Motorola changed CEOs, but its culture lives on

Motorola is in trouble again. Despite forcing out the founding Galvin family and bringing in a highly-regarded outsider, Ed Zander, Motorola finds itself where it's been numerous times in its history--suffering because it couldn't follow up a hit product. In this case, where to go after the RAZR?

In a front-page article in today's Wall Street Journal (link - $$), writers Christopher Rhoads and Li Yuan review what got Motorola into its latest crisis--and find that it's a movie that Motorola-watchers have seen before. Rhoads and Yuan write:

As the Razr grew hot, some former designers and engineers say Motorola repeated mistakes it had made a decade earlier with another big hit, the compact flip-top phone known as the StarTAC. That phone was a huge seller, but it also was an analog phone, and its popularity blinded the company to an industry shift to digital technology. Similarly, while Motorola was selling countless Razrs, competitors were hard at work on more sophisticated products for 3G networks.

Zander was brought in to change "a culture he saw as inward and bureaucratic," yet he encountered a power struggle between the handset division president and an underling right away and seemed unable to defuse it. A year later, the division president left and his rival, Ron Garriques, replaced him. Garriques scrapped much of the ongoing development work his predecessor had authorized, and started afresh. Whatever the personal, business or technical reasons for the change, it had a nasty side effect--Motorola fell dangerously behind in developing 3G-capable handsets.

And now Zander is on the ropes, fighting for survival. Whether he stays or goes, the CEO of Motorola will have to confront how to harness its technical brilliance in service of great products that customers need, instead of ones that executives favor.

product development, wireless, organizational behavior, culture