Nokia competitive advantage analysis

NSTRUCTIONS: Based on the answers below - Please come up with 3 creative and in-depth research questions.

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The Nokia-Microsoft Alliance in the Global Smartphone Industry (circa 2011) (pages 239-240).

1. Do a SWOT analysis of the Nokia-Microsoft alliance in the global mobile phone industry.

Strengths: There are many evident strengths associated with the Nokia-Microsoft alliance. Primarily, the alliance will create synergy between the firms. “In the global economy, a well-developed ability to create and sustain fruitful collaborations gives companies a significant competitive leg up” (Kanter, 1994). The alliance allows both companies to increase their presence in the global smartphone industry, capitalizing on each other’s strengths. Nokia will take advantage of the Microsoft’s cash infusion as well as their software, while Microsoft will capitalize on Nokia’s stable networks and established operations and clientele (Deresky, 2014).

Weaknesses: Nokia and Microsoft also have weaknesses, as both firms are fighting declining market share. While Apple and Google bolster their market share, they are consequently increasing the lure for top-developers to come on board. Contrarily, Microsoft and Nokia’s lackluster market share has the opposite effect. A recent LinkedIn study reports Apple and Google to be the first and fourth most attractive global companies to employees, while Microsoft is sixth, and Nokia is not listed (Burgess, 2016).

Opportunities: Opportunities are abundant with the subject alliance, specifically as it will allow Microsoft to increase their software’s presence with smart phones, having a positive impact on their bottom line. This deal provides Nokia with the ability to develop a smartphone capable of competing with the Apple and Google, also resulting in the opportunity to increase their presence in the smart phone industry and ultimately, their bottom line.

Threats: The main threat to both Microsoft and Nokia is their competition. As previously mentioned, both firms are experiencing declining market share in the smart phone industry, which compounds negative impacts. Competitors are increasing their market share, increasing the talent lure, and constantly improving on their technology. It is tough for firms lagging behind the big firms to catch up at this point. Nonetheless, the alliance is valiant effort to challenge the threats. “Microsoft’s acquisition of Nokia’s troubled smartphone business represents a daring $7.2 billion attempt by the software giant and a once-influential cellphone maker to catch up with the mobile computing revolution that threatens to leave them in the technological dust” (Liedtke, et al., 2013).