Finland Case Strategic and Competitiveness Essay

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Day 3 Assignment Finland. 1. How was Finland as a nation able to move from a sleepy economy to one of the most competitive nations in the world by the end of the 1990s? Answer: Finland invested a lot in Research and Development. In 1980s Research and Development costs increased by 10%. National Technology agency and other different agencies were created to implement research policy that stimulated technological progress. Rigid financial market regulations were relaxed, financial market were liberalized, so banks could lend easier. Access to international capital markets became easier. Public spending on education was higher in comparison with other European countries. All these factors stimulated technological companies such as Nokia to progress in production of new products. 2. What allowed Finland to become a world-leading nation in the mobile communications cluster? Why did this cluster develop in Finland rather than other fields? Answer: Unlike in most other European countries, the Finish telephone network was never monopolized by the state. The deliberately fragmented market structure reflected security concerns dating back to the late 19 century when Finland was a Russian Grand Duchy. At the time the Finnish Senate had granted many licenses for the telephone operations in order to complicate any effort by the Tsar to seize the telephone system. Finish Operators who were quite advanced technologically engaged in R&D cooperation with equipment manufacturers. In 1981 an analog of NMT network was introduced by Nordic Telecom Conference. The introduction of NMT marked the start of a fast expanding new industry. 3. How did the Finnish firm Nokia become the world leader in mobile handsets? How did its home base in Finland influence Nokia’s success? Answer: In 1981 Nokia together with Solara created a JV to market and develop radio

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