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Why did Nokia fail and what can you learn from it?

Why did Nokia fail?

This article presents one of Nokia’s reasons for failure and what you can learn to improve your leadership.

A concise timeline of Nokia’s important moments:

• In October 1998, Nokia became the best-selling mobile phone brand in the world;
• Nokia’s operating profit went from $1 billion in 1995 to almost $4 billion by 1999;
• The best-selling mobile phone of all time, the Nokia 1100, was created in 2003;
• In 2007, Apple introduced the iPhone;
• By the end of 2007, half of all smartphones sold in the world were Nokias, while Apple’s iPhone had a mere 5 per cent share of the global market;
• In 2010 Nokia launched the “iPhone killer” but failed to match the competition;
• The quality of Nokia’s high-end phones continues to decline;
• In just six years, the market value of Nokia declined by about 90%;
• Nokia’s decline accelerates by 2011 and is acquired by Microsoft in 2013.

Nokia’s demise from being the world’s best mobile phone company to losing it all by 2013 has become a case study discussed by teachers and students in business management classes.

When explaining Nokia’s fall many observers found three reasons:

1. Nokia’s technology was inferior to Apple’s;
2. The arrogance among top-level managers;
3. Lack of vision.

In order to understand its rapid downfall from its position as a world-dominant and innovative technology organisation, Tim O. Vuori, assistant professor in strategic management at Aalto University and Qui Huy, Professor of Strategy at INSEAD Singapore conducted a qualitative study. The results were published in the 2015 paper Distributed Attention and Shared Emotions in the Innovation Process: How Nokia Lost the Smartphone Battle.

The study consisted of interviewing 76 Nokia top and middle managers, engineers and external experts and conducting in-depth investigations.

Here is what Mr Huy and Mr Vuori found:

• At that time Nokia suffered from organisational fear;
• The organisational fear was grounded in a culture of temperamental leaders and frightened middle managers;
• The middle management was scared of telling the truth because they feared being fired;
• Top managers were afraid of the external environment and not meeting their quarterly targets;
• Executives were afraid to publicly acknowledge the inferiority of Symbian, Nokia’s operating system;
• They knew it would take several years to develop a better operating system that could compete with Apple’s iOS;
• Top executives were afraid of losing investors, suppliers and customers if they acknowledged their technological inferiority to Apple;
• Top managers intimidated middle managers by accusing them of not being ambitious enough to meet their goals;
• Top management was lied to by middle management who felt telling the truth was useless;
• Top managers lacked technical competence which influenced how they could assess technological limitations during goal setting; by comparison, the top engineers at Apple were all engineers;
• Instead of allocating resources to the achievement of long-term goals such as developing a new operating system, Nokia management decided to develop new phone devices for short-term market demands.

The experts’ conclusion regarding why Nokia failed to adapt and compete is this:

Nokia’s ultimate fall can be put down to internal politics . In short, Nokia people weakened Nokia people and thus made the company increasingly vulnerable to competitive forces. When fear permeated all levels, the lower rungs of the organisation turned inward to protect resources, themselves and their units, giving little away, fearing harm to their personal careers. Top managers failed to motivate the middle managers with their heavy-handed approaches and they were in the dark with what was really going on.

Key takeaways

Nokia’s culture of status has led to an atmosphere of shared fear which influenced how employees were interacting with each other. The human factor was added to economic and structural factors and together they have generated a state of “temporal myopia” that hindered Nokia’s ability to innovate. Employees stated that top managers and directors were no longer abiding by Nokia’s core values of Respect, Challenge, Achievement and Renewal. This study points out the paramount importance of shared emotions among employees and their powerful impact on the company’s competitiveness.

We asked Amalia Sterescu, Leadership Consultant what steps should leaders take to keep themselves connected to their employees and be aware of their emotions and state of mind.

In a world dominated by digital transformation, leaders should understand that operating with the old mindset will not help their companies face customer behaviour changes or new types of competition — more aggressive and more diverse.

