Will Motorola Rise From the Ashes?

An anonymous reader writes "According to ZDNET the once almighty Motorola is going to split into two companies, 'If the split goes through as planned, what will remain will be the "broadband and mobility solutions" business, which includes enterprise mobility, government and public safety, and Motorola's home and networks divisions.' Engadget claims to have an insider's email that details where it all went wrong, paying particular attention to mismanagement at the highest levels. What makes all of this even more of a shame though is that Motorola's latest product lineup seems to be receiving critical acclaim but with the company in so much termoil, will it ever rise out of the ashes?"

Comments

One thing caught my eye

[antifoidulus]

In researching the myriad claims raised in this letter -- which we believe to be true -- we also discovered a number of other unsettling things about Motorola's corporate past in the last five years, such as certain gross corporate excesses demanded by Zander and his inner circle (like a small fleet of extravagant private jets, where most companies that size might only have one, if any), or the fact that Motorola's current CEO, Greg Brown, is so technologically out of touch he refuses to use a computer for communications, and has all his email correspondences printed by his secretary and replied to by dictation.

The sad thing is that this is way too common in American corporations today. Someone much smarter than I(I think it was in the Economist) remarked that the modern day American CEO doesn't get to the top because they have vision for great products, they get to the top because they are connected and are great at playing financial games. This makes for great short term gains at the expense of any sort of longevity(but by that point the CEO has his golden parachute and is long gone). Carl Icahn also lamented at how woefully out of touch the modern American CEO is, and how much their exorbitant salaries and total lack of accountability and vision make American companies so topheavy they are quickly becoming uncompetitive.

Motorola thought that it could farm everything out and somehow just sit back and reap the benefits of others labor. It was wrong, and yet others are lining up to jump off the same cliff that they leapt from....

Re:One thing caught my eye

[NeutronCowboy]

Yup. I can personally attest to that. At the last company, the CEO was forced out due to backdating shenanigans (i.e., the stock game that all tech companies in Silicon Valley played). The guy who took over promised at every meeting that he was prepared to take it to the next level, that we were going to kick everyone's butt, etc. Within one year, the company had been sold, and he probably took a 10million+ golden parachute into retirement (the company hadn't even gotten to $1billion in yearly sales) - all for having performed exactly one job; selling the company to someone else. Not only that, but the price for the company had been boosted by financial games with revenue recognition that looked great on paper for the next quarter, but which absolutely wrecked long-term sales. 2 years after takeover, we're finally recovering from the idiocy. It's only because we are the unquestioned leaders in a red-hot market that the company didn't just completely tank right after the sale.

Since then, I've had a very dim view of CEOs and the games they play. I've gotten to the point where I think that a number of companies succeed in spite of their CEOs, not because. Not only that, but the only time that CEOs are held accountable is if they've done something criminal. Being merely incompetent and raiding corporate coffers is enough to get awarded an 8 to 9 figure severance package. Personally, I compare it to someone joining a WoW guild, raiding the Guild bank for everything that's worth anything, and then being handed everyone's gold as an incentive to leave the guild. Despicable doesn't even come close to describing what I think of thse CEOs.

Re:One thing caught my eye

[MaWeiTao]

I've gotten the impression that one of the big reasons why American companies run into all these problems is because executives and management all have business or economic degrees. They don't really understand what it is the companies they run do, nor do they seem to care.

That's why we end up with companies like Chrysler hiring the former CEO of Home Depot as their new CEO. What in the hell does a home improvement retailer have to do with an automobile manufacturer? To these people everything is "product". It's an abstraction with no bearing on reality. This why they're so quick to outsource. It's why they're willing to dump obscene amounts of money into marketing instead of research and development. American companies seem to take more pride in "inventing" a brand than they do in producing a real product. Everything always comes off as a gimmick to sucker people into buying their products.

I think Motorola is plagued with the same problem as many other American companies face. They're looking for that one big hit. Instead of following a path of patient improvement and building the overall portfolio they bank everything on a single product. In the process they neglect everything else. When they do come upon something popular they then proceed to milk it to death. The media doesn't help with all their gushing on how the company has turned around their fortunes. They rest on their laurels and when consumers grow tired of the product they find themselves struggling all over again.

I expect Motorola to keep plodding along as they have in recent years. Although, I wouldn't be surprised if they decide to outsource their entire mobile phone business. More than that, they'll dump their design and R&D departments and instead just buy crap hones directly from the Chinese market and rebrand them as Motorolas. The twit responsible for this will be touted as an innovator. Some day the Chinese will realize they don't need American companies and start selling to consumers directly.

When it comes down to it, American companies are quickly turning themselves into nothing more than middlemen. I wouldn't be so bothered by what these CEOs earn if they actually contributed something of substance to these companies. Unfortunately they seem to exist only to make themselves and their shareholders wealthy.

Goodbye, Moto

[Anonymous Coward]

What makes all of this even more of a shame though is that Motorola's latest product lineup seems to be receiving critical acclaim

But so what?

In the US market, consumers have taken it as given that whatever interesting features a manufacturer builds into its hardware, the carriers will either disable them outright or make them into carrier-branded pay-per-use features.

