Nokia needs to cut more costs, implements Voluntary Resignation Package

By on February 24, 2009 at 4:58 PM.

Nokia needs to cut more costs, implements Voluntary Resignation Package

The heat is on and Nokia appears to be feeling the burn as much as the next company as it has just announced a new round of cost-cutting measures that will go into effect next week. The Finnish handset manufacturer turned Internet Company revealed today that it will be introducing a new Voluntary Resignation Package that invites employees to voluntarily and amicably part ways with the company. This of course is in addition to the recent news of massive temporary layoffs at its production plant in Salo. A sound word byte from Hallstein Moerk, Nokia’s Head of Human Resources:

The response from employees and employee representatives in proposing ideas to help reduce personnel-related costs has been encouraging. We have considered these and are now announcing voluntary initiatives that could contribute to our efforts to adjust our cost base to the current market environment. If successful, the voluntary initiatives will lessen the need for involuntary redundancies.

Nokia will put the package into effect beginning March 1st and it will remain on the table until 1,000 employees have taken Nokia up on its offer. In addition, Nokia is encouraging its staff to request unpaid leave of up to one month and will happily grant such requests provided “business continuity is not jeopardized”. Sad news indeed, but we’re certainly hoping enough people can take advantage of the VRP and land gigs elsewhere so that Nokia doesn’t have to resort to any more “involuntary redundancies”.

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Nokia to combat downturn with production cuts, temporary layoffs

By on February 11, 2009 at 4:16 PM.

Nokia to combat downturn with production cuts, temporary layoffs

As MWC draws closer mobile fans around the world wait in anticipation as mobile companies prepare some of their biggest announcements of the year. Leading up to MWC, news coming from manufacturers is historically positive – a taste of things to come in Barcelona. In this economic climate however, mobile companies find themselves unable to wait until this sacred time has passed and we are still seeing bad news come down from every corner of the industry. Today’s news comes from our friends in Finland as Nokia discusses the coming year with two key phrases: scale down and reduced market demand. Juha Putkiranta of Nokia:

With these plans, we aim to scale down Salo production to reflect reduced market demand, while operations in the factory continue uninterrupted.

Nokia plans to cut handset production and layoff the entire staff at its Salo plant (2,500 workers) on a temporary rotational basis. In other words, the plant will remain operational but only 20 to 30 percent of its staff will be on hand at any given time. Following Nokia’s closure of its German manufacturing plant, Salo is the last major handset plant in Western Europe and had been used to produce some of Nokia’s higher-end handsets, the bulk of which will now likely be moved to foreign plants. All of these moves of course, are part of an effort to shave $905 million from its operating expenses this year as many project Nokia’s shipments and sales to continue to decline. Less market demand, declining numbers and more competition are never a good trio for any market leader but we’re hoping Nokia has some tricks up its sleeve for 2H 2009 and beyond.

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Samsung announces reorg, splits into two divisions

By on January 16, 2009 at 1:15 PM.

Samsung announces reorg, splits into two divisions

Keeping the good times rolling today, Samsung has announced that it will undergo a massive reorginization in an effort to stay afloat during the economic downturn. Among the info it smacked shareholders with this morning, the company will split into two separate divisions: a Digital Media and Communications division that will focus on mobile phones, televisions and other consumer electronics, and a Device Solution division that will handle the component, semiconductor and LCD businesses. Current Samsung Electronics CEO Lee Yoon-woo will retain his title and will head the Device Solution division while Choi Gee-sung, current president of Samsung’s cellphone unit, will head up the Digital Media and Communications division. There will also be another healthy round of musical chairs involving a variety of key roles throughout the company. Samsung is scheduled to announce its Q4 2008 earning on January 23rd and this massive announcement exactly one week prior to the earnings call doesn’t bode well to say the least. Samsung posted a 44 percent drop off in Q3 2008, compared to the same quarter one year prior.

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