• Having the power of constantly challenging the status quo will allow leaders and their organisation to embrace a culture of change;
• Collaborative leadership style will be mandatory, the policy of closed doors will die quickly — innovation process should be encouraged at all levels but for this leaders have to learn again how to properly listen to their customers, partners and employees;
• Before being able to understand their employees’ emotions, leaders will have to become more mindful. Emotional intelligence in action will not be just a competence nice to have — will become mandatory especially when at the decision table leaders will have a mix of generations including Millennials and Z;
• In the end, leaders should master the power of taking responsibilities for bad decisions, failed innovation, lost market share despite the danger of losing their status, role, bonuses. Learning fast from failures or from other companies’ failures will help leaders repair, minimize risks & damages and design better services & products;
• Middle managers will need more courage to challenge the CEO or Sr. Leadership for the benefit of the whole organisation and to accomplish this HR should act as a real business partner and mitigator.

Microsoft learned from Nokia’s mistakes and changed its culture.

In 2014, Satya Nadella became the current CEO of Microsoft, following Bill Gates and Steve Ballmer.

The most important change that Satya brought to Microsoft was shifting the company’s culture. He says that his job as CEO is to create a culture that focuses on listening, learning, and harnessing individual passions and talents. Satya also placed employer empowerment at the core of Microsoft’s culture.

Company culture is not to be taken lightly. In fact company culture is a major factor that contributes to the company’s development and ability to compete and be successful.

Company culture starts at the top and grows at the bottom. It includes mission, values, environment, ethics, expectations, overall mood, goals etc. But unless the company’s leadership fully embraces them, they are just beautiful but empty words. Leaders must embody the company’s values and be role models for their employees.

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The best phone to buy right now

Buying a new phone can be a chore, but we’ve done the work for you

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Due to a confluence of factors in 2021 — from production delays thanks to the ongoing pandemic, rising costs of labor and components, to the global chip shortage — prices for flagship phones have been higher than ever. The absolutely premium phones, like the Apple iPhone 13 Pro Max and Samsung Galaxy Z Fold3 5G, now cost well over $1,000, or about the price of a good laptop. Even if you’re willing to shell out top dollar for the best smartphone of 2021, it’ll take lots of luck and patience to get one into your hands this holiday season.

Thankfully, you no longer have to spend a huge amount to get something amazing, as a bunch of great smartphones are available for around $600 to 800 this year. In fact, if you like Android, the best phone for your buck this holiday season is the $599 Google Pixel 6. For everyone else, our pick for the best overall phone is the $829 Apple iPhone 13.

And if you want to get the best smartphone on a budget, you can find something really good for under $500 or even less. For those recommendations, you can check out our guide to budget smartphones.

A great smartphone should last you for several years (at least), have a great camera, a nice screen, long battery life, and be fast enough to do all the work, social networking, and gaming you want to pack into a day. After all, upgrade cycles are slowing down: people are holding onto their phones for longer, so they’re looking for features that will last a few years. Believe it or not, most top phones are pretty neck and neck in terms of their user experience and features these days — so picking the best one is often a matter of degrees or preferences.

Apple iPhone 13

Starting at $829 (without activation), the iPhone 13 features a new A15 Bionic chip, an OLED display, 128GB of internal storage, and compatibility with all 5G networks. Available in black, teal, red, white, and pink.

Google Pixel 6

The Google Pixel 6 is the new base model of Google’s latest flagship. It features the Google Tensor CPU, 8GB of RAM, and a rear camera with both 50 megapixels for its main wide-angle and 12 megapixels for its ultrawide.

The best phones 2021

The iPhone 13 can do it all: it hits the sweet spot between price, pocketability, and features. Photo by Vjeran Pavic / The Verge

1. Apple iPhone 13

Best iPhone to buy in 2021

Out of the four iPhone 13 variants that Apple launched in 2021, the $829 iPhone 13 (unlocked) hits the sweet spot between price, pocketability, and features.

It has a new processor, a bigger battery, 128GB of internal storage, and uses the same large camera sensor as the acclaimed iPhone 12 Pro Max, but you wouldn’t know it from its compact size.

In fact, the 13 looks almost identical to the 12 but is just a bit thicker and heavier, with substantially bigger camera bumps and lenses that swapped places. (No, you won’t be able to reuse your iPhone 12 case for the 13.) Otherwise, it has the same overall design, a brighter 6.1-inch OLED display, the same 12-megapixel selfie camera, the same MagSafe wireless charging, the same water and dust resistance (IP68), and the same support for both sub-6GHz and mmWave 5G networks. On top of all that, it comes in five colors (including pink), one more than you can choose from in the Pro models.