Camera? Pseudo-GPS location services? Directions/navigation? Local restaurants? Even something as simple as using your PC's desktop wallpaper as a background image is pay-per-use. Web browser? Nope, pay-per-byte. Music/Video? Nope, browse your carrier's licensed pile of top 40 crap. Better mic/speaker for actually making phone calls? Nope, it's all compressed down to underwater-quality-burbling by the carriers anyway.

This situation isn't unique to Motorola; carrier lockdown has made wireless phones a commodity, and has threatened all manufacturers. What's the difference between a Motorola ABC or a Nokia XYZ when every potential differentiating feature has been disabled by every carrier?

Re:The Real Motorola Split in the 90s

[fatphil]

Moto split earlier this decade. Half of it (the semiconductor, comms stack, and automotive parts) became Freescale Semiconductor.

Frustrating Shame

[ewhac]

I worked at MOTO for two years. Though I wasn't in the mobile division, I got to see a bit of the sausage factory, and was there when the iPhone was announced last year.

It was obvious to me when Apple announced the iPhone that MOTO was going to have a problem on its hands in very short order. Although the pricing made it unaffordable for Joe Sixpack, it was immediately apparent that Apple had, at a single stroke, completely redefined the cell phone experience. Every mobile product that was more than eight months from release should have been killed immediately, and all the freed up personnel should have then stared at the iPhone demo video for two weeks straight until the UI principles became ingrained. New design ideas could have then flowed out of that. It could even have been done inexpensively.

Had they done that last year, they would have had new prototypes to show by now, they could have started generating buzz, and could have remained relevant. Now, it will take a hugely expensive effort to keep the division -- possibly the entire company -- afloat.

Schwab

Re:Frustrating Shame

[mr_lizard13]

I worked at MOTO for two years.
So you're to blame!

Re:The Real Motorola Split in the 90s

[frank_adrian314159]

... after they boot the incompetent upper management like HP booted Carly Fiorina...

Hey! Speaking of which - guess what she's doing now! Yet another reason to avoid McCain like the plague!

Wrong, yet modded +5 Insightful

[Anonymous Coward]

Moto split up in the 90s, 3com swallowed them.

Fact check please.

Ah, but it was said with such certitude...

Re:The Real Motorola Split in the 90s

[Grishnakh]

Not quite. A large part of their semiconductor business (mostly discrete, analog, etc.) became "On Semiconductor" (what a stupid name). The PPC stuff, RF stuff, and automotive stuff went to Freescale.

Re:The Real Motorola Split in the 90s

[Anonymous Coward]

I worked in Motorola's research labs for about 5 years. I've been out of that for the last year and a half.

My experience there was there was a lot of ideas being bounced around, and anytime one idea caught traction, Motorola would pander it around, loose interest, and sell it off to someone else to make a fortune on. Eventually, as Zander came on, Motorola drastically scaled back R&D, shutting down whole divisions doing hard science. Then, it came to pass that all R&D projects had to have a 'buyer' in one of the profit making sectors, which led to a scramble amongst the engineers. Suddenly folks were backstabbing one another to try to get a project that GEMS or mobile devices wanted done. I once tried to get the specs on a product that we were supposedly trying to hawk to consumers so I could extend the functionality, only to be ignored or strung out waiting for info. The constant 'fires' I had to put out just to get work done were grating.

I'm not surprised in the least about all this. The writing was on the wall when SPS split off into Freescale. Motorola just refuses to leverage any core competency at all. It's all about being tragically super cool to sell products.

I think mobile devices will tank unless they get someone in there to beat it into shape. GEMS, or what's left of Motorola now, will hang in only because they already have massive infrastructure for gov't and etc. If someone else got into this market, Motorola would be gone.

Free the Motorola 68000!

[jd]

(For those too young to remember, that is not an oblique open source joke. It's a managerial style joke.)

Seriously, Motorola would be trivial to turn around. I could manage it in a fraction of the time it would take most executives to, and I'm cheap at the price. So could many geeks who have a similarly broad-based background and no patience with waffling. (Waffling should be left to waffle irons.)

Of course, no geek capable of running Motorola will ever be offered the job. We're far too outspoken, way too radical, most (myself included) have never been contaminated with a Harvard business degree, and most (again myself included) have managed to avoid managerial roles because we can't stand having zombies as co-workers. (Holy water supersoakers aren't enough.

Motorola won't hire anyone dangerous enough to succeed. And this is a mission where you need someone who is dangerous, a wildcard, unpredictable. You don't hire a banker to pull off a commando raid, you don't hire a businessman to rescue a disintegrating corporate giant. If they had any sense, they'd be looking for a troublemaker. They WANT Motorola to cause trouble. Causing trouble means they're still breathing. This troublemaker must be able to come up with novel, irrational, but totally brilliant solutions to the current engineering problems. Only problem is, The Doctor doesn't like being pinned down like that.

There is one other option, which has a better chance of success. Start a new company, a company that, businesswise, should logically not exist, that makes no sense given current attitudes, but sells like nothing else. Then openly and outright offer each and every (decent) engineer at Motorola the option of jumping ship. Don't buy the IP, buy the workforce. What's Motorola going to do? Sue each person individually over non-compete? And will the courts even listen to such a case if Motorola isn't producing anything worth a damn to compete with? Yes, it's playing with fire, but look at every single brilliant engineer, every single brilliant company owner, anyone who has ever truly risen far enough above the masses to see anything worthwhile - they all played with fire, in the most insane and dangerous ways possible. And they made it work for them.