It is tempting to lay the blame for Nokia’s demise at the doors of Apple, Google and Samsung. Nokia had begun to collapse from within well before any of these companies entered the mobile communications market.
Nokia’s leaders were aware of the importance of finding what they called a “third leg” – a new growth area to complement the hugely successful mobile phone and network businesses. Their efforts began in 1995 with the New Venture Board but this failed to gain traction as the core businesses ran their own venturing activities and executives were too absorbed with managing growth in existing areas to focus on finding new growth.
Nokia also got trapped in its Symbian OS ecosystem. By 2009, Nokia was using 57 different and incompatible versions of its operating system.
Nokia’s decline in mobile phones cannot be explained by a single, simple answer: Management decisions, dysfunctional organisational structures, growing bureaucracy and deep internal rivalries all played a part in preventing Nokia from recognising the shift from product-based competition to one based on platforms.
Read more at https://knowledge.insead.edu/strategy/the-strategic-decisions-that-caused-nokias-failure-7766#XFxjbOup1fAv9Yyk.99
Interesting article on how China is looking more and more to become self-reliant and independent industrially. Its huge domestic market is becoming more important to Chinese growth. But beyond even that, Beijing’s entire economic strategy is designed to replace critical foreign technology and products with homegrown alternatives it can control. Simply, the Communist Party prefers Chinese to buy Xiaomi phones and Geely cars, not iPhones and Buicks.
That’s exactly what the much-feared “Made in China 2025” program is all about. The plan is to develop new, high-tech industries to compete with and eventually replace foreign rivals, at home and abroad. In that sense, it’s official policy to limit overseas involvement in the economy.
Read the full article at https://www.bloomberg.com/view/articles/2018-09-09/china-s-far-from-desperate-to-make-a-trade-deal-with-trump
Following the previous article, here is another one which takes a bleaker view of China's future.
On the macro level, China’s growth is likely to continue to decelerate, owing to rapid population aging, high debt levels, maturity mismatches, and the escalating trade war that the US has initiated. All of this will drain the CPC’s limited resources. For example, as the old-age dependency ratio rises, so will health-care and pension costs.
Like the Soviet Union, China is paying through the nose for a few friends, gaining only limited benefits while becoming increasingly entrenched in an unsustainable arms race. The Sino-American Cold War has barely started, yet China is already on track to lose.
Read the full article at https://www.project-syndicate.org/commentary/china-cold-war-us-competition-by-minxin-pei-2018-09
Very good coverage of Raghuram Rajan's letter to the Parliamentary committee on bank loans
Read the full article at https://www.thequint.com/news/india/raghuram-rajan-letter-on-bad-loans
A peek into how Google can fail. The reliance of Google on ads for revenue will meet a stumbling block when more and more searches move to voice and non-screen based devices like Alexa or Google Home.
A wonderful walk down memory lane to look back over 30 years of making charts and maps for The Economist
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