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Table of Contents
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1 Introduction-Motorola Company
2 Part A. The Main Reasons that caused a company to fail its
operation by discussing with the case study of Motorola.
3 Part B. Implementation of any organisational change model
4 Conclusion
5 References
6 Appendix
Introduction- Motorola Company
History of Motorola
The two founders of Motorola-Paul V. Galvin and his brother, Joseph E. Galvin, starts with
purchasing a battery eliminator business in Chicago at September 1928 and named the
company as Galvin Manufacturing Corporation.
Galvin‟s first product is to develop is a battery eliminator which allows electronic devices to
run on electricity rather than battery.
Later, the name Motorola was given to Galvin‟s first car stereo. „Motor‟ stands for car and
„ola‟ stands for sound. Year 1936 onwards, Galvin production lines were dominated by
manufacturing radios for cars and receivers up to 1947 where they produce their first
television and the company name changes from Galvin Manufacturing Corporation to
Motorola by continuing manufacturing communications mediums.
Starting from the year 1967, Motorola expands its markets into other countries like Australia,
Canada, France, Hong Kong, Israel, Italy, Japan, Malaysia, Mexico, Puerto Rico, South Korea,
Taiwan, the United Kingdom and West Germany. Later on 1969, Motorola starts supplying
the National American Space Agency (NASA) with radio equipment so astronauts can
communicate with their Earthly bases. The first man on the moon, Neil Armstrong
communicated with Earth whilst on the Moon using a Motorola Radio.
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In 1973, Motorola introduce the world‟s first cellular mobile phone-DynaTAC which uses
radio technology and is released in 1984. Then, Motorola starts to combine both computer and
radio technology to make the first cellular network which the DynaTAC operated on.
Motorola began to make mobile handsets smaller and smaller sizes. In 1996 Motorola
released the StarTAC which weighed in at 88 grams only. So far, it is still the lightest even in
this day and age.
Continue at the year 2000, Motorola and General Instrument Corporation merged to enhance
their services and in 2001 Motorola introduces the Motorola v60 phone the world first metal
mobile phone which is available on the cellular networks GSM, TDMA and CDMA. Next, in
the year 2002, Motorola developed released a GPS chip that could be installed into consumer
electronics to enable location positioning. Also, Motorola released a 3G which canbe
transmitted over CDMA network.
Finally, Motorola releases the Cross-Technology PoC product line that enables subscribers to
have "push-to-talk" connectivity across and between GPRS, CDMA2000 1X, and WiFi
networks and Motoroloa releases Ojo Personal Video Phone. Ojo promises broadband
connectivity and a video phone that doesn‟t break up which is commonly known with video
phones.
Sources from: http://www.motorola-phones.com/motorola-history.html
A) The Main Reasons that caused a company to fail its operation by discussing with
the case study of Motorola.
What I can say in Motorola is intermediate failure which is almost losing out their
entiremobile or smart phones market share to their competitors such as Apple, Samsung,
Nokiaand so on.Table 1 below is the diagram showing that the Global Mobile Device Sales to
consumer for the year ended 2011.
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Available at:http://www.extragsm.com/news/gartner-s-phone-market-share-report-for-2011-
i719.html
According to the Extragsm.com, Nokia is having highest sales among the competitors at the
year 2011 which is 11,699.4 units, taking over the mobile device market share of 23.4%
followed by Samsung, Apple and so on. Where by Motorola is at the 9th ranking of 2.1% with
sales of 10,075.3 units only. So what exactly are the reasons which led to these failure
imposed on Motorola company?
No proper Leadership
Motorola was too arrogance at one time not knowing that their other competitors were coming
into the market- the rivalry of the industry.Motorola currently is that they attempted to turn
their wayward ship around with repeated job-cuts and still confused with the corporate
restructuring. Most significantly, Motorola has decided to spin-off its handset business, in
hopes that it can still make money from its cell phone-making business.
However, the problem Motorola is currently facing is rooted in the company leadership‟s
apparent inability to get the right person for the executive manager‟sposition of its various
cell phone divisions and refusal to cut-off its useless heads and start fresh.
