After Steven Elop’s announcement at Barcelona, the layoff plans have started, according to a memo disclosed by the Register yesterday. 3,000 Symbian engineers will be transferred to Acccenture and a further 4,000 will be laid off in stages. So a total of 7,000 workers will be laid off. Several sites including the Southwood, UK office and the White Plains, USA office will be closed as well.
This is the beginning and hopefully this will be the end of any massive restructurings but it looks like Nokia has a long road to go as it scales back from its Service and Software company vision. Nokia had pursued the long term goal of becoming a company centered on Software and Services, like Microsoft or Google leveraging its 1 billion user base. But with the massive layoff of software engineers it is being abandoned.
The vision wasn’t totally wrong but execution was bad. Now this time it looks like a similar case where the switch to Microsoft base operating systems doesn’t seem totally wrong but the execution is bad. Why would you announce Symbian’s death when you don’t have an alternative? It’s now April and when is the new Windows Phone coming? That’s probably October. So why make yourself vulnerable for at least 6 months?
Again software is getting to be more important in the era of smartphones and smart everything and you don’t want to let go of experienced engineers and later hire inexperienced novices. The layoff might have been necessary but the timing is not ideal and a relocation strategy should have been more effective in the long term.
April 28, 2011
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Team Counterpoint
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