Nokia-in-House or Joint R&D (Jrd) with Foxconn Essay

745 Words Jun 6th, 2014 3 Pages
In-house or Joint R&D (JRD) with Foxconn? If JRD, to what extent should the JRD be? These questions need to be answered for the development of Nokia Denmark in surviving the increasingly competitive mobile device market. Therefore, thorough analysis of feasibility and compacts of JRD should be done, in terms of pros and cons. Due to limited space, most relevant and significant factors will be discussed.
For the positive aspect, JRD can benefit Nokia in the following aspects:
Effective Cost and Higher Efficiency: By making use of the competitive advantage for the low labor price in China and Taiwan, Nokia can achieve more effective resource allocation: with less investment to obtain higher efficiency, just as mentioned in the HBR case.
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Considering the pros and cons mentioned above, I would suggest Nokia Denmark adopting the third strategic options and continue the parallel organizational structure. To start with, discussion about Nokia will be done at the time stamp of the publication of this review in 2011 and no afterwards information about Nokia will be considered. From the review and the available information about Nokia, the main problem is the lack of core competency, which is operating system in Nokia’s case. Nokia has the best distribution network and was the largest mobile manufacturer in the world, meaning Nokia doesn’t have problem in delivering the product. The challenge is the design which is limited by the operating system. Apple has iOS and Google has Android. The review mentioned that Nokia will start partnership with Microsoft to operate most Nokia smartphones by Windows Mobile. This is definitely a good start in terms of enhancing core competency, though the approach is subject to debate: whether self-development or cooperate with other companies and further which company to work with. Given the limited information and limited time, there is no definite answer for which one to choose, while Android or self-development should be ruled out.
Come back to the three options, the first option to scale up the JRD with Foxconn is risking considering the two cons mentioned above. Higher level of outsourcing will lead to higher challenge to control the cost besides the

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