MBA (2009-2011) - 1st SEMESTER (A)

MANAGERIAL ECONOMICS

TOPIC:- Demand Analysis of Various Nokia

Products and Demand Forecasting of Nokia.

PRODUCT:- NOKIA

PREPARED BY GROUP – L

SUBMITTED TO SUBJECT INCHARGE

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 INDEX

 HISTORY OF NOKIA…………….…………….....03

 RESEARCH AND DEVELOPMENT……………..04

 PRODUCT ANALYSING (SURVEY)

…………….05

 INTRODUCTION OF DEMAND
FORECASTING……………………………………
07

 FORECASTING BENEFITS……………................08

 METHODS OF DEMAND
FORECASTING……...09

 SWOT……………………………………................12

 NOKIA’S FUTURE..
…………………….................15
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 HISTORY OF NOKIA

Nokia's history spans more than a hundred years and contains many stories,
events and milestones brought about by the many twists and turns of the
world history and industrialization. Get ready to read about the varied
development of the Nokia Group!
In this presentation, Nokia's history is divided into five main areas:
Timeline, Directors, Businesses, Milestones and Nokia in Figures.
Nokia's history is a reflection of the development of Finnish industries from
forestry-oriented basic production to high-tech prominence. Nokia's journey
of over hundred years has had an abundance of choices. After several
rounds of mergers and divestments, investments and downscaling, Nokia
finally focused its resources on developing wireless telecommunications
with an unparalleled success. During the early years, the directors were
often the founders of the companies. The first decades were spent on
growing and developing the companies in spite of the hardships of the
Famine Years, World War I, the struggle for independence and many other
problems.

2009: A new President and CEO – Nokia today

Olli-Pekka Kallasvuo becomes Nokia’s President and CEO; Jorma Ollila

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 becomes Chairman of Nokia’s board. Nokia and Siemens announce plans
for Nokia Siemens

RESEARCH & DEVELOPMENT

After the merger of 1966-67, Nokia increased its investments in R&D. The
new multi-industry group also facilitated better planning of corporate
strategies and fields of business. An independent research center was
established in 1986 to supplement the R&D work carried out at different
businesses
The new center was appointed the task of refining latest international
information on new technologies and R&D processes for the business units'
needs.
In 1999, R&D activities were carried out in 44 centers and 12 different
countries, in addition to the Nokia Research Center. While R&D costs in the
early 80s amounted to 2-5% of Nokia's turnover, by 2002, this figure had
increased to 10.2%, with 38% of Nokia's employees (approximately 20,000)
working in R&D centers in 14 different countries.
Investments in Education and Training
In the 80s, CEO Kairamo paid much attention to issues related to
international education policies as well as co-operation between the industry
and universities. The need for a skilled workforce increased rapidly with the
emerging telecommunications industry.

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DEMAND ANALYSIS OF NOKIA

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 NOKIA MOBILE PHONES BY SERIES
Nokia 1000 series 1011 · 1100/1101 · 1110/1110i · 1112 · 1200 · 1208 · 1600 · 1650

Nokia 2000 series 2110i · 2115i · 2310 · 2600 · 2600 classic · 2610 · 2626 · 2630 · 2650 ·
2651 · 2700 classic · 2760

Nokia 3000 series 3100/3100b/3105 · 3110 · 3110 classic · 3120 · 3120 classic · 3155 ·
3200/3200b/3205 · 3210 · 3220 · 3230 · 3250 · 3310 · 3315 · 3330 ·
3410 · 3500 classic · 3510/3590/3595 · 3510i · 3600/3620/3650/3660 ·
3600 slide · 3720 classic

Nokia 5000 series 5070 · 5100 · 5110 · 5130 · 5200 · 5210 · 5220 · 5300 · 5310 · 5320 ·
5500 Sport · 5510 · 5610 · 5700 · 5800

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Nokia 6000 series 6010 · 6020/6021 · 6030 · 6070 · 6085 · 6100 · 6101 · 6103 · 6110/6120 ·
6110 Navigator · 6111 · 6120/6121/6124 classic · 6131/6133 · 6136 ·
6151 · 6170 · 6210 Navigator · 6220 · 6220 Classic · 6230 · 6233 ·
6255i · 6260 Slide · 6265 · 6270 · 6275i · 6280/6288 · 6290 · 6300 ·
6300i · 6301 · 6310i · 6315i · 6500 classic · 6500 slide · 6555 · 6600 ·
6600 fold · 6600 slide · 6610i · 6620 · 6630 · 6650 · 6650 fold · 6670 ·
6680 · 6681/6682 · 6730 · 6700 classic · 6720 Classic · 6800 · 6810 ·
6820 · 6822

Nokia 7000 series 7110 · 7160 · 7210 Classic · 7250 · 7280 · 7360 · 7380 · 7390 · 7500
Prism · 7600 · 7610 · 7650 · 7700 · 7710 · 7900 Prism

