Covers environment, transportation, urban and regional planning, economic and social issues with a focus on Finland and Portugal.

Monday, February 11, 2008

The Global Business

1. "Mainstream media" vision

Recently, Nokia, world largest manufacturer of mobile phones, announced that it would close its plant in Bochum (Germany) by the middle of this year in a cut that could reach up to 2300 jobs, and the transfer of the production to more competitive places in Europe.

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"We are transferring the production to existing plants, mainly in Romania, whose unit will open in the second quarter", said the spokesman of the company, Arja Suominen, stating that it had already begun the selection. [1]

In Europe, Nokia has factories in countries like Finland, Hungary and the United Kingdom, being a new factory in Romania in process of building, investment of around 60 million euros. It also has factories located in Brazil, Mexico, India and China. Last December, the company decided to move some of its production lines from Finland to South Korea.

According to Bloomberg, a German trade union considered this attitude "inhumane" and "socially unacceptable".

Also the Nokia Siemens Networks stated its intention to cut 9 thousand jobs, 15 percent of its total work force, by the end of 2010 (2290 from of Germany).

However, more recently, Nokia presented the financial results of the fourth quarter of 2007 with an increase of 44% net profit, totalizing US $ 2.6 billion. The long-term goal, to reach 40% of mobile phones market share, was also achieved in the period.

From October to December 2007 the net sales grew up 34%, to 15.7 billion euros. The company announced that altogether it sold more than 133 million of mobile phones, an increase of 27% compared with the same period of 2006.


* End of the synthesis of some information disseminated by the corporate media *

2. Vision defocused from the individual

The distances become irrelevant; the technology division tends to disappear globally; the productivity is globally harmonised; a global management develops; the nationality of the companies gradually loses importance; emerges a new middle class in Central Europe, Asia and Latin America; increases the competition between the systems of values of the industrialized countries vs. Asia and Central Europe; in the West heterogeneous societies coexist with different systems of values and concepts of social class; in Western Europe emerges rejection of the concept of professional mobility; China , India and Russia become technological powers. [3]

These trends are subjective factors taken into account by multinationals,when they plan the location of their production units on the world map, in order to obtain competitive advantages and financial profitability over the long term. In the case of Nokia, it wants to overcome their direct competitors, Samsung and Motorola, without reducing its profit margins.

This is the entrepreneurial vision of an management unit in a global economic system. A distant vision, defocused, “cold”, incomplete. But this is not the social reality of unemployment, a sum of thousands of avoidable individual tragedies, coexisting with a frantic capital accumulation, which no longer flows from the top (closed in itself) to the social basis. Today is Germany, tomorrow will be another selected country.

3. Vision focused on the individual

The exercise proposed in the following is suitable for the correction of social “myopia”. It’s about visualizing an extraordinary artwork of Chris Jordan, having the hope, like him, that "the images representing these quantities might have a different effect than the raw numbers alone, such as we find daily in articles and books". Running the Numbers - An American Self-Portrait by Chris Jordan[4]

It’s necessary that the decision makers see their investment models in different scales, including the human scale. The statistics are necessary approximations of reality, but represent intrinsically an abstraction that may deviate us from the social and human reality , transforming human beings into digits.

This post is the first part of the full article "Koistinen"

References:

[1] Nokia fecha fábrica na Alemanha e corta 2300 postos de trabalho, www.negocios.pt
[2] Nokia's Kallasvuo apologises to Germans, www.hs.fi
[3] IMD World Competitiveness Yearbook, www.imd.ch
[4] Chris Jordan, Running the Numbers - An American Self-Portrait, www.chrisjordan.com

Update:
Nokia Opens Factory in Romania
JUCU, Romania (AP) — Mobile phone maker Nokia Corp. opened a factory in Romania on Monday as part of a program to shift production to low-cost locations in ...

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1 comment:

james emmans said...

The mobile industry is very interesting and a fast moving, thanks for great blog