Nokia manager exodus grows as new CEO starts strategy shift

[HELSINKI] At least five senior leaders are leaving Nokia as chief executive officer (CEO) Pekka Lundmark starts to reshape the Finnish network equipment maker.

Basil Alwan and Sri Reddy, co-presidents of IP/Optical Networks, and Sanjay Goel, who leads global services and operations, are leaving, a Nokia spokesperson confirmed by email. They join chief technology officer Marcus Weldon and chief marketing officer Barry French, whose departures were announced on social media recently.

The changes are part of a shift to a new operating model at the start of next year that's better aligned with customer needs, the company said in a statement. It said the changes will reduce complexity, improve cost-efficiency and drive accountability.

"As a result, there is some evolution within the senior team and these changes are being worked through at an individual level with a lot of mutual goodwill and respect," it said.

Mr Lundmark took over as CEO in August and soon abandoned his predecessor Rajeev Suri's strategy of selling complete "end-to-end" network systems including hardware, software and services. He's pushing Nokia to invest more in 5G wireless technology after losing ground to rivals.

Nokia was caught off guard when the 5G investment cycle began before the company had finished integrating its giant purchase of Alcatel-Lucent from 2016.

Setbacks in creating proprietary chipsets forced it to buy more expensive alternatives, eating into profit margins and hampering its ability to invest in R&D. As a result, it's now losing market share as phone companies roll out the new networks.

Nokia will "invest to win in those segments where we choose to compete", Mr Lundmark said in October. It plans to share more on its strategy changes on Dec 16 and at a capital markets day on March 18.

BLOOMBERG