ASSIGNMENT ON

BUSINESS ENVIRONMENT ANALYSIS OF

NOKIA

NAME:

HIREN D ASRANI

ROLL NO: ERBF12008

INTRODUCTION:

Nokia is the worlds number one mobile phone company and a successor in the global phone
Industry. Being an Industry leader on a Global level, Nokia is fully engaged into excelling
environmental performance and assume Cooperate responsibility in all their operations. It
therefore maintains its position by living up to its slogan, Connecting People, by abiding to
three main objectives; Speed of anticipation and fulfilling evolving customer and market needs,
strong customer recognition and upholding a solid and positive relationship with its
stakeholders. However, as any other organisation, Nokia faces many challenges which forces
flexibility and ease of transformation on their way of executing operations. How then, does
Nokia operate in accordance to the different aspects as far as business is concerned?

1. BUSINESS ORGANISATION AND ENVIRONMENT

This is the first aspect in consideration and Nokia must relate the different Environment with
their effects to the Organisation respectively. Environment are divided into two main categories,
Controllable and the Non-controllable Environment, and they work in a butterfly effect system
which means alteration of any environment can affect the other and so on.
Overview of Environment and their relation to Nokia

CONTROLLABLE
ENVIRONMENT

NON-CONTRALLABLE
ENVIRONMENT

1. LABOUR
2. RAW MATERIAL
3. EQUIPTMENT
4. CAPITAL
5. ENTERPRENEUR
CONTRALLABLE ENVIRONMENT

1.
2.
3.
4.
5.
6.

POLITICAL/LEGAL
ECONOMY
SOCIO-CULTURE
TECHNOLOGY CHANGE
COMPETITORS
GEOGRAPHICAL
FEATURES
This Environment focuses on the attributes that add up to structure
the organisation, the
7. of
STAKEHOLDERS:
Employees,
reason for its existence. They can be controlled in the sense that the organisation
dictates the
Community,
Suppliers
quantity and how much to be used depending on their available resources
and therefore
differ
and Customers.
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from different organisations. Refer to the diagram on page 1; the five attributes as you can see
are the major make-up of the organisation and without them, it is dormant to all its operations.
Labour points out the human resources, the actual workers who provide physical or
intellectual contribution to the everyday activities within the organisation.
Raw Material is the physical bits and pieces that are provided by suppliers to
manufacture the companys end products.
Equipment refers to the machinery or devices that play a role into converting the raw
materials to finished end products.
Capital is the cash flow or the monetary aid the organisation needs to acquire and
achieve its goals, it is the most important because it keeps the other attributes active and
functional.
Last but not least, the Entrepreneur who are directly involved in the organisations
operations. These are Individuals or Groups that take into risk and invest so as to see
the Company achieving the posted goals.

Adding on to the listed, each attribute is vital for the company existence but they must be
balanced and considered equally in order to prevail in the market competition. Nokia recognizes
this and take hide to see each attribute contributes accordingly.

NON- CONTRALLABLE ENVIRONMENT

This environment sheds light on indirect attributes that affect the organisations operation. They
cannot be controlled in the sense that the organisation is unable to change or alter them in any
way but on the flipside, they can alter the organisations intermediate processes. Refer to the
diagram on page 1, each attribute in this environment plays a role into shaping the way of how
the organisation must carry out its operation and they differ in their magnitude of effect, thus
cannot be considered equally by the organisation.
Political/Legal environment are usually considered as one because they are enforced by
the nations government. It is vital for Nokias operation because different nations with
their respective government have different Political/Legal platforms respectively; Nokia
operating on a global level must abide to ground rules and regulation in different markets
of host countries around the world. To its success, Nokia surveys its scope of limits in
order to isolate prohibited actions, regulations and aid from the government so as to
withstand the international trade. Quotas (limit to goods imported), embargoes
(restrictions), tariff and tax charges, subsidies and patents over certain technology or
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equipment are decided by the government so Nokia works hand-to-hand with authorities
to gain maximum advantage to the Nations target market. Laws of copyright and abuse
of phone usage keeps Nokia ahead, it limits any space of intrusion or misuse of their
products.
Economy tells the production and consumption of goods and services. As far as Nokia is
concerned, the economic system is critical as it can control what the organisation is to
produce, how it should produce and the category of recipient who should use their end
products. On one hand, aspects of international trade is important for Nokia being the
global supplier of mobile phones and on the other hand, the knowledge concerning the
nations economic status (Type of economic system practiced, Inflation rate, level of
employment and exchange rate) is equally as important to realize future plans for
personal and financial safety together with enhancing entrepreneurship.
Socio-culture focuses on how Nokia blends in with components in a society; that is
culture, social class, lifestyle and demographic and psychological factors making up the
society. Nokia operates in a diverse number of culture and all levels of social class
simply because different models are frequently released to satisfy all individuals despite
their difference in race, nationality, religion, income level or beliefs among each other.
Mobile phones can easily adapt to any culture and can be used to support different
aspects and existing patterns of Individuals lifestyle or behavior.

