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... motorola is a main supplier of wireless infrastructure products, the support equipment that makes pagers, two-way radio systems, and cellular phones operate. The main source of revenue is typically from major telephone companies that place large orders to update or expand their network infrastructure. These customers seek innovative technologies that require significant investment in R& amp; D. Economies of scale provide the bigger equipment manufacturers with a competitive edge in pricing when filling such large orders.
Motorola also receives a significant amount of business from individual or personal subscribers. Motorola's main competitors in the wireless infrastructure sector are Nokia and Erickson, along with Lucent and Nortel. The competitive environment for communications equipment requires that vendors offer attractive financing terms to their customers as an important part of their sales packages. Motorola leads the cable modem market with a 41 % share, followed by Toshiba Corp. at 18 %, and Thomson Multimedia at 13 %. With intense pricing competition pricing pressure was as strong as ever in 2002 in such markets as wireless handsets.
New competitors in the field such as Samsung and Siemens have helped to speed up the pace of innovation by pressuring established companies to protect their market share. Rapid technology gains and product innovations by Motorola's rivals in wireless communications, combined with a downturn in demand for semiconductors and pagers, and an economic slowdown in parts of Asia have contributed to hurt the revenue and profitability of Motorola as well as a lack of a competitive digital product in the Asian market. For example, digital phones in Asia did not work on GSM (global standard for mobile communications). Motorola has lost a number of contracts and customers due to poor switching capabilities of its digital equipment. Motorola has made poor management decisions and has focused on the wrong products in these markets. In order to improve market share and revenue earnings, Motorola re-organized into three major enterprises to reduce inter divisional competition, encourage sharing of ideas, reduce development costs, and coordinate actions between Motorola's business units.
A major problem Motorola faced though was a decentralized approach to running its different businesses and divisions. Motorola had approximately 90, 000 employees that speak more than 50 different languages and belong to as many or more cultures. These employees must be educated on other cultures' beliefs, customs, and ways of life. Unfortunately, Motorola, along with many other companies in the industry, forced to make workforce reductions to remain competitive, laid-off 32, 000 employees in 2001, equaling approximately 22 % of their entire workforce. Most of the major communications infrastructure manufacturers maintain significant operations overseas. Motorola, along with other companies, are subject to foreign economies and currency risks.
Firms based in the United States with overseas sales translate from local currencies into dollars so a strong US dollar hurts reported earnings and a weaker US dollar helps. Motorola must also keep a careful watch on other specific risks such as the affects of protectionism, fluctuations in economic growth, and political instability when investing in foreign countries. The Foreign Corrupt Practices Act is another concrete law that must be followed by Motorola to its fullest extent and the knowledge that what is considered unacceptable business practices in the United States is considered acceptable elsewhere. Internal Environment Organizational Aspects One key issue that surfaces when one analyzes Motorola's organization is its decentralized approach to running its different business and divisions. Divisions are generally headed by strong managers and operated as virtual fiefdoms, pursuing their own agendas and priorities.
Divisions are often not cooperative or responsive to the requests and needs of sister divisions, and are look on by outsiders as "warring tribes" (James, 2003). Another characteristic of Motorola's leadership culture is its engineering base. Most of Motorola's key executives are well versed in technology, and over time, the company has developed a high level of technological and engineering expertise. For many decades, this has looked as an advantage because this is the reason that Motorola has been able to stay on the cutting edge of technological advances. However, at the beginning of 1990 's, some observers viewed Motorola's technology and engineering-based culture as a liability in a world that they saw as increasingly driven by marketing. In addition, some people have viewed the company's top executives as insular and tradition bound.
In 1998, 67 % of Motorola's top executives had been with the company for more than 20 years. This, to numerous critics, was a sign that Motorola was out of touch at the top. Marketing Aspects Motorola markets its products in six different segments: The Personal Communications segment (32 % of 2002 sales), The Global Telecom Solutions Unit (20 %), The Commercial, Government and Industrial Solutions (13 %), The Broadband Communications segment (9 %), The Integrated Electronics System Sector segment (7 %) and The Semiconductor Products segment (15 %). They concentrate the majority of their marketing in wireless communications products. The company manufactures cellular products based on all three of the major digital standards: GSM, TDMA and CDMA. Motorola estimated that 425 million handsets were sold in 2002, up 13 % from the estimated 375 million units sold in 2001.
Motorola's current marketing slogan is "Intelligence Everywhere" (Motorola, 2003). They want to be able to offer communication solutions everywhere a potential customer can be found. The Company's Intelligence Everywhere solutions include software-enhanced wireless telephone and messaging, two-way radio products and systems, as well as networking and Internet-access products for consumers, network operators and commercial, government and industrial customers, end-to-end systems for the delivery of interactive digital video, voice and high-speed data solutions for broadband operators, embedded semiconductor solutions for customers in wireless communications, networking and transportation markets, and integrated electronic systems for automotive, telematics, industrial, telecommunications, computing and portable energy systems markets. Personal Communications Segment The Personal Communications segment (PCS) designs, manufactures, sells and services wireless subscriber equipment. Its wireless subscriber products include wireless handsets and personal two-way radios with related software and accessory products. The company markets its products worldwide to carriers and consumers through direct sales, distributors, dealers, retailers and, in certain markets, through licensees.
