Nokia reorganizes into four divisions

Move includes shake-up of top management

Finland's Nokia Corp. announced a corporate restructuring on Friday, including a shake-up of top management, in a move to strengthen its position as the world's largest mobile phone maker.

Beginning on Jan. 1, the company will have four business groups, compared to three today, with a new head of its core mobile phones division, the company said in a statement.

The four new divisions are: mobile phones, multimedia, networks and enterprise solutions. They will replace the current structure, consisting of mobile phones, networks and ventures, according to Nokia spokesman Lauri Kivinen.

The activities of the ventures group, including Internet telephony and multimedia, will be integrated into the four new groups, he said.

The current mobile phone group has nine subunits, which will be divided up among the new mobile phone, multimedia and enterprise solutions groups.

"Our main business is mobile terminals, which account for around 75 percent of our sales," Kivinen said. "It's a huge business in the world but one that is segmenting into areas with different dynamics. Our new structure reflects that."

Olli-Pekka Kallasvuo will be executive vice president and general manager of the mobile phones group. He replaces Matti Alahuhta, who will take control of a new corporate strategy and research unit, Kivinen said.

Sari Baldauf will continue as executive vice president and general manager of the networks group.

The multimedia division will focus on delivering attractive content, such as images, games and music, to consumers. Anssi Vanjoki will be executive vice president and general manager. The enterprise division will provide enterprises with terminals and other mobile connectivity systems and services. Nokia has yet to name a general manager.

All four groups will be serviced by three new global operating units, according to Kivinen.

The technology unit will be responsible for company-wide technology management and development, delivering technologies not only to the four business groups but also external customers. Pertti Korhonen will be in charge of the unit as senior vice president and chief technology officer (CTO). He replaces Yrjo Neuvo, Nokia's current CTO, who at age 61 will assume a senior advisory role, according to Kivinen.

"This unit will build the basic platforms for most of the mobile terminal products," he said.

The new corporate strategy and research unit will focus on company-wide strategy and long-term research, in addition to other business ventures and infrastructure activities. It will be headed by Alahuhta who is currently in charge of the mobile phone division.

Sales and marketing, manufacturing, logistics and sourcing will be rolled into a still-unnamed unit headed by Pekka Ala-Pietilä, who will continue as president of Nokia Corp.

"All these units will help us exploit economies of scale wherever possible," Kivinen said.

Management changes at Nokia include the appointment of Rick Simonson as senior vice president and chief financial officer (CFO).