Nokia reshuffles leadership, cuts 10,000 jobs

Finnish handset vendor Nokia has announced sweeping changes among its top ranks and pledged to cut a further 10,000 jobs by the end of 2013 as it adjusts the reality of life as a mid-table vendor. The firm also said that it will drop the prices of its Lumia smartphone range in a bid to stimulate more enthusiasm from consumers, and announced plans to licence its mapping technology to other industries.

The new round of redundancies will hit workers in Finland, where Nokia will close its manufacturing facility in Salo, and in German and Canada where R&D sites will also be shut down. Nokia said “IT, corporate and support functions” would be streamlined and non-core assets scrutinised for possible divestments.

One unit that has been hived off as part of the overhaul is Nokia’s luxury handset brand Vertu, acquired by private equity firm EQT VI—although Nokia retains a ten per cent stake.

Several long-serving senior executives have made way for new blood, most notably Niklas Savander, EVP Markets and Mary McDowell, EVP Mobile Phones. Savander has been with Nokia for 16 years, in that time managing the Mobile Devices unit, Enterprise Solutions and Technology Platforms. McDowell, meanwhile, joined Nokia to head the Enterprise unit in 2004.

Executives on the way up in this latest reshuffle include Juha Putkiranta as EVP Operations; Timo Toikkanen as EVP Mobile Phones; Chris Weber as EVP Sales and Marketing; Tuula Rytila as SVP Marketing and CMO; and Susan Sheehan as SVP Communications.

Since Stephen Elop assumed control of Nokia in September 2010, some observers have pointed towards a decline in the number of natives in senior positions at Finland’s biggest brand. The latest round of appointments goes some way to addressing this issue.

Gartner handset analyst Caronlina Milanesi accentuated the positive, saying that Nokia was evolving into a “slender more agile company focusing on opportunities to differentiate, such as imaging and maps.”

But Informa analyst Julian Jest described Nokia’s announcements as “drastic action” designed to “reverse its declining fortunes”.

In among the appointments and numbers, Nokia announced the acquisition of mobile imaging specialist Scalado. For more information on that deal, click here.

Nokia said it expects to incur restructuring charges of €1bn for the Devices & Services unit but warned that continued competitive difficulties would mean a worse than forecast performance for the unit. Nokia had previously forecast an operating margin of negative three per cent.

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