Linked by Thom Holwerda on Tue 24th Sep 2013 11:44 UTC
PDAs, Cellphones, Wireless

Finland is boiling with rage this weekend over the $25 M bonus payment the CEO Stephen Elop is set to receive as he leaves Nokia after his two-year tenure. Questions are now being raised by the oddest aspect of the bonus: the board of Nokia seems to have given Elop a $25 M incentive to sell the handset unit cheaply to Microsoft way back in in 2010. This effectively means that the board hired a man who was given a giant carrot to drive down Nokia's overall valuation and phone volumes while preparing a sale to Microsoft. What could possibly be a reason to structure Elop's original contract in this manner? Did the board in fact end up promising Elop more compensation in case he sells the phone division than if he runs it with modest success?

Vindication. We were right all along.

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Not only Finland is enraged.
by isaba on Tue 24th Sep 2013 14:52 UTC
isaba
Member since:
2006-12-30

Nokia was a great company with superb products. Yes, they missed the train of change in the smartphone market due to shortsightedness, but that does not invalidate their great job in devices, in feature phones (most Asha phones are simply good enough for most people!) and innovative ideas in such difficult times.

I also feel enraged and ashamed of these practices. I am aware that morals in business do not have any chance lately, but this, this ending is unnerving and disgusting.

Reply Score: 2

RE: Not only Finland is enraged.
by bnolsen on Tue 24th Sep 2013 17:14 in reply to "Not only Finland is enraged."
bnolsen Member since:
2006-01-06

The market was changing from dumb/feature phones to smart phones. Nokia's board was convinced their current business plan wasn't working and were sold on a new business plan that didn't pay off. Apparently no one offered a competing business plan that was appealing (that may have included android).

Yes, the stupidity of Elop combining the ratner and osbourne effects really kicked up the drama aspect of Nokia's spectacular flameout.

It's probably fine that nokia is investigated. What they'll probably find was a board and management full of total incompetents who essentially drove their mobile unit into unprofitability.

The moral of the story is: incompetence should be allowed to fail. smaller, newer, more nimble players should be allowed to succeed. Time to take on the evil patent system which kills this natural business cycle.

Reply Parent Score: 4