It certainly feels that way to the Galvins -- the family that built
and ran the company for most of its existence. Paul Galvin founded
Motorola; his son Bob Galvin made it huge; and the grandson, Chris Galvin,
was CEO from 1995 through 2003 -- when the board forced him to resign
under CEO Ed Zander. 
Motorola had a spurt of growth just after Chris Galvin left -- which
Galvin and a lot of others believe came from products Galvin had teed
up -- and performed pretty well through 2006. Since then, Moto's cell phone business has
sputtered and lost market share while its stock price has gone off a
cliff.
Chris Galvin recently told me that his family has sold 99% of their Moto holdings -- a devastating vote of no-confidence. "Motorola as an innovator is dead and cannot be retrieved," he said. Yes, of course, that could sound like sour grapes -- except that he might be right. Investor Carl Icahn has succeeded in putting short-term shareholder gain above everything, forcing Motorola into pieces that surely can't have the cultural strength or market impact of the whole.
Fourteen years ago, when Jim Collins and Jerry Porras wrote their groundbreaking book Built to Last, they included Motorola among just 18 global companies that had enduring top-shelf success. Moto was especially cited as a company that had a built-in mechanism for renewal. It periodically dipped into a difficult time, but found new businesses and exited old ones and got going again. It could do that because it had patient management -- the family that built the company. Once that was gone, crass shareholder returns took the lead.
Splitting into pieces doesn't seem like the same recipe that got Motorola onto the Built To Last list.
Motorola's individual businesses might do fine. Perhaps they'll surprise everyone and bounce back. But at the moment, the split seems like a giant step back from greatness -- and maybe a step toward that place where you'll find other once-iconic names like Polaroid, Westinghouse and Sears (SHLD).
This article has 2 comments:
When Zander came and appointed Garriques to lead mobile devices, Ron changed his mind about the RAZR. He then brought in a legion of Mckinsey consultants who created with him a plan to be "number 1 in 1000 days." It was based on the stupid idea of superficial, brown-nosing consultants that MOT could compete with NOK across the portfolio, including the low end, without addressing fundamental issues such as the silicon and software platforms.
Ironically, I guess the 1000 days are to be completed sometime around now. Has anyone asked McKinsey to give back the millions of dollars MOT paid, after all their plan failed?
It will be very difficult, perhaps impossible, to turn around MDB now. NOK and Samsung are not sitting back. MOT has made absolutely no progress resolving the software and silicon issues. The portfolio will not be competitive for the next several quarters either in the high end or in the low end, no matter what management does. It is hopeless....