In a recent Wall Street Journal (WSJ) article, it was reported that back in the year 2000, Nokia chief designer Frank Nuovo gave a presentation to wireless carriers and investors that showed a phone with a color touch screen capable of going out to the internet and accessing any information the user was interested in. This was seven years before the launch of the iPhone by Apple.
The WSJ article notes: “Consumers never saw that product. It was a casualty of a corporate culture that lavished funds on R&D but squandered opportunities to bring innovations to the marketplace. Nokia’s R&D was fragmented by internal rivalries and disconnected from the operations that actually brought products to market.” For example, Alastair Curtis, a Nokia product designer at the time, commented recently: “We were spending more time fighting politics than doing design.”
During this period, Nokia had two operating system (OS) groups. One was trying to upgrade their existing cell-phone OS called Symbian to work well on smartphones, and a second group was working on a totally new OS called MeeGo. The WSJ learned: “people involved with both efforts say the two teams competed for support within the company and the attention of executives. Even worse, decisions were made by have meetings with about 100 engineers brought in from Nokia facilities from around the world for three day sessions.”
Today, Nokia is fighting to avoid bankruptcy. They are trying to catch up in smartphones but likely won’t make it. The Chinese are taking over the low end cell phone business with low price phones with some smartphone features.
What do we learn from this? Here are a few tips that I believe are very important:
Funding: Spend wisely, not excessively. Apple R&D spending was 25% of Nokia’s in the last 10 years.
Personnel: Put top people on key projects; people who have many battle scars and are tough and stubborn.
Organization: For a particular area/product, keep the team very small and totally protected from the rest of the company. Steve Jobs took pride in keeping his key product teams totally secret from the rest of Apple so they wouldn’t get sucked into meetings and showered with “advice.”
Decision Making: Make it clear who the decision maker is and avoid consensus decision making involving a lot of extraneous people.