Harvard Business Review

Conversation

CTO Bob Iannucci on the “deep future” of Nokia

Bob Iannucci, Nokia’s chief technology officer, is betting that the mobile-phone industry will soon make the same sharp turn that the mainframe, minicomputer, and PC industries took in past years: Platforms will become standardized, manufacturers will stop making incompatible hardware, and the value of software and services will soar. His job, as he sees it, is to help Nokia position itself to lead in this next phase of mobile communications.

Given that Nokia is firmly committed to the handset market, what response do you get when you propose that Nokia look for growth by taking a radical new direction?

Though the company is a bit humble about it, Nokia has a 150-year history of reinventing itself. Depending on how you count, we are on our fifth or sixth major reinvention. When I was running Compaq’s research back in 1999, I went to Finland to visit Nokia, and I was astounded by how much it invested in technological innovation – and astounded at myself that I didn’t know much about the company. Nokia became my model of an organization that reimagines itself by adding growth businesses to mature ones.

Since coming to Nokia, I’ve found that during the strategy process, the leadership is pretty honest about the state of the industry and the need to reinvent, and there’s a very healthy discussion – and a low degree of politics or turf protection. On a scale of one to 10, Nokia is maybe a one or two when it comes to corporate politics. The management structure is very flat, and strong interpersonal relationships are what drive the company forward.

The leadership also grasps the gravity of what reinvention means. Just recently, the company took a corporate structure that had been in place for a few years and basically blew it up. A lot of the senior managers are now in very different roles. The company also takes a clear-eyed approach to evaluating research centers: On the basis of our seven-year industry forecast, we’ve opened new R&D centers, but we’ve closed a handful of others, all in the name of better aligning our actions with our ambitions. This, of course, has been a painful process. But Nokia seems to have refined the technique of bringing the relevant facts to bear on a discussion, making a decision, and then executing like crazy.

You say you search widely for new technologies and product ideas. How do you handle the cost of casting a wide net? One thing I learned from IBM, where I worked for 14 years, is the importance of investing in basic science in areas that may have a profound impact on the company’s “deep future.” Our investment in nanoscience, for instance, is very much in the spirit of what IBM Research has done in hard sciences. But there’s a difference: We’re doing our nanoscience work in residence on university campuses with partners such as the University of Cambridge in the UK. Significant nanoscience work requires a world-class team and world-class facilities – Cambridge has both. We bring expertise and challenging problems, and it makes for an interesting collaboration. This is a strategy we have implemented worldwide – we have moved from being a closed innovator to being an open innovator. In addition to our own research centers, we have co-locations with a half dozen of the world’s top universities. Our researchers augment the universities’ work, the academic researchers get the potential for future commercialization of their ideas on a vast scale, and we accelerate one another’s efforts.

Assuming Nokia’s efforts are fruitful, how will people use mobile phones differently in the coming years?

Nokia is moving into services and software for mobility. We’re trying to fuse the physical and digital worlds and looking at how wristwatches, sensors in your car, and other types of input devices might interact with your mobile phone so that you can get a whole range of data, from information about your health, to the status of your automobile, to whether there’s traffic a few miles ahead.

One particularly exciting technology is the use of the phone as a sensor. Rather than use a text query to search the internet, our researchers use an image captured by the phone’s camera to initiate what they call a “zero-click” search. Point the phone at a shoe in a store window, and in a second or two you can read about it on your screen. Or take a picture of a sign in one language and get a translation of it in another. All we’re trying to do is orchestrate a revolution in the mobile phone industry.