Global Market Strategist Required To Realign Disparate Business Segments, Synchronize R&D with Product Market Realities
Boston, MA & London, England - September 25, 2003 - In reaction to the recent announcement of Chris Galvin's retirement from Motorola, Strategy Analytics, the global research and consulting firm, believes that, while he has been highly successful at establishing internal cost cutting efficiencies with the six sigma cost control initiatives, an externally focused, market planner is needed to leverage expertise and brand effectively across groups to drive total corporate success.
"The new leader of Motorola needs to take a hard look at corporate strategy and be willing to divest properties that do not maximize long-term corporate growth potential," says David Kerr, Vice President, Strategy Analytics Global Wireless Practice. "The new leader must decide how Motorola will optimize its portfolio of businesses. Will it regain handset leadership, be a semiconductor powerhouse, a networking leader, or a volume contract electronics manufacturer?"
Motorola would benefit from retaining and bolstering its Semiconductor Products Segment (SPS), which Strategy Analytics views as a pivotal component underpinning long term innovation in cellular feature phones and multimedia devices.
Moving forward, the battlegrounds will be for embedded intelligence across the spectrum of consumer electronics terminals on the network edge, and Motorola's SPS Group should move aggressively away from reliance on its handset group for success in these markets.
Motorola should jettison its Global Telecom Solutions (GTS) Segment and exit the overcrowded infrastructure market.
While sales price is a consideration, in infrastructure, Motorola faces huge hurdles:
* It is a laggard in 3G;
* The timing for recovery of capex investment is uncertain;
* Profits for technology providers to wireless and fixed operators will come from applications software, not hardware in which Motorola is historically strong.
Motorola should retain its Personal Communications Segment.
It has been able to define lucrative market opportunities but has been ineffective in establishing profitable long-term market strategies to capitalize on them. Strong, consistent visionary leadership can overcome this problem. Despite its platform efficiencies, the company still lags on delivering new products including critical carrier defined features, specifically camera phones and MMS terminals. In addition, the group has yet to define a clear, consistent vision for carriers of the mobile terminals market beyond messaging and 2.5G consumer gaming and entertainment.
"Synchronizing R &D spend with next wave market realities, and enhancing their understanding of product replacement dynamics, are critical for Motorola moving forward," notes Chris Ambrosio, Director, Wireless Device Strategies at Strategy Analytics.
Motorola should retain its Broadband Communications Segment (BCS).
Strategy Analytics believes that Motorola BCS is a market leader in its focus on products that enable home entertainment networking between PC, video and wireless products. This is an area where Motorola has a distinct lead over some PC and CE manufacturers, and new management can exploit such an advantage to offset the cable industry's shift away from proprietary solutions and its over-reliance on the North American market.
For additional commentary and analysis on Motorola, please contact the following Strategy Analytics analysts:
US:
David Kerr, +1 617 614 0720, dkerr@strategyanalytics.com
Chris Ambrosio, +1 617 614 0723, cambrosio@strategyanalytics.com
European Contact:
David Mercer, +44 (0) 1908 423 610, dmercer@strategyanalytics.com
About Strategy Analytics
Strategy Analytics, Inc., a global research and consulting firm, provides timely insights and strategic business solutions to companies operating at the convergence of information, communications and entertainment technologies. With worldwide headquarters in Newton, MA and principal offices in England, France and Germany, Strategy Analytics focuses on market opportunities and challenges in the areas of Automotive Electronics, Broadband, Telematics, Wireless Strategies and Enabling Technologies. For more information, see http://www.strategyanalytics.com
|
