When Stephen A. Elop took over leadership of a Nokia from Olli-Pekka Kallasvuo, he was facing a world of pain. Nokia was on a kind of death row, with lousy phones, a clumsy Symbian operating system, and a destructive refusal to acknowledge that it was no longer a market leader. Nokia’s phones were brushed out of the market by Apple and Samsung around 2007-08, and it had started to seem like there was no going back. That’s when Elop came in. He was an unconventional choice for the Finnish mobile company, since he was its first every non-Finnish CEO. Almost 2 years later, it looks like the bet paid off.
One of the first things that the Canadian with experience in companies like Microsoft and Macromedia did was to force Nokia employees to face the music. He sent out a rather grim memo to the staff, comparing the company to a person standing on a burning oil platform. Another drastic move that has marked his career so far is the dumping of Symbian for Microsoft’s Windows 8. Both these steps have received a mix of appreciated and criticism, but Elop did what he had to do and the results have started to show.
The company downsized significantly, sold its headquarters, closed factories and got rid of a huge array of perks. Then the Lumia came along and sparked new hope for those that had totally given up on the one-time market dominator. Just last quarter, Lumia’s sales ascended by 50%. Francisco Jeronimo, an analyst with the International Data Corporation in London, was quoted saying that Lumia starkly stands out from its Symbian-run predecessors, and could be seen as a harbinger of revival for Nokia. The top-of-the-line models in the Lumia series, 920 and 820, have been closely compared with iPhone 5 and Galaxy S III.
As everyone awaits the figures from last quarter, Elop gladly announced that the company will breakeven or make a 2% profit. This is in stark contrast with the 10% loss that analysts were expecting. This doesn’t mean that Nokia is quite there yet. January and February are usually low-buy months, and it’s hard to predict what will happen after. Right now, Elop can look back at his severe measures with some relief and gratification, but his uphill battle has only just begun. As Pete Cunningham, an analyst at research firm Canalys put it – there is a lot of work to be done!
