REINVENTING

I Putu Wahyu Dwinata JS 432630

Mellisa Alvina 432654
Ericsson is
a Swedish multinational
networking and
telecommunications
company headquartered
in Stockholm.
• The company offers services:
• Software and infrastructure in
information and communications
technology for
telecommunications operators
• Traditional telecommunications
• Internet Protocol (IP)
• Networking equipment
• Mobile and fixed broadband
• Operations and business support
services
• Cable television
• IPTV
• Video systems
• An extensive services operation.
• Ericsson had 35% market share in the 2G/3G/4G mobile network
infrastructure market in 2012.
• The company was founded in 1876 by Lars Magnus Ericsson; as of 2016 it is
headquartered in Stockholm, Sweden.
• The company employs around 95,000 people and operates in around 180
countries. Ericsson holds over 42,000 granted patents as of December 2016,
including many in wireless communications
 VALUES

• Three core values: Respect, Professionalism, and

Perseverance.
• The values matter because they have become established
within our business over 140 years of history.
• They are tried, tested and trusted. In fact, our internal
surveys show that 90% our employees feel that our core
values are relevant to them.
• Ericsson is a place where people can do their best. In an
organization of such breadth and such diversity – playing
such a fundamental role in how society and technology
can integrate in the future – there is vast potential to
think big and see ideas make an impact.
What was the Dotcom Bubble?
• The dotcom bubble was a rapid rise in U.S.
equity valuations fueled by investments in
Internet-based companies during the bull
market in the late 1990s.
• During the dotcom bubble, the value of equity
markets grew exponentially, with the
technology-dominated NASDAQ index rising
from under 1,000 to more than 5,000
between 1995 and 2000.
 PROBLEMS

Financial Report
1998-2002
3 PROGRAMS FROM HELLSTROMS
THE FIRST PROGRAM
-External R&D consultants and
temporary workers from 15,000 in
March to less than 7,000 by year
end, as well as cutting travel and
other expenses.
-Ericsson launched a 50/50 joint
venture with Sony for marketing
mobile phones.
-Ericsson had reduced its staff by
22,000 to 85,000
THE SECOND PROGRAMS
Ericsson decided in early 2002 to
implement another savings
program. An additional SEK 20
billion (or 29%) would be taken
out of the operating expenses
over the next two years.
THE THIRD PROGRAMS
-Ericsson was in the midst of its
savings programs.
-Staff had been reduced by
another 20,000 to 65,000.
-Ericsson was still reporting an
operating loss of SEK 21.3 billion,
less than in 2001 before the joint
venture with Sony, but still
increasing on the mobile systems
side.
 PROBLEMS

TECHNICAL ORIENTATION MARKET ORIENTATION

ORGANIZATION Sales
STRUCTURE
AND
WORK FLOW

Marketing

Research and Development


R&D
- Only one R&D for all business
units
-The period of products
development by R&D is flexible,
so the product develop outcome
can be maximize
ALTERNATIVE
PROGRAM 1
SOLUTIONS
MARKETING SALES
- Increase the promotion and - The CEO is directly involved
introduce of 3G technology to all with sales
over the Ericsson market.
- Create sales events for every
- Provide one marketing message line of business
model to all over the Ericsson
market.
- Conducting an Ericsson brand
health survey on the market.
 POSITIVE & NEGATIVE
PROGRAM 1

POSITIVE
- The CEO can establish close relationships with
customers.
- Does not require a large fee in carrying out
the program.
- With unlimited time of development product,
we expected the product developed is perfect.
- Ericsson could know how they were perceived
by existing and potential customers and what
the clients’ key selection criteria were.
NEGATIVE
- The CEO cannot focus on making important
decisions for the company, because they have to
deal with customers. Like expansion and investment
- It is uncertain that all countries need 3G
technology
- If the periode of product development is too long,
it can make the company take precedence over
competitors.

R&D
- R&D should be broken out into
the different business units.
- R&D develops products based
on market trend research and
consumer needs by marketing
- The period of development of
R&D must be accelerated by half
of the usual.
PROGRAM 2
MARKETING
- Promoting 3G only for every
countries that have 3G
technological and market
readiness.
- Provide different marketing
messages in each country.
- Marketing division start on
market trends researches and
consumer needs
ALTERNATIVE
SOLUTIONS
SALES
- Looking for a sales and marketing
manager to manage sales
- Create sales competition in every
business unit.
- Eliminate business lines that do
not contribute income.
 POSITIVE & NEGATIVE
PROGRAM 2

POSITIVE NEGATIVE
- The CEO can focus on managing the whole business perfectly and - Requires a large enough cost to run the
focus on important decision making such as investment. program.
- Competition can increase sales and company performance in each
unit.
- There are high pressure from every
business line on sales competition.
- The company knows market trends and consumer needs for
product development and can create products that suit the - By eliminating products that contribute
consumers needs, not just based on sophisticated technology. little to income, it can become a failure in
- Marketing done differently in each country can make the product the future for the company.
more acceptable because it uses content that suits the needs and
culture of that country.
- The accelerated period of R&D can make a company overtake
competitors in the launch of new products or technologies.
- Ericsson can be focus on products that contribute high income.

R&D
- R&D should be broken out into
the different business units.
- R&D develops products based
on market trend research and
consumer needs by marketing
- The period of development of
R&D must be accelerated by half
of the usual.
RECOMENDATION
PROGRAM 2
MARKETING SALES
- Promoting 3G only for every - Looking for a sales and marketing
countries that have 3G manager to manage sales
technological and market
readiness. - Create sales competition in every
business unit.
- Provide different marketing
messages in each country. - Eliminate business lines that do
not contribute income.
- Marketing devision start on
market trends researches and
consumer needs
THANK YOU