Nokia 8000 series 8110 · 8210 · 8250 · 8310 · 8600 Luna · 8800 · 8850 · 8910

Nokia Communicator 9000/9110/9110i · 9210/9290 · 9210i · 9300/9300i · 9500

Nokia Eseries E50 · E51 · E52 · E55 · E60 · E61/E61i · E62 · E63 · E65 · E66 · E70 ·
E71 · E72 · E75 · E90 Communicator

Nokia Nseries N70 · N71 · N72 · N73 · N75 · N76 · N78 · N79 · N80 (Internet Edition) ·
N81 (N81 8GB) · N82 · N85 · N86 8MP · N90 · N91 (N91 8GB) · N92 ·
N93 · N93i · N95 · N95 8GB · N96 · N97 · N97 mini

Nokia Xseries X3 · X6

Internet Tablet 770 · N800 · N810 (WiMAX Edition) · N900

Other N-Gage (Classic · QD · QD Silver Edition) · Vertu luxury phones

Concept Nokia Morph · Nokia Eco Sensor · S60

INTRODUCTION TO DEMAND
FORECASTING
The concept of matching supply with demand is straightforward. Just strike
the right balance between what your customers want and the inventory
investment required to meet that demand.
Of course, it's not that easy. Buying too much wastes time, money and space
—and exposes you to potential losses from liquidating overstocks.
Underestimating demand leads to backorders, cancellations and unsatisfied
customers who turn to your competitors.

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Manhattan Associates' Demand Forecasting manages the balancing act
between minimizing inventory investment and optimizing revenue
opportunities. It provides a sophisticated, yet easy to use solution to the
forecasting challenges that overwhelm many companies. Consider the
complications the forecaster faces in anticipating demand, accurately and
efficiently:
 Seemingly infinite combinations of locations, products and
forecasting models
 The differing time horizons and forecasting methods for assortment
planning, financial planning and replenishment planning
 The cleansing of historical demand
 Seasonal profiling
 Forecast exceptions
Demand Forecasting overcomes these challenges by providing a single
source for statistical demand forecasting throughout the enterprise. Demand
Forecasting does the heavy statistical lifting to provide the best trended,
seasonally adjusted forecast possible. This frees planners and buyers to
concentrate their time on the fine points of merchandise planning and
inventory optimization to make profit for the company. And use it to
generate and maintain appropriate forecasts at different levels of product
and location. Demand Forecasting is synchronized with Financial Planning,
Item Planning, Assortment Planning and Inventory Optimization.

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The better a company can assess future demand, the better it can plan its
resources. Each company is exposed to three types of factors influencing
demand: company, competitive and macroeconomic factors.
Company factors include market share trends, changes in strategy and
implementation, changes in brand value. Competitive factors include
competitor advertising, competitor product offerings, market share.
Macroeconomic changes include income, economic growth and shocks.
There are several methods to assess and forecast demand. None yields
demand numbers that are a 100% guaranteed. However, using more than
one method improves accuracy and confidence levels. Most companies use
Simple Sales Analysis and Forecasting. Most companies also use Market
Size and Market Share Research. One of the most accurate method used
today is the combination of Market Size Research and Mind Share
Research.

Forecasting is the process of estimation in unknown situations. Prediction

is a similar, but more general term, and usually refers to estimation of time
series, cross-sectional or longitudinal data. Risk and uncertainty are central
to forecasting and prediction. In more recent years, Forecasting has evolved
into the practice of Demand Planning in every day business forecasting for
manufacturing companies. The discipline of demand planning, also
sometimes referred to as supply chain forecasting, embraces both statistical
forecasting and consensus process.
Forecasting is commonly used in discussion of time-series data.

FORECASTING BENEFITS

Save time, money, and effort with:

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  Reduced inventory
 Increased sales and capacity
METHODS OF DEMAND FORECASTING

1. CONSUMER SURVEY METHOD:

The consumer survey method, as the name suggests involves
questioning the consumers with regard to his buying plans for the future
time period. This method is also known as survey of buyers intention and
opinion survey method. According to this method, the consumers are either
directly interviewed or questionnaires are mailed to them. So as to elicit
their future interviewed or questionnaires are mailed to them. So as to elicit
their future intentions to buy. Generally, households plans their future
purchases of consumer durable’s such as CTVs, refrigerators, designer
furniture, kids furniture, etc.

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 Consumer surveys are also conducted to find out the level of
satisfaction derived from the existing range of given product and these
substitutes so that appropriate changes are made in the product designer,
Usefulness and quantity. Similarly, when new products are launched,
samples are distributed amongst the consumers. This is particularly true
about consumers non-durables such as shampoo, toilet soaps, toothpaste’s
and detergents. After distribution of such products, the reaction of the
consumers are documented and studied to estimate the extent of future
demand for the product.

