In 1928 Paul Galvin founded the company as the “Galvin Manufacturing Corporation” in Chicago, Illinois. The first product launch, called a “battery eliminator” allowed radio consumers to operate directly from household current instead of the batteries supplied with earlier models. But the company’s name was soon displaced through its main product, “Motorola” radios, figurehead that conjures up the historical symbiosis of a mobile radio and a car (Agar, 2003). Under the leadership of Paul Galvin, Motorola became leader in military, space and commercial communications, grew as a manufacturer of consumer electronics and built its first semiconductor facility. The company founder died in 1959. As his successor Robert W. Galvin, P. Galvin’s son, was introduced. Within his leadership Motorola expanded into the international markets, and their object of view was shifted away from consumer electronics. As a fact of this challenge, the colour-TV receiver business was sold in the mid 70’s, so that they could concentrate their abilities on high-technology markets in commercial, industrial and government fields. With the 80’s ending, Motorola had become the doyen supplier of cellular phones. (www.motorola.com) You could say, that Motorola, Inc. is a global provider of wireless, broadband, automotive communications technologies and embedded electronic products. Further on the company provides 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. Motorola also provides end-to-end systems for the delivery of interactive digital video, voice and high-speed data solutions for broadband operators, and embedded semiconductor solutions for customers in wireless communications, networking and transportation markets. In addition, the company offers integrated electronic systems for the automotive, telematics, industrial, telecommunications, computing and portable energy systems markets. The last reported count of employees was 88.000. (www.yahoo.com) In most parts of my strategic analysis, I will focus on the Personal Communications Segment (PCS) of Motorola, the business group of Motorola’s cellular phones. Following Nokia, Motorola is the 2nd largest mobile phone producer worldwide.
Table of Contents
1. Introduction
2. An analysis of the relevant business environment of Motorola and its major competitors
2.1 Industry Environment-PEST-Analysis
2.2 Key factors for success and market structure
2.3 Position of major competitors
2.3.1 Nokia
2.3.2 Samsung Electronics
2.3.3 Siemens
2.4 Opportunities and Threats
2.4.1 Opportunities
2.4.2 Threats
3. An evaluation of Motorola’s resources
3.1 The value chain analysis
3.1.1 Marketing
3.1.2 Production
3.1.3 Research and Development
3.1.4 Financial Resources
3.1.5 Human Resources
3.2 Strengths and Weaknesses
3.2.1 Strengths
3.2.2 Weaknesses
4. Assessment of Motorola’s performance in terms of efficiency, effectiveness and return to investors
4.1 The Balanced Scorecard
4.1.1 The customer perspective
4.1.2 The internal business process perspective
4.1.3 The learning and growth perspective
4.1.4 The financial perspective
5. A review of the options available to Motorola’s PCS and recommendations for future strategic direction
5.1 Analysis of strategic options
5.1.1 Ansoff’s options matrix
5.2 Recommendations for future strategies
6. Recommendations for structures, systems and policies to implement these strategies successfully
7. Assessment of the usefulness of strategic management models for analysing Motorola
7.1 PEST-Analysis
7.2 Porter’s value chain analysis
7.3 The Balanced Scorecard
7.4 Ansoff’s market options matrix
8. Conclusion
Objectives & Core Topics
This report aims to conduct a comprehensive strategic analysis of Motorola, specifically focusing on its Personal Communications Segment (PCS). The primary research goal is to evaluate Motorola's competitive position, operational efficiency, and market strategy compared to industry leaders like Nokia and Samsung, ultimately providing recommendations for future strategic growth.
- Strategic environment analysis using the PEST framework
- Evaluation of competitive dynamics in the mobile phone industry
- Value chain analysis and resource assessment of Motorola
- Performance measurement using the Balanced Scorecard approach
- Strategic recommendations for future market positioning and operational efficiency
Excerpt from the Book
3.1.2 Production
Motorola’s PCS-headquarter is located in Libertyville, Illinois. The company’s major facilities are located in Plantation (Florida), Flensburg (Germany), Tianjin (China), Singapore and Jaguariuna (Brazil). Motorola is further on interested in two Korean cellular handset design and manufacturing firms and joint ventures in Hangzhou and Shanghai, China. During 2003, the company sold their manufacturing facility in Chihuahua, Mexico to Foxconn International Holdings Group, but they are contracting with Foxconn for the manufacture of certain products.
