company.
In order to achieve the best out of this company the employer or in other the individual responsible for the recruitments in this sector must be ready to tackle and face issues as they come their way. Since this a very sensitive sector to the economy of most countries, it is important to handle matters carefully and this calls for the proper drawing of the organizational structure by the top management. This model would help the management in the full understanding of the business environment based on the principles put down by Porter in his management tool design. It harmonizes the management functions at different levels and scales in the entire business enterprise. This would then help the entire management system in their allocation of funds to different sectors according to their respective strengths, weaknesses and needs (Zhugangqi, 2006).
Liquidity Ratio at the firm
Successful management of the funds and the escalated profit margins are through sound financial management. The finance department in this organization ensures that there is enough money for the expenses such as payment of debts, employees’ salaries and investment of cash for the continuity of the business advancement. The main source of funding is the share capital. The growth in the financial status of the company evaluation is through studying the trend in earnings and the share price (Reem, 2003).
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From the statements of accounts of the same organization in 2006, the earning per share was 20.07. This increased to 23.84 in 2007, 26.95 in 2008, 28.92 in 2009, 31.66 in 2010 and 33.10 in 2011. The profit recording for the company has been on the rise since 2002. The profits recordings for the last four annual reports are as follows: £ 2,130 in 2008, £ 2,166 in 2009, £ 2,336 in 2010 and £ 2,671 in 2011, which has consistently increased. However, in 2011, the company recorded the worst sales in United Kingdom in a historical period of 20 years. This resulted from consumer’s reducing their purchases of the non-foodstuffs in the company’s outlets.
The company enjoys a higher share in the market compared to its competitors. For instance, in 2009, the company’s market share was 30.5% compared to its closest rival, RIMM which was 16.9%. According to 2011 financial analysis, the customer loyalty was higher in Nokia Company than in that of its competitors. The customer loyalty scaled at 29.7 % for Nokia and 18.5% for RIMM the closest competitor (Pengxuzhi, 2006).
The possible risks that can threaten a business include unclear strategy, unavailability to meet business needs, fluctuations in interests and exchange rates. The company also seeks external advice for the best steps to be in the management of the problems realized in the company strategy. There is also consistent reviewing of policies in the treasury functioning.
Liquidity is a state when a company cannot sufficiently finance its activities or the ability to secure such interest comes with an extra cost. This risk hinders the development of the company leading to funding risk. There is a dedicated treasury functioning established by the company with the aim of managing the liquidity and funding risk (Reem, 2003).
Moreover, the organization has established a strong liquidity position with a wide range of stocks. This ensures that the sales of the different commodities help to cover instances of hidden zones for possibilities of liquidity risk. In addition to this, it has ensured that the retail trades other than the wider company manage lending of cash. This gives the retail trade a responsibility to monitor the lending and follow up to avoid bad debtors.
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The company also conducts a daily monitoring, management of key funding and liquidity ratios for early intervention before things slip to complicated levels. Another measure used by the company is conducting regular stress testing for determining the stability of the company in the market. These measures together ensure that the company manages its financial risk effectively, thus, retaining the position in the market. This form of risk arises in cases where liabilities and assets of an organization present different re-pricing dates. It counters this through minimizing the sensitivity of gross revenue to fluctuations in interest rates. The company uses Value at Risk to control interest risk, especially the short-term exposures.
Strategic Management at Nokia
Management strategy for this firm sets the general standards of quality, while giving franchises freedom to form localized decisions. This strategy improves the participation of the franchises in the decision-making process. Development of new products helps in addressing the issue of the customer’s concerns. Profitable value combination combines the ad campaign to promote products. A company with over 1 million budgets is capable of achieving a high level of consumer awareness. Customers describe ad campaigns as an easy method of customer satisfaction and acquisition of the best value products.
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Over two thousand people visit the firm daily with 60-70% preferring the after sale service on the products. Service is done within a remarkably short time hence coordination of activities ensures that the firm plus its outlets delivers the expected services. The service crew participates actively in these activities. The engineering department organizes a layout and the equipments. Operation strategies have a powerful component that anticipates customers flow patterns and selection of food depending on the history in the trend and analysis. The information guides the company in the preparation of menu. Security is beefed up once the food is stored in a bin for ten minutes before it is disposed (Reem, 2003).
The managers maximize the contact time with the staff and customers in order to acquire first hand information about the progress. Business Objects reports, questions and analyzes the issues in the company. Intranet acts as a medium of communication in the company. Oracle database contains restaurant performance, thus enabling the creation of sales income reports, business controls and the services delivery. Preparation of these reports occurs daily to enhance the efficiency of operation. Proper management and understanding of the business performance becomes easy and accurate. The management introduces measures that guide and enhances business promotion. Managers conduct three monthly visits to collect viable information regarding the firm. Management, however, recognizes the importance of product promotion due to the increased competition and price sensitivity. The ultimate target for the company is to maximize sales.
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This is also called the sellers power. From the books of the firm on the excel spreadsheet attached, it vivid that they emphasize on the use of the work force than relying too much on the technology in the United States as opposed to other countries of the world. The work force needed to serve the customers should undergo regular training. Communication strategy in the company is crucial in the relationship between customers and the members of staff. Proper communication skills ensure that customers get service efficiently, since no distortion of information occurs.