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Failed on product and market differentiation due to lack of market knowledge
What Motorola failed to realize was that the cellphone market changed the consumer‟s buying
decisions from “hardware”, to a “software decision”. In the trend now, customers want to run
real, native, apps on their phones. End of story. After the initial boom of cell phone designs in
the early ‟00s, people don‟t care anymore if the new RAZR is 1mm thinner than the previous
model. Phone form factors and battery life have become good-enough in the last 4 years for
almost all manufacturers, and so the interest and market differentiation has shifted towards
software solutions instead. Also, Motorola was too concentrating on putting their product
research and development instead of marketing which causes they lost in the battle of mobile
device market. Motorola often attracted to businesses that are pioneering a brand new product
or industry. While a precious few are successful, most fail. Businesses that are radically
different from existing known businesses can even scare off customers rather than attract
them. Below is an example of the product life cycle.
Product Life Cycle, Available at:
http://www.consumerpsychologist.com/marketing_introduction.html
From the diagram above, we can get to know that it is necessary for a product to reach a
certain maturity stage before it decline. Each new product intro to the market will continue
with growth. Motorola does not understand to invent or create product according to market
needs, the demand which is what consumer want, not to create product according to what they
think the consumer want. This is why they fail to strategize their business continuously.
Right business but Wrong timing
Motorola got out of the right business at the wrong time. Motorola at one time owned lots of
spectrum, which it traded for equity in Nextel. So it starts every year with zero sales while
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firms such as Qualcomm own intellectual property worth billions, and Verizon, AT&T and
Sprint have millions of customers who will pay them $500/year. Motorola turned down a
chance year ago to buy both Qualcomm and/or Nokia (for $20 million!). Motorola missed the
movement to 3G. Its biggest customers are the U.S. wireless carriers, didn't think they wanted
3G. So Motorola listened to its customers, when they should have been listening to its
customers' customers.
Failure in CRM
For some time, Motorola was too arrogance on their product which later makes Motorola
didn't execute. Their customers start to have a hate-hate relationship with Motorola, which did
not deliver what it promised it would. Motorola never drank its own Kool-Aid; they never
built the "seamless mobility" lifestyle among its various product groups. They couldn‟t find
any way that consumers could have wanted to tie in their needs at home, at work, on their
person and their auto. Also, Motorola couldn‟t bring these warring tribes together inside the
firm. There are basically no proper communication way for Motorola to communicate or to
interact with their customers which led to failure in customer relationship management.
B) Implementation of any organisational change model
Restructuring to reengineer the management
The main problem exist in Motorola is starting from the bottom of the root which is the
management problems and the company is still remained there. I would recommend Motorola
to actually hire an outside CEO. To do this, I think, is a sign of a poorly run company. Hiring
an outside CEO means that the company has not done a good job of developing leaders in-
house. Sometimes it is necessary though, because everyone within the company thinks a
certain way, and a fresh perspective is needed to get them out of a rut.
Motorola would do better to bring in an outsider. It needs someone immediately capable of
cutting through the company's notoriously intractable bureaucracy and hidebound engineering
culture. Motorola is famous for hanging on to technologies such as analog and satellite phones
long after the market rejects them.
It needs a leader like Edward D. Breen Jr., the former COO it lost to Tyco International (TYC )
in 2002 after just a few months on the job. Breen impressed many by killing unpromising
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cable-modem technology and urging the sale of the wireless-infrastructure unit. "My issue
with Motorola has always been the glacial pace of how they run their businesses," says Kevin
M. Rendino, a fund manager at Merrill Lynch & Co., which owns 9.7 million Motorola shares.
GET TOUGH. The company also needs a leader with a proven record for divining key tech
trends. With wireless growth slowing and phones fast becoming a commodity business,
Motorola's next chief needs to understand how to catapult into such promising areas as
gaming and PC-like smart phones. That's where a Silicon Valley exec could help someone
who knows how to develop technology that matches what customers want.
That has been a perennial problem at Motorola, which has failed to customize cell phones for
key carriers such as Sprint (FON). The new CEO ideally would have experience in both
marketing and technology — one reason investors say Edward J. Zander, former CEO of Sun
Microsystems (SUNW), would be a good fit.
Above all, the next chief will need to be tough. He or she will have to decide what to
outsource and what to keep in-house, as well as what to jettison. While its walkie-talkie
technology is a keeper, axing the rest of the infrastructure biz looks like a no-brainer. Figuring
out what to do with semiconductors won't be so easy, since wireless chips are part of the
company's heritage.
That's precisely why an outsider would be best: Motorola needs someone willing to slay a few
sacred cows. The company's success may depend on it. Basically this can be done with the
following steps.
