Strategic Issues Faced by Nokia

The strategy depends on the dimensions of the environment where it operates in, as mentioned earlier, which depends on the overall objectives of an organization.
Currently, Nokia operates in the mobile phone industry, which belongs to a larger portable consumer electronics industry. In order to find a key strategic issue for the company, we first analyze the first dimension of the environment: capacity.
Capacity is about the relative abundance versus scarcity in the company’s environment. In the case of Nokia, the mobile phone industry supports a huge capacity for growth, as the demand that determines the industry’s market potential is made by the increasing reliance of people on better electronic devices. Being part of the larger industry which is the portable music industry, the environment is abundant as the demand for consumer electronics is driven by greater reliance of people in electronic devices for their day-to-day lives.
This is a key strategic issue for Nokia: strategic marketing. As the environment provides more opportunities especially for incorporating other features to the mobile phone industry, Nokia is set to enter an overlapping industry within the portable consumer electronics industry as music has been included in the features mobile phone manufacturer offers.
With Nokia’s adoption of innovation strategy for its business-level strategy, the company is set to pursue innovation by constantly changing its products by adding more features, constantly redefining what a mobile phone is comprised of. However, this strategy pushes the company to compete indirectly in other markets within the portable consumer electronics industry, such as the market for music devices and markets for digital cameras.
The second dimension in the model is volatility, which is about the relative dynamism and stability in the environment.&nbsp.&nbsp.