Ericsson in the New Millennium

            
 
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Case Details:

Price:

Case Code : BSTR128 Electronic Format: Rs. 400;
Courier (within India):Rs. 25 Extra
Business Strategy | Case Study in Management, Operations, Strategies, Business Strategy, Case Studies

Themes

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Case Length : 13 Pages
Period : 1990 - 2004
Organization : Ericsson
Pub Date : 2004
Teaching Note : Available
Countries : Global
Industry : Telecom

Abstract:

Ericsson, enjoyed immense success until the 1990s. The company was amongst the pioneers in the telecom industry. Yet, it could not adapt to the changes in consumer tastes and preferences in the late '90s. Ericsson failed to adapt its mobile handsets to consumer tastes, and this led to a fall in sales of its handsets. Its competitors meanwhile took over Ericsson's space in the market. As sales fell, Ericsson's other businesses were also affected. Finally the company adopted some tough measures to restrict the downslide in its sales. Ericsson understood that it was a company that was good at manufacturing good quality and high technology equipment, but was not good at marketing its products to individual customers.

Therefore Ericsson entered into a joint venture with Sony to form Sony Ericsson, as its new mobile handset unit. Ericsson also restructured itself. Unprofitable or unmanageable businesses were sold off and some new companies were acquired to fill in the gaps in its product range. Eventually, in 2003, the company once again registered profits.

Issues:

To study the strategies that Ericsson used to turnaround

To understand the factors that caused the slide of a successful company

To understand how important it is even for a successful company to keep changing with changing times

To understand the importance for a company to be more customer-centric and less product-centric

To understand the strategies that a company has to use if it wants to be successful in competitive times

Contents:

  Page No.
Introduction 1
Vision, Mission and Values 2
1990s: Beaten by the Competition 3
Slow to Change 3
The Early 2000s: Restructuring 5
Turnaround 8
Exhibits 10

Keywords:

Case Ericsson, Mobile Handsets, Nokia, Motorola, Cisco Systems, Sony-Ericsson, 3-G Technology, Telecom Industry, Innovation, Ownership Structure, andelsbanken, Wallenberg family, LG, Samsung, Flextronics

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