Technology change defines how fast technology advances. Being the predominate
medium by which we get things done; technology as a process, in terms of mobile
phones defines the way we make contact. Not only does it helps shape culture but also
changes other aspects within and/or outside the organisation. The success of Nokia is
based on constant innovation on human technology. By enhancing communication and
exploring new ways to exchange information, connecting people, Nokia allow users to
get more out of life.

Geographical features explore the twists and turns of Mother Nature. Note on weather,
climate, landscape, scope of natural disasters and other physical features of a nation
plays a role for any organisation.

This environment can affect where to settle your business and Nokia research center
must also be innovative in their product design; adding additional feature such as
hydrophobic material, high melting point plastics to prevail adverse conditions of a
nation.

Competitors are essential in a business environment as it promotes delivery of quality

goods and services to the users. Threat of Entry from other new coming organisation,
threat of substitute products, bargaining power of suppliers and buyers respectively and
Intensity of rivalry within the industry are crucial notes that Nokia must be aware of.
Adding on to that, Nokia manages to stay ahead of its competitors by investing much on
Research and Development (Nokia Research Center) and upholds customer
recognition, therefore manages to provide the best and maintain a trusted Brand name.
Stakeholders are groups of individuals or groups that take stake to the organisation
and/or are affected directly or indirectly by its actions. Entrepreneurs and the
Government are also known as stakeholders in the business world.
-

Employees make up the Labour (Human Resource) but they are also stakeholders in
the sense that the organisations actions and/or decisions can affect them and vice
versa. Tasks and duties require different skills from employees so Nokia approves

continuous learning from their employees to harvest the best result from them.
Community as a whole is everyone in one place. It covers a bigger population and
includes people and what affects them. Among the cooperate responsibilities Nokia
possesses is to connect with diverse communities they affect so as to channel the
impact into a positive societal contribution. The current strategy at play is on two
major areas; using mobile communications to stimulate development and supporting
young people thus managing to bridge the gaps of communication between
communities. Nokia host a TV show in Malaysian most popular TV provider (Astro)
called Nokia Football Crazy and therefore staying close to its community by

supporting the football spirit among the young people in Malaysia.

Suppliers support the provision of raw materials, they add a great deal of effect onto
the organisation and Nokia manages to control their bargaining power and maintain
a mutual relationship. They spend years working with them and provide a good
opportunity for them to improve their inputs and their environment performance.
Along with that, Nokia assigns a global supplier requirement that includes ethical
considerations that applies to both, direct and indirect Suppliers.
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As mentioned earlier, strong customer recognition is one of Nokias objectives to

fulfill. Customers determine the success of any organisation, they have a free will on
what to buy so Companys need to seek and provide them with accessible products
to meet their needs and trade with them responsibly. Product design focuses on the
customer and their requirements thus summing up the slogan, Human
Technology.

All Environments are essential in a business world but for an organisation like Nokia,
Technology change is the most important for them to be careful with. Technology
changes at a fast pace and its change will be very dramatic in the future. It is very
important for Nokia to evolve their hit products.
2. CHANGING NATURE OF ORGANISATION

Nokia is a public limited organisation that is privately owned by group of Individuals.

Such organisations consist of seven shareholders but of a large number of investors.
They can have two directors who can retire at age seventy. Nokia practices a free trade
shares with investors who can contribute capital into the organisation so there is easy
transfer of shares but too many stakeholders may lead to weak control of the business.

Nokia system of operation is open in the sense that it interacts with the environment
accordingly, keeps a close relationship with its employees and maintains motivation and
satisfaction to increase their production.

On a further note, Nokias reason for existence is based on the need of faster and
improved communication among people around the world. Communication in turn
brought up globalization and finally development; but business environments changes
from time to time and organisations need to foretell future plans and become flexible to
resulting changes. Employees can bring about change due to their behavior or roles and
so can Equipment (Technology) but Nokia is suited in this sector because it has invested
much on Research and Development to neutralize the pressures of change along with
time. Adapting to change implies stability on Organisations operations.

So what is Changing nature of the organisation? Basically, how the organisation

changes and how fast does it changes due to the changes in the business environment
discussed previously; therefore all components of an organisation are such that they
work together to control the changing business environments.

3. INDIVIDUAL AT WORK

This last aspect is about Individuals (Employees) and their relation to their work. Being the
labour that works to the success of the organisation, the Head of organisation must keep in
mind their significance.

As far as Nokia is concerned, the physical character is not much of criteria to be strict about;
despite the gender, age, body size and their race as long as the employees perform their
jobs well. As a matter of fact, Nokia branch offices set up events to embrace the celebrations
of different cultures from respective nations just to make them feel at home. However, Nokia
takes note on Employees ability and personality. Different tasks and department require
special abilities that are not equal thus not every employee can possess. For example the
R&D department will require employees who are creative and innovative; likewise, the
Logistic department will require ones who are good at computing and analyzing vast figures.

Employees personality also differ from one to another, while others are calm and self
controlled, some may be temperate, emotional or self centered. Working together is a
challenge that some may find it hard to deal with and in turn affect their work. Nokia can find
ways to motivate their employees based on their abilities and personality and these are
features they possess and cannot be overlooked when being recruited to work in the
organisation.