Recently I saw an article that celebrated the fact that it has been 25 years since the first digital cellular system and phone were invented by Motorola. Back in its glory days, Motorola also invented such things as car radios, military radios, and was the company responsible for bringing Six Sigma to the USA. On the other hand, by late 2003, it was a struggling, confused company with no clear game plan for winning. The CEO at that juncture was Chris Galvin, having been appointed to that position in 1997. He was the third Galvin to run Motorola and his grandfather, Paul Galvin, started the firm in 1928.
During Chris Galvin’s years as CEO, from 1997 to 2003, Motorola had made some disastrous mistakes. He oversaw the launch of the Iridium satellite phone system, which cost Motorola $2.6 billion before it was scrapped. He clung to the money-losing semi-conductor division despite the board’s insistence that he sell it. Perhaps worse, he allowed the company to miss the transition in the late 1990’s from analog cell phones to digital ones (which they invented, as noted earlier), enabling Nokia to blow past Motorola in handset market share.
Given this long list of failures and no convincing game plan for turning things around, motivation among employees by late 2003 was at an all-time low. Finally the board woke up and replaced Chris.
So what’s the learning from this sad story of an American icon gone bad?
1.) Beware of Foggy Goals – Employees really lose their spirit when it’s not at all clear how the organization is going to win in the future.
2.) Beware of Friends and Relatives – Chris Galvin was given 6 years to show what he could do with Motorola and that’s far too long of a runway. On the other hand, given that he was a Galvin, I suspect that the board was very reluctant to criticize Chris until Motorola was really in a disastrous position.
3.) Quickly Kill Things that Aren’t Working – Motorola was in too many businesses and it should have sold or shut down what hadn’t been working and focused on its real potential, which was the cell phone business.
4.) Vigorously Jump on New Ideas – It is a crime how Motorola would invent things but not quickly follow up and organize for success so that new invention could become a marketplace success. Things simply moved way too slow because the leader wasn’t supplying the energy.
The sad thing is that you see these problems of foggy goals, personal favoritism, lack of priorities, and low energy all the time. Gutsy leaders need to keep in mind that these are human tendencies that they need to fight every step of the way.