Some companies have proven they can reinvent themselves, remaining current and agile despite supply chain disruptions. This is the case of Nokia Corp, a Finnish company founded in 1865 as a paper mill. The company’s evolution offers a broader lesson to the industry.
Nokia did not start manufacturing phones until 1982. The company’s interests and businesses were diverse: Telecommunications, consumer electronics, rubber, and cable kept it busy until 1992, when it gave its telecom business all its attention and focus and closed down the others. By making this strategic decision, Nokia became a global leader in telecommunications by 1998.
A history of adaptation in supply chain management
Industry experts have been fascinated by Nokia’s ability to manage and adapt its supply chain over almost 150 years. According to the experts, the secret is its supply chain management and its long-term relationships with its suppliers, which make the company ideal for case studies.
The Harvard Business Review published such a case study in 2012. Throughout the study, we learn how Nokia’s effective chain of command, its well-placed crisis plan, and an aggressive, multi-pronged strategy helped it avoid production losses for its new cellphone when a March 2000 fire damaged its entire supply of semiconductor chips at the Royal Philips Electronics plant.
Having a strategic risk management plan in place can help you avoid, or at least alleviate, financial difficulty. In a world where supply chain disruptions are simply inevitable, handling them successfully can lead to a happy. The Harvard Business Review case study contrasts Nokia’s supply chain management success with the not-so-successful ending the Swedish company Ericsson experienced (with serious financial consequences) when losing its semiconductor chip supply in the same fire delayed production of its new mobile phone.