MXC Architecture Change The MXC architecture totally redesigns the mobile architecture to combine functions and offer high-performance. Mass-market mobile devices can be developed affordably on a platform the size of a postage stamp currently one-sixth the size of any other chip. The MXC architecture simplifies and reduces development times, drives new applications, increases carrier margins and speeds adoption of mobile devices by rethinking the architecture to remove current design roadblocks and reduce cost, complexity, size, power consumption and part count. It will open new markets for the next generation of "smart" mobile devices and consumer electronics. SWOT Analysis STRENGTHSWEAKNESSESOPPORTUNITIESTHREATS Brand recognition No clear strategic direction Fiber optic cables Shift in buyer needs to alternatives Superior hardware Internal operating problems Form strategic alliances Loss of sales due to substitute products and services Attractive customer base Weak income statements Concentrate on R& amp; D Slowdowns in market growth Important patents, copyrights, usage rights Low profitability Increase market share Adverse shifts in foreign currency and economies Ethical Business Practices Strong ethical biases Many marker participants Loss of customers Intellectual capital Growing bargaining power of customers Wide geographic coverage/ International coverage Management style Sophisticated use of e-business technology Lagging digital cell phone technology Innovation Low employee education, training, motivation, and morale Learn from the Japanese Competition in the Vietnam Market from L G Information Communications Marketing development Quality of its products Take part in joint ventures, new alliances Japan has been allowed to enter U.
S. markets with few barriers Software development A reputation of lacking a strategy Increase reputation Hard to penetrate Japanese markets Their passion, openness of executives, acquisitions, mergers, and business alliances are also part of Motorola s Strengths Overall quality of its operations Untapped market opportunities around the world Japanese Competitors have flooded the market with low- prices high quality products Table 1 III. Core Competencies Motorola, Inc. has two core competencies, integrated communications and embedded electronics. "Their core products include wireless, broadband and automotive communications technologies and embedded electronic products" (web). Wireless Motorola offers three wireless platforms, 2 G, 2. 5 G and 3 G total systems solutions. The systems "[f]eating fully integrated hardware, software, and support services, this platform enables the rapid development and deployment of cost-effective GSM handsets.
The platform is flexible and scalable: it can support the high-volume production of economical phones as well as the use of higher-tier feature sets, and it provides a seamless migration path to the i. 250 - 20 /i. 250 - 21 platforms and next-generation technology" (taxonomy. jsp). These platforms use i. MX & amp; Dragonball Applications processors used in wireless devises including smart phones and wireless PDA's. Broadband "Motorola's Broadband Communications Sector has a vision for the future. This vision is strategically focused upon the potential of broadband solutions for the delivery of voice, video and data over HFC networks" (broadband.
motorola. com / no flash /bcs overview. html). They have the ability to deliver digital video, high-speed internet access, and end-to-end solutions for wireless, cable and satellite networks. Automotive Motorola's automotive products consist of Telematics, Automotive and Global Positioning units. "Motorola combines automotive-grade wireless communications, GPS technology and embedded computing to deliver the smart solutions, up-to-the minute information and peace of mind that drivers demand. With more than 1. 5 million telematics systems shipped worldwide to date, Motorola is leading the charge to take you further into the future, faster than ever before" (web telematics.
html). Embedded Electronic Products "As the world's # 1 producer of embedded processors, Motorola's Semiconductor Products Sector creates Digital DNA& amp; reg; system-on-chip solutions for a connected world" (web telematics. html). Embedded electronics can be found in Motorola's automotive, network and wireless products.
IV. Technology Innovation Motorola's strategy is .".. to become a global leader in wireless, broadband and automotive communications technologies and embedded electronic products. " They have been able to accomplish this goal by maintaining a continuous focus on research and development and dividing this product sector into smaller business units. Motorola's semiconductor product sector is divided into five business units: technology & amp; manufacturing, wireless & amp; broadband networking, transportation & amp; standard products, global sales & amp; support and "Metrowerks" (see figure 5). Figure 5 The Technology & amp; Manufacturing (T& amp; M) organization is focused on the entire lifecycle of the product from research and development to the product reaching the customer. "Leadership technologies provided include silicon germanium carbon (SiGe: C), SMARTMOS& amp; reg; technology, gallium arsenide (GaAs), Bi CMOS and embedded memories including magneto resistive random access memory (MRAM) " (e- web ABOUTUS TECH. html).
Motorola has teamed with STMicrolectronics and Philips to research complementary metal oxide semiconductor (CMOS). Motorola believes that "[u]sing a combination of strategic internal and external manufacturing sources, Motorola provides flexible manufacturing to meet changing market needs" (e- web ABOUTUS TECH. html).
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