The paper "Microsoft Acquisition of Nokia " is an outstanding example of a business case study. This research is significant because it discusses and analyzes various risk issues concerning the case of Microsoft acquiring Nokia. The acquisition of Nokia devices and services cost Microsoft Corporation $7.2 billion, and this was considered as the greatest move towards strengthening the market of Microsoft phone markets across the globe. This step as well was in response to the domination of the global markets by the devices and applications running on the Android operating system and iOS. The purpose of the research is to cover three main sections namely; core risk principle, risk theme discussion, and recommendations.
The core risk principle introduces the whole issue of risk associated with the case of Microsoft acquiring Nokia devices and services. As well, this section summarizes the relevance of the risk theme. Then it ends up with the identification of the underlying problems in the case study. The second section is the primary part of the work. Firstly, the section covers the theme by discussing issues such as when the incidence occurred, how and why it happened.
Then it also includes various solutions that are identified. The last section is the recommendation and conclusion of the case study. It summarizes the issues identified as well as the identified solutions. One of the most imperative methods used in the research is the analysis of the available information authored by various scholars and researchers. The primary sources of information utilized include journals, academic books, case studies, and lecture notes. The findings or the results of the research indicated that it is crucial to understand that every organization in business strive for growth and development.
As a result, like Microsoft acquired Nokia devices and services, various companies have adopted different mechanisms to achieve the desired success. Most of the successful organizations have adopted change and restructuring of various processes to exploit the existing advantages and strengths. In conclusion, the research portrayed that one of the most significant and applied strategies for success is Mergers and Acquisitions (M & A), which has substantially structured various industries and the marketplace. The acquisition of Nokia services and Devices by Microsoft is one of the most popular and recent forms of merger and acquisition deals. Core Risk Principle One of the main concepts, in this case, is the risks associated with the restructuring of Microsoft.
Corporate restructuring is one of the business strategies that are aimed at primarily increasing the company’ s long-term profitability. Several key issues must be expounded between the two companies. Firstly, it is crucial to comprehend that Nokia Corporation operates a business in four main categories namely; enterprise solutions, mobile phones, multimedia, and networks.
There are several reasons Microsoft opted for this acquisition. One of the most significant objectives was to remain competitive in the global market. The growth and development in the technological advancements and innovation are ever-expanding, and companies such as Apple Inc. have substantially incorporated it. The main risk that Microsoft faced in this acquisition is the associated uncertainty associated with the whole strategy. Financial analysts indicated that they were very uncertain about the expected income generated by Microsoft after acquiring Nokia Corporation. As well, the other risk involved the satisfaction of the needs of the shareholders.
Other financial analysts saw this as a potential opportunity for Microsoft Company. According to Shri Dharmasthala Manjunatheshwara Research Centre for Management Studies (SDMRCMS); “ Empirical evidence suggests that of all the mergers and acquisitions (M& A), ¾ ends up being failures” (SDMRCMS, 2015). Therefore, this raises the big concern whether Microsoft was aware of this statistic which makes the whole endeavor very risky.
Amanda, H. C. (2014). The Microsoft-Nokia Strategic Alliance. University of Warwick, U.K.
Armstrong, A. K., Mueller, J. J., & Syrett, T. (2014). The smartphone royalty stack: Surveying royalty demands for the components within modern smartphones. Available at SSRN 2443848.
Ali-Yrkkö, J., Kalm, M., Pajarinen, M., Rouvinen, P., Seppälä, T., & Tahvanainen, A. J. (2013). Microsoft Acquires Nokia: Implications for the Two Companies and Finland. ETLA Brief, 16(3).
DePamphilis, D. (2009). Mergers, acquisitions, and other restructuring activities: An integrated approach to process, tools, cases, and solutions. Academic Press.
Lin, F., & Ye, W. (2009). Operating system battle in the ecosystem of smartphone industry. In Information Engineering and Electronic Commerce, 2009. IEEC'09. International Symposium on (pp. 617-621). IEEE.
Samridhi, S. (2015). Corporate Restructuring: A Case Study Of Microsoft Acquires Nokia. International Journal of Science, Technology & Management.
Shri Dharmasthala Manjunatheshwara Research Centre for Management Studies (2015). Microsoft’s Acquisition of Nokia’s Mobile Business Unit. Cases in Management Volume 4 (2015)’ with ISBN 978-93-83302-14-7