leading the transformation (jean-francois baril) (2007) (407.13 kb)
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1 © 2007 Nokia Capital Markets Day 2007
Leading the TransformationJean-Francois Baril
Senior Vice President Sourcing
3 © 2007 Nokia Capital Markets Day 2007
(M)
2007200620052004
20
40
60
80
100
120
20032002
Pull-driven Supply Chain
Terminal Vendor Shipments (m) Operating Margins (%)
0%
5%
10%
15%
20%
25%
Q304Q404Q105Q205Q305Q405Q106Q206Q306Q406Q107Q207Q307
Source: NokiaNokia Motorola SonyEricssonSamsung LG
4 © 2007 Nokia Capital Markets Day 2007
The results are visible in the Top Line…
Product Sales Volume vs
Plan
-120% -80% -40% 0% +40% +80% +120%
Supply flexibility management & Product introduction
Market share opportunity captured:
~10’s of millions unitsRevenue opportunity captured:
~Billions €
Source: Nokia
5 © 2007 Nokia Capital Markets Day 2007
Bottom Line…
Cost of goods sold per unit
Economies of scale and product cost management
Gross Margin opportunity captured:
~100’s of millions €
Gross Margin
Q306 Q406 Q107 Q207 Q307
Gross Margin %
Source: Nokia
6 © 2007 Nokia Capital Markets Day 2007
1999 2000 2001 2002 2003 2004 2005 2006
…and Balance Sheet
Component Inventory Value
Revenue
Inventory management
Cash flow opportunity captured:
~100’s of millions €
Source: Nokia
7 © 2007 Nokia Capital Markets Day 2007
Supplier Survey
Excellent Unacceptable
0% 20% 40% 60% 80% 100%
Doing business with Nokia
Planning and execution
Quality practices
Relationship management
Collaboration
Corporate responsibility
Source: Nokia
8 © 2007 Nokia Capital Markets Day 2007
Research criteria• Financial performance • AMR expert evaluation• Peer assessment
1. Nokia2. Apple3. Procter & Gamble4. IBM5. Toyota Motor
World number one Supply Chain
Source: AMR Research Supply Chain Top 25 for 2007
(http://www.amrresearch.com/supplychaintop25/)
“As a pioneer in value chain strategy, Nokia has led in supplier development, sales & operations planning, and collaborative product development”
10 © 2007 Nokia Capital Markets Day 2007
Transforming mobility and the internet
SUPERIOR and PROFESSIONAL EXECUTIONin Technology Planning, Quality, Supply and Cost
Capturing fast benefits of new business models
Working only with the best suppliers
Enhanced collaboration
Way ofWorking
11 © 2007 Nokia Capital Markets Day 2007
Technology management modes for future growth
Key software assets
Interfaces Scale advantage Open Source software
Trend
Focus
USE & CONTRIBUTEBUYSPECIFYMAKE
12 © 2007 Nokia Capital Markets Day 2007
Working only with the best suppliers..
Leadership and
values
Investment Capability
LowestTotal Cost
ProductPerformance Time to
Market
..and Supplier Portfolio# of Suppliers
HWSW & content
3
2
1
13 © 2007 Nokia Capital Markets Day 2007
Enhanced collaboration
Passion and TrustCo-creation
RewardsRisk Management
Human and business leadership
Nokia• Technology
planning• Product• Logistics
Supplier• Capabilities• Scale• Innovation