Employees receive information constantly from the management through blogs. This ensures that they get proper information about the company and the need to embrace it. The company finds an easy task training the workforce due to the information provided in advance. The company strategizes methods of staff training in a proper manner. Effective workers should be flexible. The flexibility enables the workers to serve people from different cultures (Martti, 2003).
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The firm must recognize the importance of workers as evidenced by the supply chain. The company takes advantage of the fact that its suppliers have the same characters; hence it borrows some ideas from it. It treats the employees with respect, dignity, and fairness. Most of the suppliers have a stable workforce and operate in large scale hence ideas borrowed from them can help in expansion. It should consider all genders in the employment, thus implying that nobody has an upper hand during employment. The other solar companies normally have a greater percentage of unqualified employees.
Competitive Advantage of Nokia
This is the avenue that the firm uses in order to quench the threats from both substitutes and those from new entrants in the market. It has three strategic priorities incorporated in the important values. The first priority emphasizes on the value-meal combination targeting to enhance the company’s objectives on behalf of customers. The value combination targets to increase the number of customers. A relatively low price results from the quality type of product. Most people like it when the amount of money spent match the quality of the commodity. Low quality products signify consumer exploitation, especially when the price fixation becomes unfavourable for the customers. Nokia should generate innovative ideas in order to ensure that the company gains much profit without influencing customers negatively.
The company targets to increase the quality of services for its customers. The company targets to increase the contact with its customers through communication, efficiency, high quality products and servicing techniques. Proper communication procedure considers culture. Religious, moral and ethnic factors considerably affect the information to be conveyed (Reem, 2003).. This ensures that the company does not neglect certain individuals, since the Company targets to increase the number of customers. The firm embraces American cultural imperialism to survive the competition existing market countries. Notably, the cultural system emphasizes on children culture, but it chooses to ignore it. However, the company targets to create a world of changing families enabling individuals to acquire new ideas from the advancement in the solar technology.
The third factor emphasizes on the cost reduction without putting the quality on the line. Innovations in the field of energy processing, design, and construction, create efficiency in production. Production efficiency increases company’s profits without overcharging them. The local culture does not condone the activities of the company where the customers conduct a clean-up exercise once they finish daily chores. However, some companies dropped this method, since it bothers the customers, hence creating a risk of losing them. Customer’s satisfaction must be the main goal of all firms (Reem, 2003).
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Customer Services at the Firm
Nokia prides itself in the full satisfaction of the customer’s wants. Indeed a recent study revealed that this is the handset that is used widely in the whole world. It is amazing that these gadgets are found in almost all the settings in the world. This gives the company a wide range of facelift in the branding category. This is also called the buyer’s power. Managers emphasize on the importance of the customers understanding. Managers stay abreast with corporate and local cultures in every country. Customer’s satisfaction becomes the first priority for the company. The Company studies the culture of most locations well and makes them understand the importance of new product brand in the phone industry. The locals may have their own taste; the company creates some uniqueness to attract the new customers.
Customer satisfaction attainability depends on the ability to incorporate a number of factors including fairness, branding and responsiveness to the customer’s grievances. The ability to win customers’ confidence for a long period challenges most companies. Customer’s confidence links the customers to the company, hence enabling it to attain long-term loyalty. Consistency determines the profits that the company gets. Companies that have a constant number of customers enjoy the ease of operation (Martti, 2003).
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Violation of the customers’ right creates unfairness forcing the customers to opt for services from other companies. Attainment of total fairness in the operation relies on the ability of the company to observe the justice principles. Branding of the products is crucial in the ability to attract customers. Modern trend in online branding creates a number of challenges and at the same time an opportunity and experience for digital branding environment. Businesses should adopt integrated brand strategies. The experience and presence brand creates pleasurable experience in product branding. Consideration of customer’s grievances at the opportune moment helps the company win their trust. The Company should make changes in the products or services depending on the customer’s grievances. It must treat issues leading to the customer’s dissatisfaction as crucial. The managers are particularly vigilant on these matters and have an outstanding team working to solve the problems hampering the smooth flow of activities. According to a recent study by the BCR research group, it emerged that Nokia is indeed classified under the most troubled mobile device manufacturers. Some even claim it is in a worse situation than its counterpart in Canada, RIMM. Nokia has been losing a lot of sums for a much longer time as compared to the RIMM. The confusion between the two companies on matters pertaining to the collapse of either is a much daunting task. This is likened to a patient who has a survival chance of replacing either his kidney or liver. Both organs are important and one may find it difficult to choose between the two (Martti, 2003).
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It has lost money for about six consecutive quarters. These loses have even topped the 1 billion dollars. Indeed it lost over 1.27 billion dollars within the last quarter. All these are still pegged on the large market base it has across the world. Nokia looks like it has lost grip on its long term business strategy. It has lost most customers and even its Black Berry 10 operating system really delayed the expectations of the customers in a global perspective. Nokia has stuck with the Windows phone 8 which is yet to be released into the market. Thus clearly shows how the company has stuck its nose out in order to satisfy the needs of the customers to no avail.
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