Nokia's Network - Gaining Competitiveness from Co-operation

Jyrki Ali-Yrkkö

No 174 in ETLA B from The Research Institute of the Finnish Economy

Abstract: Nokia is a good example of a company whose operation is more and more based on co-operation with other organisations. During the past ten years Nokia has actively built and developed its supplier network. Rather than aim to produce everything itself, the company is increasingly turning to outside suppliers. Hence, the extensive orchestration of the supply chain has become an important factor helping the company gain competitive advantage. According to this study, many suppliers have positive experiences in co-operation, which has produced mutual benefits to both partners. The most visible fruit of co-operation is that companies grow fast not only in terms of net sales but also geographically. A number of suppliers have internationalised in the wake of Nokia. In addition to plants, they have also established R&D units abroad. Due to this global operation mode, the companies have been able to offer global services also to other customers, helping them obtain new clients. Moreover, co-operation has promoted know-how among the partners. Therefore, one important outcome of co-operation has been corporate learning. This knowledge accumulation does not include only technological issues but also information about market circumstances and the requirements of the market.

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