What’s different with the iPhone 13’s new A15 Bionic chip is that it should still feel fast in years to come, but it’s difficult to measure significant speed improvements with iPhones. The new chip helps the iPhone 13 run more efficiently, which lasts well into the evening without needing a top up.

Using the same camera sensor that made the iPhone 12 Pro Max the best smartphone camera for photos and videos in 2020, the iPhone 13’s main wide-angle camera has

significantly improved. Photo details are sharp and accurate, colors are rich without being oversaturated, focusing is fast and reliable, portrait mode is good enough to use day to day, and low light and night sight are both exceptional. Its ultrawide camera, on the other hand, has only been minorly updated for better low-light performance.

Video quality is also great. The main camera has sensor stabilization, which helps when you’re walking around. It can do all the modes that matter in terms of 4K and slow-mo and handles them all super well. It even lets you record videos in Cinematic mode, which helps you smoothly switch focus between subjects by changing the depth of field.

The iPhone 13 starts with 128GB of storage. Because its storage is not expandable, and depending on how you’ll be using the phone, you might want to bite the bullet and upgrade to the next tier.

For most people, the iPhone 13 is an easy choice: it offers similar performance, design, camera features, and (sometimes) better battery life than other iPhone 13 models, for less money.

The Pixel 6 (right) is Google’s first flagship phone, and it’s already right up there with the best from Apple and Samsung. Photo by Becca Farsace / The Verge

2. Google Pixel 6

Best Android phone to buy in 2021

The Pixel 6 is a lot of phone for $599. As Google’s first true flagship phone since 2019, the Pixel 6 gets many things right and is right up there with the iPhone 13 Pro and Samsung Galaxy S21 Ultra in camera quality, overall performance, and battery life. When you consider the fact the Pixel 6 is a good $200 less than its rivals, it’s simply the most value-packed flagship phone for Android fans this year. Sorry, OnePlus.

You can tell the Pixel 6 from the Pixel 6 Pro by its slightly smaller 6.4-inch, 1080p OLED flat display and bolder color choices like two-tone red or green (black is also an option). For a relatively big phone, the Pixel 6 is not too thick yet feels substantial. That said, its glossy body is super slippery, so you’ll need to budget for a third-party case (forget the Google ones, they aren’t worth the money).

At the heart of the Pixel 6 is Tensor, Google’s first proprietary mobile processor that is on par with the Qualcomm Snapdragon 888 chip inside other Android flagships. Tensor allows the new Pixel to lean into Machine Learning and Artificial Intelligence to learn some new tricks. You can use the Magic Eraser to remove photo-bombers from your photos, take

photos that better reflect real skin tones, as well as use Google Assistant to handle automated calls for you. The Pixel 6 has 8GB of RAM, 128GB or 256GB of internal storage, and runs the latest Android 12 software with Google’s new Material You theming.

Inside its sizable rear camera bar are dual cameras, 50-megapixel wide and 12-megapixel ultrawide cameras, along with a laser detection autofocus sensor for low-light and depth. Unlike the Pixel 6 Pro, the 6 doesn’t have a telephoto camera. Still, its images are very good in both normal and low light and very competitive with the best from Apple.

The Pixel 6 has a 4,614mAh battery (should last two days for light users), supports Qi wireless charging, and has some protection from rain storms (IP68). Its main weakness is a slow under-screen fingerprint scanner, and the phone lacks a face unlock option. While not perfect, the Pixel 6 is an all-around good phone for $599 and is our pick for the best Android phone to buy right now.

Both the iPhone 13 Pro and iPhone 13 Pro Max share the same camera system, so either Pro models will be good for content creation. Photo by Vjeran Pavic / The Verge

3. Apple iPhone 13 Pro and iPhone 13 Pro Max

Best phone for photography and video in 2021

Both the iPhone 13 Pro and iPhone 13 Pro Max share the same top-of-the-line camera system this year, and they are our pick as the iPhone for photos and videos. This time around, you don’t have to buy the biggest and most expensive model to get the best camera system — you get the same experience with either of the Pro models.

The three rear cameras — standard wide, ultrawide, and telephoto — combine with Apple’s image processing to produce stunning images, particularly in low light. If photo and video quality is your most important factor when buying a phone, the 13 Pro is where you should be spending your money.

