Showing posts with label Motorola. Show all posts
Showing posts with label Motorola. Show all posts

Saturday, February 09, 2013

2008=#20 2010=#3 2012=#_?

Two years back, Micromax was a name heard by few and seen by fewer. Exhibiting a rare example of brilliant innovation combined with common sense, today it rules the world of advertising and has climbed to the number 3 spot in the domestic handset market. What next? by Surbhi Chawla

Of late, the Indian handset market has been flooded with a plethora of indigenous handset brands, which bear the stamp of companies that would have dumbfounded most acclaimed au faits as recently as a year ago. But these so criticised infantile firms have taught the masters of the mobile handset game (read: Nokia, Samsung, Motorola) how to ride the stalking-horse in the face of hell-raising competition. They have been successful in bringing to life the dormant aspirational values of many in the country, offering them “value for money” look-alikes of the best of handsets that the Indian Daddy Warbucks could afford. Their secret — they understand the psyche of the Indian consumer and deliver by “keeping it real fake”.

But as it occurs in many a fairy tale, there are the suitors, but there is just one real prince who walks away with all the glory and honour... and most importantly, wins the hand of the princess! In this race too, there appears to be one real prince for the moment – Micromax. And it is loud about not being a follower of the "keeping it real fake" cult. At present, Micromax offers 34 handsets in the Indian market. According to reports by tech-watchers at IDC, it is the third-largest handset vendor behind Nokia and Samsung. Some rise for a brand in the ghastly cluttered Indian handset market. So far so good. But will this north-bound express train gather greater momentum in the times to come? Some would debate, but considering the pace at which the industry has progressed in the recent past, Micromax may well be on its way to finding its name amongst the top two vendors in the country. According to IDC India, the number of handsets sold in the country touched 100.9 million units during the 12-month period ended June 30, 2009, registering a yoy growth of 6.7%. As the per capita income rises by the day, and as educational reforms make the common Indian more privileged, aspiration levels will rise, thus it will rise the demand for more handsets. In short – Micromax is in for a great ride along with other newbies.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

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Thursday, November 15, 2012

CEO PROFILE: GREGORY S. BROWN, CEO, MOTOROLA INC.

Aren’t four months a tad too little to turnaround a troubled company drenched with losses?

Under him, the $6.7 billion government and corp. comm. divisions have grown by a CAGR of 10% and its profitability too has doubled. Furthermore, he successfully led the acquisition of Symbol Technologies for $3.9 billion – the second-largest deal in the history of Motorola! Greg also turned around the automotive unit & consequently led its sell off for $1 billion to Continental.

Surely, Moto’s handset division can be given to a new leader, but Brown’s leadership for the other division is necessary. Even Jack Gold, J. Gold Associates agrees, “A new leader is required to run the newly-formed handset division. It must bring in new blood to stir things up and get the innovation cycle moving again...” Surely, Motorola has decided it must reorganise itself, and part of this process must be a top-down review of its total business game. Kagan, too, agrees on the same as he says, “I think Motorola can recover with the right CEO and the right attitude. I think that with the right leadership, they can recover and do well.” Brown’s previous tenure as a CEO at Micromuse saw him increase revenue by a teeth-rattling 809% to over $200 million, which critics should not overlook! Especially when experts like John Thompson, Vice Chairman, Heidrick & Struggles, too have generously tagged him as “highly talented’ and that he “has the personal bandwidth to be CEO of a Fortune 50 company.” As far as the split is concerned, Greg will surely lose control over the handset division; but then given a choice, he too would have chosen ‘quality’ work over ‘quantity’ work. Well, nothing wrong in giving up what you can’t handle.
 

Source : IIPM Editorial, 2012.

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Friday, October 05, 2012

Motorola – Hard to Ignore, Hard to See!

The Erstwhile No.1 maker of Cellphones is Today, Only a Shadow of its past. And there is a Sense that something will not end well. But new CEO Sanjay Jha’s Android bet has pumped-in a Fresh Breath of Life into Motorola. The Issue is – it’s only One Breath.

