Ted James, the author of Operations Strategy, defines operations management as “the management of the processes that produce or deliver goods and services” (James, 2011, p.8). In the “Burning Platform” memo by former Nokia CEO Stephen Elop, he aligned with Ted James’ definition of operations management when discussing Nokia’s failures in innovation, in execution, in accountability, so that their failure to produce products which matter to customers (Arthur, 2011). James gave the role of operations management as managing the transformation the company’s inputs (information, materials, etc.) into finished products (James, 2011, p.8). Nokia failed to retain market share and failed to transform ideas and materials into meaningful designs and products which were worthwhile. Nokia was late to the adapting to the smartphone industry, so there were already two established ecosystems: Android and Apple, leaving Nokia with limited options except falling in line. Elop said that Nokia wasn’t even fighting with the right weapons while Chinese manufacturers brought new smartphones to market in the time that it took Nokia to make a PowerPoint (Arthur, 2011).
Hill’s framework for Operations Strategy has five steps: defining business objectives; determining the strategies for marketing to meet those business objectives; assessing how different products are competitive in terms of quality, speed, dependability, flexibility, and cost; determining the most appropriate way to deliver finished products; and providing the infrastructure that is needed to support the operations (James, 2011, p.11). In the case of Elop’s “Burning Platform” memo, he said “I believe we have lacked accountability and leadership to align and direct the company through these disruptive times. We had a series of misses. We haven’t been delivering innovation fast enough. We’re not collaborating internally,” indicating that there were a series of operational issues that led to Nokia’s failure (Arthur, 2011). This speaks to Hill’s steps of assessing how different products are competitive, delivering finished products, and providing the infrastructure to support operations. Nokia failed to get solutions to market fast enough, which signals a failure defining business objectives and of determining the strategies for marketing to meet objectives.
The creativity and design excellence, as well as the closed ecosystem of Apple is an external factor. The leadership of Android that attracted developers, service providers, and hardware manufacturers is also an external factor. The rapidly expanding consumer requirements and the extreme speed of Chinese OEMs are external factors as well. Lastly, the negative credit rating on the market due to Nokia’s lack of competitiveness is an external factor. Internal factors were bad decision-making, poor leadership, lack of accountability, slow speed to market, slow product development, and lack of collaboration.
Stephen Elop described the market situation with Apple, Android, and other manufacturers as a battle of devices and a war of ecosystems, where Nokia was fighting with the wrong weapons. He also described their own platform as burning, with explosions and “multiple points of scorching heat” around them (Arthur, 2011). I did not find this memo motivating and believed that it did not give hope, but instead filled me with despair. As a motivational memo, this failed, and would instead cause panic, low morale, and employee churn as frightened engineers move to other companies. This approach can backfire by demotivating staff and ruining their engagement.
References:
Arthur, C. (2011, February 9). Nokia’s chief executive to staff: ‘we are standing on a burning platform’. The Guardian. Retrieved from https://www.theguardian.com/technology/blog/2011/feb/09/nokia-burning-platform-memo-elop
James, T. (2011). Operations Strategy. Bookboon.com. Retrieved from https://bookboon.com/en/operations-strategy-ebook?mediaType=ebook