The 13 Pro has a physically larger camera sensor compared to prior models that allows its main 12-megapixel camera to gather more light and produce better-quality images, especially in dark or challenging lighting conditions. Its ultrawide camera is able to take stunning macro photos, thanks to its new close focus capability. In addition, the 3x optical

zoom on the telephoto lens makes for great portrait photography. That larger sensor and the fact that it’s using sensor-based stabilization make for stable and beautiful videos, even in low light. You can even shoot and edit videos directly in ProRes on the iPhone 13 Pro (as long as you have a 256GB or higher storage model).

For those looking for the best Android camera system available, we recommend getting the $899 Google Pixel 6 Pro, especially if a telephoto lens is a must. We pitted the Pixel 6 Pro and iPhone 13 Pro cameras in a comparison video, and the results are pretty evenly split. While the Pixel 6 Pro’s video capabilities are still behind the iPhone, it can more than hold its own on stills, and its telephoto camera is even better than the iPhone 13 Pro’s.

Apple iPhone 13 Pro

The iPhone 13 pro shares the same camera system as the iPhone 13 Pro Max, but in a more compact body. It has a 6.1-inch screen, 128GB of internal storage (up to 1TB), and is powered by the new A15 Bionic processor,

Apple iPhone 13 Pro Max

The iPhone 13 Pro Max is a beast, with the best smartphone camera system of 2021. Weighing a hefty 8.46 ounces, it has a gigantic 6.7-inch OLED screen, the new A15 Bionic chip, and a battery that can handle all the 4K videos you throw at it.

Google Pixel 6 Pro

The Google Pixel 6 Pro is the larger sibling of the newest Pixel duo, with a 6.7-inch screen, 12GB of RAM, and a third camera featuring a 4x telephoto lens and 48 megapixels of resolution.

The iPhone 13 Mini has all the same cameras and features as its siblings but packs a smaller battery for light users. Photo by Vjeran Pavic / The Verge

4. Apple iPhone 13 Mini

Best small smartphone in 2021

There’s really only one reason to buy an iPhone 13 Mini, but it’s an important one: if you want a phone that’s easier to use in one hand or put into a small pocket. The iPhone 13 Mini is one of very few small phones on the market with top-tier features and specs; you don’t have to compromise in performance, build quality, or cameras with this one.

Though it’s much smaller in size than the other iPhones released this year, the Mini’s 5.4-inch screen is still big enough for text messaging, email, web browsing, apps, video, and games, and if you’re coming from an iPhone 6 / 7 / 8, it will feel quite spacious. But it’s also small enough that most adults, even those with small hands, will be able to comfortably reach all of the screen with their thumb. You won’t need a PopSocket on this one.

One important downside to a smaller phone: the iPhone 13 Mini has a smaller battery that probably won’t last a power user through a whole day without a charge. It’s really designed for a lighter user who isn’t glued to the phone all day. Otherwise, the Mini is the same phone as the iPhone 13: it has the same design, processor, cameras, 5G support, and build quality as the larger model. It’s just smaller and has a smaller price tag, at about $100 less.

If you prefer Android, the Asus Zenfone 8 is a good alternative. It’s a little bigger than the 13 Mini with a 5.9-inch screen, and it doesn’t work on Verizon, but it’s otherwise a very similar proposition: great build quality, top-notch processor, and high-end features like a 120Hz screen all tucked into a pocket-friendly device.

Apple iPhone 13 Mini

The iPhone 13 Mini has all the features and cameras of its bigger siblings, just in a smaller package. It has a 5.4-inch display, 128GB of storage, a smaller battery, and the same A15 Bionic chip as other iPhone 13s.

Asus Zenfone 8

For small-phone Android fans, the Asus Zenfone 8 is the perfect fit. It has a relatively tiny 5.9-inch display, 8GB of RAM, 128GB of storage, and a dual camera system (64-megapixel main camera with OIS and a 12-megapixel ultrawide).

Samsung’s Galaxy Note 20 Ultra has a built-in S Pen and a battery that can last two days. Photo by Vjeran Pavic / The Verge

5. Samsung Galaxy Note 20 Ultra

If you want a stylus built into your phone

If you’re looking for a premium phone with a stylus and amazing battery life, the Samsung Galaxy Note 20 Ultra is still the one for you. Because this device originally launched in 2020, and there are rumors that Samsung will be discontinuing the series in 2022, you might be able to score some deals for this device — if you can find one.

