ERIC Ericsson

By Dominic Chopping

Nokia Corp. (NOK) said Friday that the head of its Mobile Networks division is leaving the company as part of a structural and management shake-up aimed at ramping up its strategy in the face of falling sales and stiff competition.

Samih Elhage, who has been president of Mobile Networks since the end of 2015, will step down on April 1, but remain as an adviser until the end of May.

The telecom equipment industry has been hit by slowing demand from telecom carriers, many of which have finished rolling out the latest-generation 4G wireless networks. At the same time, Nokia and Swedish peer Ericsson AB (ERIC) are battling competition from Chinese companies such as Huawei Technologies Co. and ZTE Corp. (000063.SZ).

Nokia's networks sales during the final quarter of 2016 declined 14% compared with 2015, but those results were partly offset by savings and cost reductions from the Alcatel-Lucent integration, as well as strong growth in Alcatel's submarine cable business.

The Finnish telecommunications company said Friday it will separate its mobile networks division into two organizations. One will be called Mobile Networks and focus on products and solutions while the other will be Global Services, focused on services.

In a further step, the chief innovation and operating officer role will be split, with its current operating activities moved to a newly-appointed chief operating officer, while innovation activities will be managed by Nokia's chief technology officer, and incubation by Nokia's chief strategy officer.

Chief innovation and operating officer Marc Rouanne becomes president of the Mobile Networks business group, while the executive vice president of Global Services, Igor Leprince, becomes president of that division.

Chief operating officer of Fixed Networks, Monika Maurer, is named group chief operating officer, and Marcus Weldon, president of Nokia Bell Labs and chief technology officer, will retain his responsibilities.

Chief strategy officer, Kathrin Buvac, takes on additional responsibilities for incubation of select new business opportunities, and Barry French, chief marketing officer, assumes additional responsibilities for health, safety, security and environment.

"These changes are designed to accelerate the execution of our strategy," said Nokia Chief Executive Rajeev Suri. "They will strengthen our ability to deliver strong financial performance, drive growth in services, meet changing customer demands in mobile networks, achieve our cost-saving and ongoing transformation goals, and enable strategic innovation across our networks business."

All changes are effective from April 1, 2017, it said.

-Write to Dominic Chopping at dominic.chopping@wsj.com; Twitter: @domchopping @WSJNordics

(END) Dow Jones Newswires

March 17, 2017 04:20 ET (08:20 GMT)

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