It hasn’t been that long since many pundits, self included, read the technology tea leaves and predicted the pressure on Nokia CEO Olli-Pekka Kallasvuo would end in a change at the top. Sure enough, I was just pointed to a MarketWatch article stating that OPK had resigned and was being replaced by Stephen Elop, a business executive coming from Microsoft.
I take neither pride nor delight in calling this one. I was certainly not the first to bring it up, and as I’ve said I highly respected Mr. Kallasvuo. But even if Nokia’s struggles the past few years were not his fault, directly or indirectly, it’s an unfortunate fact of the fast-paced business world that stockholders often need a sacrificial lamb in order to regain confidence. CEOs, right or wrong, make the most obvious target.
I don’t know much about Mr. Elop yet, but the brief blurb at MarketWatch sounds promising:
Elop currently heads Microsoft’s Business Division. Before joining Microsoft, Elop held senior executive positions in a number of US-based public companies, including Juniper Networks, Adobe Systems Inc. and Macromedia Inc. He holds a degree in computer engineering and management from McMaster University in Hamilton, Canada, which is his home country
The combination of technical and business savvy is exactly what Nokia needs to regain relevance. Of course, as always, execution will be the key.
As a stockholder I’m willing to give Mr. Elop the benefit of the doubt for now. There will be no overnight miracles, although I do expect a pop up in stock value in the very short term. Elop will need time to settle in, assess the landscape, and then start putting his stamp on Nokia.
Unfortunately, he does come with a bit of baggage. Microsoft’s recruitment of him involved a home-selling scandal that led to the company changing its relocation benefits policy. How this may (or may not) impact Mr. Elop’s acceptance by Nokia stockholders, trade customers and industry insiders remains to be seen.
Nokia and Microsoft have enjoyed an interesting competitor-collaborator relationship for some time now. Elop’s ship-jumping could serve to push that one way or the other. I’m sure Microsoft’s rich experience in software and gaming play well into Nokia’s strategy and that there’s an expectation Elop will add to needed strengths. I’m particularly curious to see if there’s an impact on troubled web service Ovi and the upstart operating system formed jointly with Intel, MeeGo. No doubt we will see some decisive moves on several fronts by the end of this year.
What this change means for the company’s US presence (now teetering at the precipice of Non-Existant) is still highly speculative, but Nokia’s choice of reaching outside of Finland for chief executive leadership is in and of itself a stunning move that hints at increased US interest at least. Combine that with the company’s recently renewed focus on Silicon Valley, and we may finally witness the US-oriented assertiveness promised, but not delivered, since the mid 2000s.
Wait and see.