The Note 20 Ultra is a high-end phone in every other respect. Its giant 6.9-inch OLED display is 2K in resolution and supports a 120Hz refresh rate for smooth interactions. It is powered by the Qualcomm Snapdragon 865 Plus processor and 12GB of RAM, so it can perform without a hiccup. Together, these elements make the S Pen sing by cutting down

the latency between inking and what you see on-screen. While its triple rear camera system is not as good as the iPhone 13 Pro’s, it’s still one of the most advanced you can get. With its 4,500mAh battery, you can expect about two days of use before you’ll need a recharge.

Although you can technically use the S Pen with the Galaxy Z Fold 3, it isn’t built into the phone like it is here on the Note 20 Ultra. If you want your S Pen and phone in one clean color-coordinated package, you’ll need to get the Note 20 Ultra while it’s still available.

Samsung Galaxy Note 20 Ultra

The Galaxy Note 20 Ultra is one of Samsung’s top-tier non-folding phones, and it has excellent battery life.

One of the perks of the Samsung Galaxy Z Flip 3 is its 1.9-inch exterior screen for widgets and notifications. Photo by Dan Seifert / The Verge

6. Samsung Galaxy Z Flip 3

Best flip phone of 2021

Sick of smartphones that only get bigger and heavier when all you want is for some new ways to use your phone? Samsung’s third go at a flip phone seems to strike the right balance of whimsy, technical prowess and price that make the Galaxy Z Flip 3 appealing to mainstream users.

For $999.99, this 4.2-inch pocketable device can transform into a 6.7-inch 1080p OLED display that is bright and has a fast 120Hz refresh rate. The screen can also be used as a split screen for multitasking. When closed, you can use the 1.9-inch outer second screen, which displays handy widgets like app notifications and audio player controls without making you open the phone.

The Galaxy Flip 3 has the same Qualcomm Snapdragon 888 processor and 8GB of RAM as any other flagship phone released in 2021. Battery life is also just fine, providing between four and five hours of screen time between charges.

It’s too bad its dual cameras did not get an upgrade from the previous iteration. Both the 12-megapixel standard wide and ultrawide rear cameras, as well as the 10-megapixel front-facing selfie camera, take good but not great photos. Due to the Z Flip 3’s form factor, it can double as a mobile tripod for the cameras, which makes for some fun new ways to take photos.

Unlike the $1,400 Motorola Razr (2020), the Samsung Galaxy Z Flip 3 hits at just the right price and style point for it to mainstream the idea of a flip phone. It’s hard to say how durable this foldable screen will be, but at least you can be among the first to find out.

Samsung Galaxy Z Flip 3 (128GB) with free Galaxy Buds 2

Samsung’s Galaxy Z Flip 3 is a foldable phone with a non-foldable price tag. The unique, water-resistant device comes with a Qualcomm Snapdragon 888 processor and 120Hz display, as well as 5G support.

The TCL 20S has a fingerprint-resistant layer of
“micron-sized prismatic crystrals” that gives its back cover an understated shimmer. Photo by Gloria Sin / The Verge

7. TCL 20S

Best phone under $300 in 2021

Not everyone needs a premium flagship phone, and even a budget phone can be a delight to use these days. If your budget is sub-$300, and you are on the hunt for the best bang for your buck, the $250 TCL 20S will defy your expectations for what a budget should look and feel like.

You might recognize the TCL brand from its popular budget smart TVs, where its screen expertise is what makes the TCL 20S’s vibrant, 6.67-inch 1080p screen a standout. The 20S has a layer of fingerprint-resistant, “micron-sized prismatic crystals’’ on its back that gives it a subtle shimmer. It has a quick fingerprint sensor that is built into its power button, as well as face unlock as an additional security option.

While the 20S’s camera system is nothing to write home about, its 64-megapixel main camera and 15-megapixel front camera are both more than capable of taking detailed photos in good lighting conditions — just don’t use them for night or macro photography.

