Nokia breaks its new mould to capitalize on enterprise sales opportunity
- Nokia has set up independent business groups to deal with needs of telcos and other large network operators
- But enterprises buy in a different way and at a different pace
- So Nokia has created a dedicated sales team to address the enterprise market opportunity
- Aiming to capitalize on its strong position in private wireless networks
Encouraged by its success in the private wireless networks market, Nokia has spied an opportunity to help grow its overall business in the coming years by selling more of its gear to enterprise customers and will break its new strategic model of standalone, independent business groups to ensure it doesn’t miss out on an important new business opportunity.
While Nokia now comprises four business groups that are all standalone units with their own R&D, sales and support teams, budgets and financial targets and responsibilities, the vendor is making an exception to that new rule by creating a dedicated enterprise sales team that will work across the full portfolio and sell products from any of the business groups – not just the Mobile Networks business group, but also from Network Infrastructure (fixed broadband, IP, optical) and Cloud and Network Services (virtualized functions, mobile core, analytics systems, business and operations support software).
This sales team, working in a different way to the rest of the company, is needed because enterprise customers move at a different pace and buy their technology in a different way, stated Nokia CEO Pekka Lundmark (pictured above) during the vendor’s Capital Markets Day. He said this sales team will as part of the Cloud and Network Services business group.
In a way, this is a continuation of what Nokia had under its previous structure, which included a unit called Nokia Enterprise that had its own dedicated sales force that sold directly into verticals such as transportation, energy, manufacturing and logistics, and governments. That Enterprise unit was headed up by Raghav Sahgal, who is now President of the Cloud and Network Services business group, so there is continuity in Nokia’s plan.
And in Nokia’s new growth strategy, enterprise opportunities play a key role. The vendor sees a number of key trends impacting the comms networking industry in the coming years, including how “connected digital enterprise will drive massive productivity, efficiency and safety gains across industries. A result of this will be significant growth in the Enterprise market,” the vendor noted in this announcement. “From 2022 onwards, the company will accelerate competitiveness and aims to grow margins through enhanced technology leadership, digitalization of own operations, automation and capturing emerging opportunities. It then plans to scale up to drive growth in new use cases and business models including in enterprise and private wireless in order to grow faster than the market.”
In 2020, Nokia generated €1.57 billion in revenues (7.2% of total sales) from the enterprise market, up by 11% from 2019, and ended the year with 1,545 enterprise customers.
It is regarded as the leading vendor in the private 4G/5G wireless networks technology sector, ending 2020 with 260 customers in what is a growing market as more spectrum is partitioned off by regulators for enterprise and campus networks. (See Nokia is touting 5G standalone as a feature of its industrial-grade private wireless offer.)
And to capitalize further on the opportunity, Nokia based its radio access network (RAN) relationships with the three giant hyperscalers announced earlier this week around enterprise network opportunities. (See Nokia seals cloud RAN relationships with AWS, Azure, Google Cloud.)
- Ray Le Maistre, Editorial Director, TelecomTV
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