Empowering Leadership
For Motorola to besuccesses is to empower leadership. This type of business management
style has also been called transformational leadership. Transformational leadership is the type
of motivational style that draws others in and inspires them to achieve something greater than
themselves. However, the employees and staff members of Motorola do not merely do the
work; they also become better people in the process.
Well-Defined Vision
Motorola need to have a new well-defined vision. A corporate vision is a scripted
understanding of what a company wants to do and how they want to accomplish it. A well-
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defined vision allows members of an organization to unite for a common cause who singular
aim and all energy focused in one direction.
Relevant Knowledge of the Business Market
Motorola need tohave relevant knowledge of the business market. In order to do anything well,
a person or company must do their homework to gain a deep understanding about the factors
that are essential for success. These days as the World Wide Web continues to expand, there
is no excuse for a would-be to lack knowledge of whatever technology business they feel led
to pursue. Sadly, many businesses are dead out of the gate because they do not take the time
to gain a proper perspective on the mobile industry.
Detailed Business Plan
Motorola need toformulate a comprehensive business plan. Knowing about an industry and
sketching out a vision is only the beginning. The next step for Motorola Company is to take
what they know and what they want to accomplish and write a detailed strategy for how to
make it happen. A business plan covers all the related factors that are essential for a winning
enterprise including vision, description of the market, projected financials, employee
relationships and customer relations management (CRM).
Effective Change Management for Motorola
For any change management to adopt in the company, first of all, the organisation needs to be
ready which is assessing organizational readiness. Motorola need to evaluate the high level
impact of change, identify key points of risk and plans to address them.
Next is Motorola need to develop a future state vision by Articulate the change in a concise
and compelling manner that can be shared broadly.
Then, the company need to engage leaders. The Leaders will develop a plan to gain the buy-in
and support of those individuals most critical to success.
Of course the most important thing for any hierarchy of management is to Communicate.
Motorola need to develop a proper communication strategy and roll-out plan to create
understanding and drive acceptance internally and externally.
Apart of the restructuring in the top management, Staff transition also needed. Humana
Resource department of Motorola need to develop plans for staff transition, redeployment,
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separations and talent retention in order for the company to come up with a new direction in
the market.
In the changes, Motorola have to ensure to facilitate individual change from top to bottom by
building change adaptability skills and help individuals internalize and move through the
change to avoid anyone from missing out of the trend and understand the need for the change.
Into this, the management also need to create organizational alignment by evaluating relevant
programs and business policies, to identify points of incongruence and develop plans for
alignment.
Furthermore, Motorola need to set up proper training and development for the employees.
Develop a training strategy to create proficiency for operating under the new model.
Last but not least is to monitor and remediate the performance and result bymeasuring
adoption and performance and develop strategies to address problems that occur. Take a good
reference on it and make improvement.
Conclusion
In summary, for the year coming of Motorola Company, I hope that Motorola successfully
adopt and adapt the change management by restructuring it by proper reengineering their
process not only on product but also their marketing to remain competitive advantages in the
mobile device market. With the recommended new transformation will actually new Motorola
to stand another chance for their product differentiation and market differentiation instead of
competing in price and cost. Motorola need to understand that the globalisation happening
around which is to understand what is the needs and demands instead of working in research
and development but not knowing the market demand. New creation and innovation are the
keywords for Motorola to enter the mobile device market. Such reasons like faster internet
speed, more apps, more mobile function and so that highly popular Android smartphones, the
electronics veteran has brought innovation, excitement and experience to the world of mobile
communication.
To make the changes successfully, internal and external cooperation of Motorola Company
are needed with strong relationship including shareholders and stakeholders, to keep the
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sustainable advantages of the company and its product.
References
Books, Journals, Magazines
Motorola, 2009, A Timeline Overview of Motorola History 1928-2009
N. Fred, 2010, Four Change Management Strategies
Online Resources
Consumer Psychologist.com 2009, Introduction of Marketing, available at:
http://www.consumerpsychologist.com/marketing_introduction.html, viewed on 14 April
2012
Extragsm.com, 2011, Gartner‟s Phone Market Share Report 2011, available at:
http://www.extragsm.com/news/gartner-s-phone-market-share-report-for-2011-i719.html,
viewed on 13 April 2012
Motorola Phones.com, 2010, History of Motorola Company, available at:
http://www.motorola-phones.com/motorola-history.html, viewed on: 12 April 2012
N. Fred, 2011, Embracing Resistance to Change, available at:
http://www.nickols.us/embracingresistance.htm, viewed on 13 April 2012
Appendix
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