For a budget phone, the 20S has no noticeable lag in performance, thanks to its Qualcomm Snapdragon 665 processor and 4GB of RAM. By default, it comes with 128GB of internal storage, a microSD card slot, a 3.5mm audio jack, and a 5,000mAh battery that lasts for around two days without a recharge.

The TCL 20S is proof that even a $250 can buy a good phone without many compromises. It just nails all the basics that anyone would want from a phone: good performance, a good screen, good battery life, for a good price.

TCL 20S

A $250 phone can be a delight to use, too. This TCL 20S has a bright 6.67-inch 1080p screen, 128GB storage, and a 5,000mAh battery.

The Pixel 5A will receive three years of OS and security updates from Google. Photo by Allison Johnson / The Verge

8. Google Pixel 5A

Best Android phone under $500 in 2021

The Google Pixel 5A is a bit like the hidden track on the b-side of an album: those who are in the know love it, but most casual Android users may not even know it exists. It’s only available from Google’s online store because carriers don’t carry the Pixel 5A, but it’s worth the effort to get this hidden gem of a $450 5G phone.

The Pixel 5A has made some key upgrades from the discontinued Pixel 5: its screen is now a bit bigger at 6.3 inches, it has a slightly bigger battery at 4,680mAh, and it provides some dust and water protection (IP67). Otherwise, it has the same beloved camera sensor, Qualcomm Snapdragon 765G processor, 6GB RAM, as well as 5G connectivity (sub-6GHz 5G).

Like its predecessors, the Pixel 5A’s main claim to fame is its camera, which can go head-to-head with flagships that cost $1,000 or more. That’s because Google does so much of the image processing in software — the sensor itself is actually a few years old now. It means the Pixel 5A can take night photos, do astrophotography, and has a passable portrait mode. It can’t hang with the iPhone SE for video but beats it for photos every time.

One of the benefits of getting a Pixel is that it’ll be first in line for the latest Android updates. Google has committed to providing three years of OS and security updates to the 5A. Android 12 is already available for it, and it will be one of the first models to get the next version after that.

Google Pixel 5A

As the mid-range Pixel phone, the Pixel 5A features a 6.34-inch 1080p OLED, same best-in-class camera, with IP67 water resistance, and three years of software support from Google. You’ll be among the first to experience the latest Android build, like Android 12 that is already released for the 5A.

Third time’s the charm for the $1,800 Samsung Galaxy Z Fold 3, but it’s still too expensive for most. Photo by Dieter Bohn / The Verge

9. Samsung Galaxy Z Fold 3

Best folding phone of 2021

If you’ve been waiting patiently for the foldable phone to mature before dropping some serious coin for one, this might be the year to get the Samsung Galaxy Z Fold 3. (Microsoft’s dual-screen Surface Duo 2 is a distant second to the Fold 3, in this early two-device race.)

The Fold 3 is Samsung’s third-generation folding phone. Its main premise is this: it is sized like a skinny smartphone that fits in your pocket, but it unfolds to reveal a tablet-sized 7.6-inch display on the inside. That inside screen makes everything from reading books to

browsing the web to watching video to playing games more enjoyable and immersive. When you’re done using it, just fold it back up and stick it in your pocket just like any other phone. It also has an extra 6.2-inch screen on the cover with 2268 x 832 resolution, so you can use it for quick tasks when you don’t have enough time or space to unfold the main screen.

That flexibility is unmatched by any other phone you can buy right now, but it doesn’t come without a significant list of compromises. The Fold 3 is twice as thick when closed compared to normal phones, all its cameras are sub-par, and its 4,400mAh battery is a bit small to power so many screens. While the Fold 3 is water resistant (IPX8), the durability of its foldable screen and hinge remains an open question.

But the biggest compromise is its cost: the Fold 3 is roughly twice as expensive as other high-end phones. At $1,800, you’re still paying a lot for the ability to fold a tablet screen in half. If you’re willing to put up with those compromises for an experience that’s unlike anything else, though, the Fold 3 delivers.

Samsung Galaxy Z Fold 3 (256GB, unlocked)

The Galaxy Z Fold 3 is Samsung’s latest attempt at making foldable phones more mainstream. It’s expensive, sure, but it’s also more durable than previous models and comes with a 120Hz display and support for the once-exclusive S Pen. To qualify for this price cut, you need to activate the phone with a carrier on the day of purchase.

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