Interview Operation Elop, a new book on Nokia, got plenty of attention last week, with its suggestion that Nokia’s former CEO was the “worst CEO in history”. After I ridiculed the idea that Elop alone was solely responsible for Nokia’s crash, co-author Pekka Nykänen got in touch to say that isn’t quite fair. So we invited him to talk about what he had found.
“There’s a few things I’d like to tell you that are not mentioned in the international coverage of our book,” says Nykänen.
“We feel that Elop didn’t tell the truth about Nokia’s options at a time," Nykänen opined. "From the negotiations with Google – Elop said Google only offered the standard ‘Welcome to Android’ conditions. But actually, Google did have some unique propositions for Nokia. Google would have bought patents from NOK – and those would have benefited Android.”
Good for Google no doubt, perhaps less so for Nokia. What else?
“Nokia was good at developing new markets and Android was going down in price it would have been a perfect alliance,” says Nykänen. “Nokia would have been the best to deliver it.”
The authors got the idea that Google would have been ready to change its roadmaps to accommodate Nokia.
A corpse rots from the head down
One area where blaming Elop was unfair is how badly Microsoft let Nokia down. It wouldn’t allow Nokia much (if any) customisation; it wouldn’t change its roadmap; its roadmap caused problems with Nokia’s first phones (which couldn’t be updated to Windows Phone 8, which appeared a few months later); and it was out-developed by Google, which added features to Android far quicker. The result was that Nokia had hardly anything to sell for two years.
Nykänen doesn’t disagree. “Nokia could have done anything with Windows Phone,” he says. If it had been allowed to, “they had the best talent to do that. Microsoft was so inflexible to the interests of Nokia, it was totally the wrong match when Windows Phone was selling in the high price point”.
And he agrees the rot set in long before Elop arrived.
“Yes, the responsibility lies heavily there. The organisation got bloated, and the matrix organisation structure meant that everything was in committees, nobody made decisions, and nothing happened. The decision to put touch on top of Symbian was stupid because it kind of closed the gate to any really changes,” he told us.
“The CEO should have been changed earlier and Symbian should have been dismissed earlier.”
Nykänen also highlights the role of Elop’s McKinsey guru - Endre Holen.
“The Burning Platform memo is an old McKinsey thing. Elop invited Holen to sit in on all the management and leadership team meetings. Nokia had 200 people working in strategy but the results were not very good and McKinsey took some of the work, that department was then cut down heavily after Elop arrived.”
Anything positive to say for Elop?
“He had some very good qualities too – and he was a great motivator inside the company. He opened up the culture, which was paralysed after OPK [Olli-Pekka Kallasvuo]. Elop made the company act again – it started to move fast, and customers and operators were happy with the way he worked,” said Nykänen.
“He responded to emails all night. He worked like a maniac. This is also one of the reasons we are sure he was not a Trojan Horse. What was the motive to even have this Trojan Horse inside Nokia? A successful Windows Phone would have been better for Microsoft and better for Elop, it would have made his career.”
The staff interviewed by the authors also found the Canadian “fitted into the Finnish atmosphere well – he was quite humble.. and interested in ice hockey which we like,” but ultimately said he “made very poor decisions.”
As for the sale, Nykänen thinks it was a coup for Nokia:
“They were running out of money,” he notes.
And Microsoft didn’t really want to buy the phones division, but didn’t have a choice not to: it may have lost the OEM that generated over 90 per cent of platform sales. “It was not an easy decision but it was clever. Nokia’s share price has subsequently more than doubled.”
Kallasvuo, Elop’s self-deprecating predecessor, gave an interview earlier this year where he said the circumstances were unprecedented:
“Google and Apple were strong in industries outside mobile communications, who suddenly enter and in a couple of years become market leaders where they have never been before. That is unique in the business history of the world.
“The strategy was correct. The execution very often was difficult, some people, the skills were missing and you have to acquire them…Without good execution even a good strategy is worthless,” he told his interviewer.
The authors of Operation Elop tell us an English translation is on its way. ®