This trend is not only unique in the Motorola company, its happening in the whole mobile phone manufacturing sector. Motorola and some other companies use several electronics manufacturing suppliers (EMS) and original design-manufacturers (ODM) to enhance the ability to lower costs. Especially for Motorola, these third parties operate in non-Motorola facilities.
In 2003, nearly three-fourths of the Motorola cellular phones were manufactured in Asia, including products manufactured for the company by third parties. Motorola is expecting that this trend will continue throughout 2004. Exactly spoken, in 2003, these third parties manufactured approximately 20% of Motorola’s handsets. In 2004, this percentage is expected to increase to approximately 30%. (www.motorola.com)
The development of manufacturing mobile phones will change within the next years and twist the mobile value chain. Regarding to “Northstream” market-projections the suggestion is, that OMD products will account for more than 40% of the mobile handsets’ market until 2005. (www.northstream.se)
Whether this might be a successful strategy in terms of flexibility or a bottleneck factor of supply, this can only show the future. (www.motorola.com)
Summary of Chapters
1. Introduction: Provides a historical overview of Motorola from its founding as Galvin Manufacturing Corporation to its evolution as a global leader in cellular communications.
2. An analysis of the relevant business environment of Motorola and its major competitors: Analyzes the political, economic, social, and technological factors impacting the industry and reviews the market position of key competitors like Nokia and Samsung.
3. An evaluation of Motorola’s resources: Examines Motorola’s internal activities through Porter’s value chain analysis and assesses its strengths and weaknesses in areas like marketing, R&D, and HR.
4. Assessment of Motorola’s performance in terms of efficiency, effectiveness and return to investors: Evaluates the company’s overall performance using the Balanced Scorecard, focusing on customer, business process, learning, and financial perspectives.
5. A review of the options available to Motorola’s PCS and recommendations for future strategic direction: Uses Ansoff’s matrix to explore growth options and proposes strategic recommendations to regain market share.
6. Recommendations for structures, systems and policies to implement these strategies successfully: Discusses the transition in leadership under CEO Ed Zander and the organizational requirements for successfully executing future strategies.
7. Assessment of the usefulness of strategic management models for analysing Motorola: Reviews the practical applicability of PEST, value chain analysis, and the Balanced Scorecard in the context of the mobile industry.
8. Conclusion: Summarizes the report findings, noting Motorola’s need to focus on operational efficiency and timely product delivery to compete effectively in the global market.
Keywords
Motorola, Personal Communications Segment, Mobile Phone Industry, PEST Analysis, Value Chain Analysis, Balanced Scorecard, Market Share, Strategic Management, Cellular Handsets, Nokia, Samsung, Operational Efficiency, Research and Development, Ansoff Matrix, Global Telecommunications.
Frequently Asked Questions
What is the core focus of this report?
The report provides a deep strategic analysis of Motorola, focusing primarily on its Personal Communications Segment (PCS) and its competitive position within the mobile phone market.
What are the primary themes discussed in the analysis?
The main themes include external environmental impacts, internal value chain efficiency, comparative performance against industry leaders, and future strategic recommendations.
What is the main objective of the strategic study?
The objective is to identify why Motorola lost its market lead and what strategic, operational, and structural changes are necessary to regain market share and improve financial performance.
Which management models are applied in this document?
The report utilizes the PEST framework, Porter’s Value Chain, the Balanced Scorecard, and the Ansoff Market Options Matrix.
What does the main body cover?
The main body covers a PEST analysis, an evaluation of resources, a performance assessment using the Balanced Scorecard, and specific recommendations for future strategy and organizational restructuring.
Which keywords best characterize the work?
Key terms include Motorola, PCS, strategic management, mobile industry, PEST, value chain, and Balanced Scorecard.
How does the report view Motorola's R&D capabilities?
The report acknowledges Motorola's strong R&D history and innovation capacity, but criticizes the company for failing to align this technical expertise with customer demands and market timing.
What significance is attributed to the hiring of the new CEO, Ed Zander?
The report highlights Ed Zander's appointment as a turning point, emphasizing his role in potentially addressing the company's lack of efficiency and fostering a cultural shift toward customer-centric execution.
- Quote paper
- Marco März (Author), 2004, Analysis of Motorola's Personal Communications Segment, Munich, GRIN Verlag, https://www.grin.com/document/27493