For Sanjay Jha, taking charge of Motorola’s Mobile Devices division, two years back, was much like Alan Roger Mulally (the erstwhile Boeing chief) accepting the role of playing the saviour to the ailing Ford Motors (which Mulally managed quite brilliantly, without any aid from the Obama Senate!). It was a completely new ball game for Jha, with many differences of dynamics underlining his past record as the COO who ensured that Qualcomm becomes the global #1 maker of semiconductor chips for mobility devices, and future expectations that he would rescue Motorola, which during its heydays, marched around selling mobile handsets with authority. Distrust was rampant, as he realised during his first meeting, on day #1 at Motorola’s headquarter at Libertyville, Illinois, in August 2008. “Why should we trust you?” asked an employee. Jha chose not to respond, for he knew there was still one person who believed in his competence to save a plummeting stock and a fading future. He was that person. Motorola, which was once the #1 mobile handset maker, had lost the top spot to Nokia in the fall of 1998. Six years later, Samsung displaced it as the new #2. When Jha took over, the company, with 10% of global handset market share (falling from 14.5%, during the same quarter a year back), it stood at #3 (figures for Q2, 2008). After the Razr, there had been no hit roll-out, and the American, besides losing share to Asian and European counterparts, had shed $37 billion in Mcap in the past year-and-a-half. Jha had to brace himself up to sort through the rubble that Motorola had turned into. That, he got a good taste of, during an evening meeting on his 13th day in office. He was meeting the top brass at Vodafone, to discuss a possible multi-billion dollar alliance. Jha confidently put three very new, innovative and intelligent but complicated and yet to be designed product ideas before them. To that, one of the Vodafone executive responded – “Could you please pick one device and let me know what you think I should buy?” The response was obviously dripping with sarcasm – the deal never happened and Jha was left dry. Till date (over the past 27 months), Jha has taken home $28.2 million for every 1% decline of the Motorola share price. Expensive money. And the shareholders? A fall of 51% in Mcap (which has fallen to $19.19 billion as on November 10, 2010) during his reign, is all they get in the name of a celebration cake.

This is no mere squabble. Today, as the number of handsets in service is headed towards the 5 billion mark (which it will cross by 2011, as per the Yankee Group), Motorola still finds itself in the middle of the river. But some things have changed over time. Here’s a screen-shot. After years of stressing on innovation which the market never desired, Motorola had products which used 22 different screen displays, each of which required different software, implying higher costs and longer time to market. There were many such discrepancies. Jha went about putting the house in order. He fired employees, turned to smartphones, embraced the Android OS, got a tie-up going with Google and Verizon, and even started laying the platform for a possible two-way split of the Handset and the Enterprise Mobility Services divisions by 2011. And despite the financial heartaches, the investors are quite getting to like Jha. His Android bet has worked, and Motorola’s single-largest pride – the mobile unit – has reported a profitable comeback in the third quarter ended September 2010. Most importantly, after half-a-decade of continous decline in topline, the devices division is all set to record a y-o-y increase in annual revenues (estimated at 12.8% y-o-y for FY2010 and 18.2% for FY2011, as per Credit Suisse). Bottomlines will grow healthy too. After filing accumulated losses of $4.86 billion during the past three years, the company is set to record $382 million in net profits during FY2010, which is further forecasted to rise to $738 million in FY2011. While speaking to B&E from New York, Andrew Muench, Technology Analyst at Credit Suisse, says, “Following solid Q310 results, we adjust our EPS estimates to $0.36/ $0.60 for 2010/11. Given robust execution in all businesses, strong cash generation, Devices now profitable and separation on track, we see several catalysts for further outperformance. We now model Devices revenue of $9.5 billion in 2011, well above the break-even run rate just achieved.” Some relief.

While the Droid launch proved a winner for Motorola, the company displayed wisdom on the mix of smartphones it launched this year. Out of the 22 handsets, 9 are low-end, 5 are mid-end, while 8 fall in the high-end category. These therefore make for a fresh portfolio which can cater to all possible segments of the market, across geographies.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
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