Nokia Reorgs Evidently Biannual

Published on May 11, 2010
by John Paczkowski

51X00X3ZKSL._SL500_AA240_“A simplified company structure.” Evidently, that is the solution to all Nokia’s problems–to the erosion of its share of the smartphone market and its failure to develop a worthy rival to the likes of Apple’s (AAPL) iPhone and Research in Motion’s (RIMM) BlackBerry.

And so this morning, the handset maker announced another sweeping overhaul of its management structure, its second reorganization in less than a year. This time around, Nokia (NOK) is dividing its Devices and Services business into three units.

Mobile Solutions (smartphones and services), will be headed by Anssi Vanjoki; Mobile Phones (low-end handsets) by Mary McDowell and Markets (sales, marketing and distribution) by Niklas Savander. Solutions will handle smartphones and services; Mobile will oversee Nokia’s low-end phones and Markets will take care of sales and marketing, supply chains and sourcing. (Click on chart below to expand.)

Another significant rejiggering of Nokia’s management. Interestingly, there appears to be no place in it for former Chief Financial Officer Rick Simonson, who was tapped to run the company’s mobile phone business as part of its last restructuring seven months ago. Remember, it was Simonson who heralded Nokia’s recovery in smartphones.

“Yes, we have lost ground in the smartphone space over the past 18 months, but the decline has stopped and stablised in the second and third quarters of 2009,” he told India’s Economic Times in January.

“The New Year will see [our] recovery in smartphones….By 2011, our efforts will start producing results, as we will be at par with Apple and RIM in smartphones,” Simonson added. “Not only [will] we draw level with them, we will also win the war because, in addition to e-mail, we will be adding content, chat, music, entertainment and several other features, which will soon become very critical for success of any company in this space.”

Pulling that off evidently wasn’t quite so easy as Simonson or Nokia expected.

In any event, Nokia believes it has things dialed in now. “In addition to extending our leadership in mobile phones, we are decisively moving to respond faster to growth opportunities we expect in smartphones and mobile computers,” CEO Olli-Pekka Kallasvuo said in a statement. “Nokia’s new organisational structure is designed to speed up execution and accelerate innovation.”

In theory. But in practice? Well, we’ll have to see how things play out. The company’s last organizational shakeup was intended to do exactly the same thing, and as far as I can tell, didn’t substantially improve Nokia’s position in anything.

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