Sweeping changes afoot at Nokia as CEO warns of ‘burning platform’

Something major is brewing in the boardrooms of Finnish mobile giant, Nokia. The rumours were confirmed by a leaked internal memo from dynamic new CEO, Stephen Elop, that gave a scathing indictment of the state that Nokia finds itself in at the start of 2011.

According to gadget blog, Engadget, the memo contains gems like: “The first iPhone shipped in 2007, and we still don’t have a product that is close to their experience. Android came on the scene just over 2 years ago, and this week they took our leadership position in smartphone volumes. Unbelievable.”

Elop is a former Microsoft executive who took over at Nokia in September after its board fired the previous Finnish incumbent. Ahead of a crucial announcement on Friday, a few hints of change have emerged. Firstly, there is a good chance Nokia will ditch Symbian and adopt the Android operating system going forward. Others believe that it will throw in its lot with Microsoft and adopt the fledgling Windows Phone 7 software for Nokia devices. Finally, in another dramatic break from the past, it seems almost certain that Nokia will shift its headquarters to Silicon Valley.

The spectre of Silicon Valley looms large over the entire memo as Elop encourages the company to abandon the ‘burning platform’. “Google has become a gravitational force, drawing much of the industry’s innovation to its core,” wrote Elop in the memo, along with gems like this: “Symbian is proving to be an increasingly difficult environment in which to develop to meet the continuously expanding consumer requirements…”

Elop was brought in as an outsider and his frank assessment of the situation might be exactly what Nokia needs to shake the sense of lethargy which is devastating the company. The CEO acknowledges that the company is hurting on the high-end phones but also from the competition at the lower end, saying that “at the lower-end price range, Chinese OEMs are cranking out a device much faster than, as one Nokia employee said only partially in jest, ‘the time that it takes us to polish a PowerPoint presentation.’ They are fast, they are cheap, and they are challenging us.”

The memo ended by preparing employees for some major changes to be announced on Friday, days before the Mobile World Congress kicks off in Barcelona.

In his own words, Elop concluded:

“Nokia, our platform is burning.

We are working on a path forward — a path to rebuild our market leadership. When we share the new strategy on February 11, it will be a huge effort to transform our company. But, I believe that together, we can face the challenges ahead of us. Together, we can choose to define our future.

The burning platform, upon which the man found himself, caused the man to shift his behaviour, and take a bold and brave step into an uncertain future. He was able to tell his story. Now, we have a great opportunity to do the same.

Stephen.”