2. EXPERT OPINION OR DELPHI METHOD:

Expert opinion methods as a name suggests is a method whereby

opinions of the experts in the field of demand forecasting is sought by firms
who are planning to launch a new product or increase the production of an
exiting product. Such experts may be in – house or services may be hired
from outside experts consultancy firm and market research organization.
The veracity of such an expert opinion can be confirmed by a number
of methods. One such method is known as a Delphi method. It is
macroeconomic method of forecasting.

3. MARKET EXPERIMENTS :

Market experiments refer to the market studies and market

experiments in the field of consumer behavior conducted under real but
controlled marked conditions. Representative sub markets with
homogeneous feature in terms of population, income levels, social and
cultural composition, occupational distribution, task and preference, etc. are
chosen. Variables such as price, advertisement outlays are controlled and
introduced in the sub market to measure their impact on total demand. On
the basis of information collected, the elasticity of demand is computed and
the future demand for the given product is estimated.

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 Market studies and experiments can be classified into two types,
namely: test marketing and controlled experiments. In case of test marketing
a representative sub market is chosen where the given product is introduced.
More than one test area can also be chosen, if more varieties of given
product are to be introduced in the sub-market. By doing so, the firm can
study the impact of different demand determinants in different sub-markets
and chose the more effective market strategy.

Controlled experiments and conducted to find out the demand for a

new product and its varieties under different brand names.

4. TIMES SERIES ANALYSIS:

Times series analysis is the study of movements of

variables through time. The effective use of time series analysis in
forecasting demand requires a reliable time-series data base. It is
assumed that the factors responsible for the past trends in the
variable to be projected will continue to hold good in future in a
similar manner. As the data available to firm relates to a time
period, there are bound to be fluctuations which can be attributed
to a general tendency. Such data is known to reveal a secular
trend. If the fluctuation in the data are on account of weather or
climatic changes, they are known to be a seasonal variations.
Business fluctuations or trade cycle are caused fluctuations in the
data and they are known as cyclic variations. Changes on account
of natural intervention such as earthquakes, famines, floods, etc
are known as random variations. However, in the time series
analysis, only secular trend is analysis as an authentic quantitative
method is available to analyze non-secular trends.

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MICROECONOMIC STATISTICAL TIME-SERIES
ANALYSIS

Sales numbers from several time periods are correlated to one or several
factors such as price, advertising, market share, competitor price
demographics, product life stage, etc. Regression analysis and curve fitting
is then used to predict future demand.
The advantage of this method is that it includes relevant strategy as well as
competitor and macroeconomic trends. The disadvantage is that the
outcome may be biased because of important variables being left out,
variables not being completely independent, new competitive actions not
being included.

MACROECONOMIC STATISTICAL TIME-SERIES

ANALYSIS

This method is a macroeconomic statistical time-series analysis and purely

quantitative in nature. It fits linear and nonlinear curves into time series and
then extrapolating future values. Time series may be correlated to identify
leading and lagging indicators. The advantage of this method is that
recurring trends can be captured and extrapolated easily.

SWOT ANALYSIS

STRENGTHS

 Versatility: your ability to adapt to an ever changing environment.

 Growth: your ability to maintain a continuing growth.

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 Markets: your ability to penetrate or create new markets.

 With the help of consumer survey method, we are able to make

survey for Nokia and we get the positive feedback.

 Nokia as product for demand forecasting help to do better forecasting

due to name and fame.

WEAKNESS:

 Correction of an identified defect.

 Protection through cover-up and prevention strategies to reduce the

exposure of your weaknesses.

 Aggression to divert the attention from your weaknesses.

 We had chance consumer survey method to help, it is very time

consuming.

OPPORTUNITIES:

 We get the opportunity to analyze the product, its demand and various

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 comment on the product.

 To know detail about the demand including forecasting techniques.

 Marketing warfare: attacking the weak leader's position and focusing

all your efforts at that point, or making a surprise move into an
uncontested area.

 Collaboration: you can use your complementary strengths to establish

a strategic alliance with your competitor.

THREATS

 From our survey report we found that Nokia has high level
competition with Sony Ericsson.

 Nokia is not only facing the competition with Sony Ericsson but also
facing the Reliance, Motorola, other mobile companies also.

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 NOKIA’S FUTURE

As mobile usage grows in the world’s emerging markets, Nokia will

continue to develop affordable mobile devices that can contribute to
increased economic growth and quality of life.
At the same time, mobile communications is converging with computing,
digital imaging and the internet, making it possible for people to use
handheld devices for filming video, listening to music, playing games,
surfing the web and more. Nokia is shaping this converging industry,
pushing it forward with cutting-edge products and the development of open
standards.
Nokia’s success story is built on constant innovation. Our very human
technology is all about enhancing communication and exploring new ways
to exchange information. That’s why Nokia will never stop finding new
ways of connecting people.

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