Part 3: Lessons From Nokia's Decline

In Part 1, we explored the contrasting fortunes of Nokia and AMD. Nokia, once a mobile phone giant with nearly 50% market share, experienced a dramatic fall by 2013, selling its mobile division to Microsoft for $7.2 billion. Meanwhile, AMD, on the brink of collapse in 2014, surged back to prominence under Dr. Lisa Su’s leadership, with a valuation exceeding $150 billion by 2024. This set the stage for understanding how two companies facing similar crises had such different outcomes. Read here: The Rise & Fall of Titans

In Part 2, we took a deep dive into AMD’s turnaround, led by Dr. Lisa Su. We analyzed her approach using Kotter’s 8-step change model. From creating a sense of urgency and building a guiding coalition to delivering short-term wins and anchoring change into AMD’s culture, Dr. Su’s leadership offers a blueprint for successful transformation. Her ability to balance long-term vision with immediate action was key to AMD’s resurgence. Read here: Leadership Lessons Through Kotter’s Lens

After analyzing AMD's remarkable turnaround, it’s time to look at the other side of the story—Nokia's fall. In 2011, then-CEO Stephen Elop delivered the infamous "Burning Platform" memo, highlighting Nokia's deteriorating position. (If you haven't yet, you should read Stephen Elop's Burning Platform memo. It's a fascinating inside look at what went wrong.) Despite this call to action, Nokia was unable to turn the tide. In this section, we’ll analyze Elop’s leadership and strategy through Kotter’s 8-step model to uncover what went wrong and what lessons we can take away from this failure.

1. Create a Sense of Urgency

It provides a lot of context for the rest of this article. Elop’s “Burning Platform” memo in 2011 highlighted Nokia’s precarious position. While it gained attention, it demoralized employees and created fear rather than unity.

2. Build a Guiding Coalition

Elop struggled to build a cohesive coalition. Internal silos and resistance to change weakened leadership alignment. Key talent left during his tenure.

3. Develop a Vision and Strategy

Elop’s decision to partner with Microsoft and adopt Windows Phone as Nokia’s primary OS was controversial. It lacked market support and alienated customers favoring Android.

4. Communicate the Vision

The “Burning Platform” memo communicated urgency but failed to provide an inspiring vision for Nokia’s future, leaving stakeholders uncertain.

5. Empower Broad-Based Action

Nokia’s entrenched culture and bureaucracy hindered decision-making. Employees lacked the autonomy and resources to drive meaningful change.

6. Generate Short-Term Wins

Unlike AMD, Nokia failed to achieve meaningful short-term wins. The Lumia phones and Windows Phone platform failed to gain traction, eroding momentum.

7. Consolidate Gains and Produce More Change

Without early successes, Nokia’s transformation stalled. The failure of Lumia phones undermined confidence in Elop’s leadership.

8. Anchor New Approaches in the Culture

Elop’s changes did not take root in Nokia’s culture. The adoption of Windows Phone alienated employees and eroded Nokia’s legacy of innovation.

Why Elop’s Approach Fell Short

Elop’s failure to align with Kotter’s principles reveals key missteps:

• Lack of Employee Buy-In: The “Burning Platform” memo demoralized employees instead of rallying them.
• Strategic Misalignment: Adopting Windows Phone limited Nokia’s competitiveness in a market dominated by Android and iOS.
• Failure to Deliver Wins: Without early successes, Nokia lacked momentum and credibility.
• Cultural Disconnect: Nokia’s core identity was overshadowed by externally driven strategies.

By comparing Elop’s approach to Dr. Su’s at AMD, we see the critical importance of inspiring leadership, clear vision, and aligning change efforts with Kotter’s principles.

Lessons for Every Leader

The stories of AMD and Nokia illustrate the power of leadership in times of crisis. Dr. Lisa Su's visionary yet pragmatic approach led AMD to thrive, while Nokia’s missteps under Stephen Elop serve as a cautionary tale of how even market leaders can falter without alignment and strategic clarity.

Whether you're a senior executive or just starting your career, these lessons are timeless: inspire your teams with a bold vision, execute relentlessly, and never underestimate the power of culture in driving transformation.

?? What leadership lessons resonate most with you? Have you seen similar examples of success or failure in your own organization? Let’s discuss in the comments!