Transforming NOKIA
Insider account by the chairman who sold handsets to Microsoft.
Summary
Siilasmaa joined Nokia's board in 2008, became chairman in 2012, and led the company through the sale of its handset business to Microsoft and the acquisition of Alcatel-Lucent. This is his first-hand account of board-level crisis management.
The governance material is the substance. Siilasmaa describes a board that received polished presentations, did not ask about the software platform's actual state, and did not know until he specifically demanded a technical assessment that Symbian could not be made competitive and that MeeGo would not ship at scale in time. His conclusion is that the board's failure was a failure to ask, and he sets out what he calls entrepreneurial leadership and paranoid optimism: assume the worst plausible scenario, plan for it in detail, and then work to make the good outcome happen.
The practical device he describes is scenario planning taken seriously at board level. Before the Microsoft negotiation he had the board work through what Nokia would do in each outcome including the worst, which meant the company entered the negotiation with alternatives and could walk away. He attributes the eventual price and terms to that preparation.
The book is a chairman's account of his own tenure, and it presents his decisions favourably. The handset sale remains contested, and the book does not seriously engage with the argument that the Windows Phone decision made it inevitable. The material on board process, on demanding facts rather than presentations, and on preparing alternatives before a negotiation is transferable and is the reason to read it.
Key takeaways 7
- Nokia's board did not know the true state of its own software platform because it received presentations rather than technical assessments and did not demand them.
- A board's central failure is usually a failure to ask questions rather than a failure to decide correctly on what it was told.
- Paranoid optimism means planning the worst plausible scenario in full detail while working to produce the best one, and the planning is what makes the optimism defensible.
- Entering a negotiation with a fully prepared alternative determines the terms achieved more than any negotiating technique does.
- Scenario planning conducted by the board itself, rather than delegated to management, changes what the board is capable of deciding.
- A culture in which bad news is unwelcome produces reporting that removes exactly the information the board needs.
- Selling a failing business at the point of maximum remaining value requires deciding before the deterioration is visible in the results.
Who should read it
Directors and executives who want a first-hand account of board process failure and of preparing alternatives before a decisive negotiation.
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