Product Line Management Analysis

By : Swapnil Deole, Marie PutriDecember 2011

What is Nokia?

Nokia is About Connecting PeopleIt is the world's largest manufacturer of mobile phones.

Offers much more: mobile devices and solutions for imaging, games, multimedia, mobile network operators and business.

Headquarter : Espoo, Finland

What is Nokia?

• Market share as 23% in the second quarter 2011

• Over 132,000 employees in 120 countries, sales in more than 150 countries

• Around 220 different phones (till 2011)

Source : http://darlamack.blogs.com

List of Nokia Product Family

Nokia 1000 series – Ultrabasic series

Nokia 2000 series – Basic series

Nokia 3000 series – Expression series

Nokia 5000 series – Active series

Nokia 6000 series – Classic Business series

Nokia 7000 series – Fashion and Experimental series

Nokia 8000 series – Premium series

Nokia 9000 series – Communicator series (discontinued)

List of Nokia Product Family

Nokia C series - affordable series (optimized for social

networking and sharing)

Nokia Eseries - enterprise-class series (business-

optimized smartphones)

Nokia Nseries - advanced smartphone series (with

advanced multimedia and connectivity features)

Nokia Xseries – for young audience (focused on music

and entertainment)

Product Line Strategy

Starting since 1994, Nokia :• created global platform, GSM 900 platforms

(2110, 8110 and 6110) – GSM 900 and 1800, primarily in Europe and Asia– 1900 MHz and TDMA 800, primarily in US and

South America– PDC (Personal Digital Cellular), primarily in Japan

Product Line Strategy

• Introduces lots of product in a short time

• Emphasizes aesthetic design, user interface and software features

• Use common designs across standards

• Concise Architecture-documents

Product Line Strategy

Source : J. Funk. Global Competition Between and Within Standards: The Case of Mobile Phones.

Advantages

• Effectively covers various price segments while maintaining lower development cost

• Improves efficiency to further development and manufacturing of products within each series

• Changes the competition from a single market to global level

• Creates a strong brand image, enables it to set prices that are based more on customer value than on cost

Excellent, but not enough

Problems

• Nokia products are not reaching intended customers, a clear mismatch between the product and its customer

• Variability needs in software are constantly increasing because– variability moves from mechanics and hardware to

software– design decisions are delayed as long as economically

feasible• ‘Here is a phone. Do you want it?’

Problems

• Victims of success: broadening scope of product families– Convergence leads to broader set of products– Success leads to unrelated products to be included in the

family• Too many products– The wide product portfolio results in customers being

thinly scattered across each product line• Buyers bargaining power is high– More choice of products with very limited differentiation– Elastic demand, buyers can delay buying new models

Solutions

• Focus on increasing the user satisfaction index

• Release less products but hit bulls eye

• Learn to know better about customer’s evolving tastes, needs and requirements

• Hierarchical Software Product Family

• Composition-Oriented Approach

Hierarchical Software Product Family

Hierarchical Software Product Family - Example

Composition-Oriented Approach

References• Bosch, Jan. Software Product Families at Nokia. Nokia

Research Center, 2005.• Funk, Jeffrey. Global Competition Between and Within

Standards: The Case of Mobile Phones. London, Palgrave, U.K., 2001.

• Funk, Jeffrey. The Product Life Cycle Theory and Product Line Management: The Case of Mobile Phones. 2004.

• http://www.janbosch.com/QoSA-Keynote0606.pdf• http://en.wikipedia.org/• http://www.slideshare.net/merragun/nokia-strategy-

3763661• http://www.nytimes.com/2009/10/19/technology/

companies/19nokia.html

Thank you