Mobile News: Nokia Siemens Networks Announces Business Plan to Improve Profitability

Nokia Siemens Networks decide to concentrate on mobile broadband and services as they launch worldwide restructuring program.

Chief executive officer of Nokia Siemens Networks, Rajeev Suri, said that the company is determine to become the leader in mobile broadband and services as they believe that the future of mobile technology is in these areas. He added that they also need to take important actions to achieve its goal in a very competitive telecommunications market.

Suri said that their goal is to offer the most efficient mobile networks in the world by maximizing the value of those networks and to provide services in order to maximize the capability of mobile networks. He added that their commitment to research and development is still in place despite the need for restructuring their company. They expect the increase of mobile broadband market in few years from now.

Nokia Siemens Networks feels the need to realign its business to focus on mobile broadband, customer experience management and services. Strengthening its highly-efficient global delivery system is also their main concern. Business areas which are not necessary for such strategy will be divested or managed for value. Major priorities will continue to focus on quality and innovation by having continued investment in both areas.

Nokia Siemens Networks plans to cut its non-IFRS annualized operating expenses and production overheads at the end of 2013 by 1 billion euros, compared to the end of 2011. The cut is expectedly to come mainly from organizational streamlining. The company will also target different areas including information technology, real estate and product and services procurement costs to lower costs further and improve quality.

The company targets to cut its workforce worldwide by about 17,000 by the fourth quarter of 2013. They plan to align the workforce of the company to their new strategy as well as to their productivity and efficiency measures. These planned measures are expected to include the elimination of matrix organizational structure of the company, site consolidation, transfer of business activities to global delivery centers, integration of particular central functions, cost synergies for the consolidation of wireless assets of Motorola, efficiencies in service operations, and process simplification in the company. Retraining and re-employment support of the most affected sites will be launch by the company to reduce the impact of the planned reductions.

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