Understanding the competitiveness of the Finnish ICT cluster in the context of Nokia's decline in recent years

The study of clusters and competitiveness has drawn considerable attention of the academics as well as the policy makers in recent times. The Finnish ICT cluster, with Nokia in heart, has been instrumental in making the Finnish economy as a competitive one. Nokia, in particular, contributed significantly to the astounding growth of the Finnish economy – in exports, GDP and the total R&D expenditure. However, Nokia has left its prime time behind and already seen its descent since 2008. The study at hand scrutinizes the competitiveness of the Finnish ICT cluster in the context of Nokia’s decline in recent years. To carry out the study, a case study method using multiple sources of data was applied. In the first place, Emerald model was used to observe the changes in the competitiveness of the ICT cluster within a certain time frame. Secondary data were collected from different statistical databases, namely Statistics Finland, OECD Stat, World Bank data and UNCTAD data among others. Moreover, telephone interviews were conducted to find out information about the knowledge dynamics existing in the cluster. In addition, three face-to-face interviews, using semi-structured questionnaires, with the industry experts were conducted to gain further insights about the relationship between Nokia’s downfall and the competitiveness of the Finnish ICT cluster. Last but not least, triangulation was made with the aid of relevant secondary data obtained from existing empirical studies as well as media coverage on the issues. The results suggest that the decline of Nokia significantly affected the ICT cluster. The cluster, however, still appears to be competitive, but the competitiveness is certainly eroding in a number of dimensions. The cluster constituents, nevertheless, have been taking several initiatives, such as reinventing ICT related education, to raise the competitiveness level. The ICT firms are also diving in narrower fields. A lot of money is being poured in R&D and innovation. Consequently, a large number of start-ups have been established. The future success of Finland and its ICT cluster relies heavily on the growth of these companies