Today’s Wall Street Journal reported on consolidation in LCD manufacturing with the agreement of Innolux Display Corp. to buy Chi Mei Optoelectronics, both of Taiwan, in a $5.3 billion stock deal.
Innolux was founded six years ago by Terry Gou, who also founded and is chairman of Hon Hai Precision Industry, the world’s largest ( by revenue) contract manufacturing firm. Among their customers are Sony, Apple, Motorola, and Nokia. (This excellent August 2007 Wall Street Journal article profiles Gou and his company.)
How did Hon Hai get it’s start? By “making knobs for black-and-white TV sets.” 
One model of Nokian boots offered today.
One of those customers, Nokia, got it’s start in wood pulp in 1865, and later made a name for itself in rubber boots and tires. It wasn’t until the 1990s that Nokia began to focus on telecom. In 1990 the rubber boots business was spun out as Nokian. Two years later Nokia released their first GSM phone.
One of the biggest challenges facing any leader is determining the company’s direction and allocating the resources across many different opportunities.
In the case of these two companies, both multi-billion dollar global firms, the earlier decisions—to give up tires and knobs and focus on telecom and electronics—seem obvious. That’s seldom the case when you’re in the midst of making those decisions.
Today, faced with a rapidly-changing landscape, the management team at Nokia has reorganized (more than once), acquired several companies, and launched new services in an effort to better compete in this new world. Whether Nokia can remake itself this time, as they’ve done many times over their long history, is far from clear.
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