Transforming Nokia: The Power of Paranoid Optimism to Lead Through Colossal Change
Risto Siilasmaa with Catherine Fredman
McGraw-Hill Education (October 2018)
In this book, written with Catherine Fredman, Risto Siilasmaa explains how paranoid optimism — “entrepreneurial leadership” — enabled him and h is associates to transform Nokia by formulating “a new vision for the future,” constructing “a strategy to implement the vision,” and building the balance sheet they were determined to achieve. Most transformation initiatives fail or fall far short of original expectations. Reasons vary, of course, but those who lead these initiatives must make exceptionally difficult decisions.
One of the major strategic objectives of a transformation is to “rightsize” the given organization. Siilasmaa cites three “massive transactions” that offer a case in point: Selling Nokia’s core mobile phone business to Microsoft, purchasing complete ownership of Nokia Siemens Networks (NSN), and acquiring Alcatel-Lucent. These were high risk/high reward decisions. For Nokia, that meant (in effect) swapping its Devices & Services business unit for full ownership of NSN and adding Alcatel-Lucent to its portfolio.
These are among the dozens of passages that caught my eye, also shared to suggest the scope of Siilasmaa’s coverage:
o Jorma Ollida behavior at a strategy meeting (Pages 69-73)
o Stephen Elop as CEO (79-92)
o Elop’s “Burning Platform” memorandum (105-110)
o Qualities of leadership (127-129
o Warning bells (132-134)
o Entrepreneurial leadership and Nokia (135-140)
o The power of paranoid optimism (139-140)
o Golden Rules for Nokia board of directors (144-149)
o Earning trust (152-154 and 278-279)
o Double whammy if Microsoft (161-163)
o Nokia Devices & Services acquired by Microsoft (169-233)
o Negotiations with Steve Balmer (175-182)
o Time runs out on Lumia (186-188)
o Backlash from Microsoft announcement (227-231)
o Creating Your Own Luck (289-293)
Andy Grove wrote a bestseller, Only the Paranoid Survive, that provides the title of my brief commentary. Here is another of his observations that is also directly relevant to the events at Nokia that Siilasmaa examines with rigor and eloquence: “There is at least one point in the history of any company when you have to change dramatically to rise to the next level of performance. Miss that moment – and you start to decline.” Grove calls it a “tipping point,” others call it “trigger point.” However you characterize it, Nokia’s deterioration reached one in 2012 and only an organizational transformation could save it.
With the assistance of Catherine Fredman, Risto Siilasmaa shares all of that gripping story in this book. Bravo!
Transforming Nokia [colon] The Power of Paranoid Optimism to Lead Through Colossal Change,
Risto Siilasmaa, Catherine Fredman,
McGraw-Hill Education, Andy Grove, Only the Paranoid Survive