Summary:
A business case study about Motorola and how it is trying to overcome continued lost of market share by using total quality management (TQM) to produce better financial results.
Case Study #1- Motorola
I. Introduction
In present day, Motorola is known to have a very profound brand name. With its extraordinary performance and consumer met needs, its global market place value is exceptionally strong. Its share values soaring over 47 percent more than last years (Weyrauch 1), its focus-oriented quality control has led to a decline in sales within the past years. Although "Motorola reported global revenues in excess of $22 billion in 1994, approximately 50 percent of which were a result of sales outside of the United States" (Managers, Diversity, and Change 1). "Competing closely with Hitachi for the number 2 ranking in the dynamic Asian chip market. Moreover, Motorola led all rivals in this same geographic market in sales of high-end walkie talkies, digital cordless telephones, and cellular communications subscribers" (Managers, Diversity, and Change 1). With company improvements made within management recently, has improved sales for Motorola. With these problems in management seen throughout the companies' history, taking a closer look will show a better perspective of why Motorola had lost profits.
II. Statement of Problem
Looking at Motorola's strategies of management and the reasons why Motorola couldn't meet consumer demands, "Former CEO Robert Galvin announced to top management that the company needed to reorganize and become more customer oriented" (Managers, Diversity, and Change 1). "As a result, the firm was losing market share to Intel and other competitors" (Managers, Diversity, and Change 2).
III. Causes of Problem
As Motorola lacks management skills, its ability to perform is weakened and thus making it harder for employees to make deadlines. A manager should involve multidimensional thinking as an initial process to keep the goal of the project. "Analysts noted that Motorola was heavily focused on improved quality through a total quality program and expressed concern that a similar focus during the late 1980s, referred to as a the Six Sigma program, had led to problems of cost control and employee morale" (Managers, Diversity, and Change 1). "Motorola's foreign operations were managed by executives from the countries in which they were operating in keeping with the belief that local managers would have a better feel for what actions were necessary to improve their operations within the norms and values of their own cultures. It was something of surprise, therefore, that Motorola's semiconductor unit was performing so poorly near the end of the decade" (Managers, Diversity, and Change 2). "The companies commitment to quality was part of its problem--its desire to produce the highest quality products was causing its research and design engineers to delay introduction of new, advance products" (Managers, Diversity, and Change 2). As seen, Motorola's main issue is its focus on quality. This led to a decline in innovations and newer and more reliable products. As Motorola being a quality focus company, it takes them longer to invent therefore causing a loss in sales. This flaw is fatal to the company. It is the very reason why Intel is gaining revenue and Motorola is loosing. Motorola must adapt many management strategies in order to exceed Intel. With better management will come better results.
IV. Solutions & Implementation
As Motorola must improve its flaws, there are many ways to go about. "To meet this competitive pressure might mean compromising the company's commitment to quality as a means to achieving customer satisfaction and consequently, would require a change within the culture of the company as a whole" (Managers, Diversity, and Change 2). In order for Motorola to succeed it must induce Total Quality Management (TQM). This technique is very unique. Not only does it produce results, it brings quality within your products. As the Americans learned from the Japanese what TQM was, it placed a new level on the standard of American cars. This is needed very much in Motorola. A quality-confronted company must be able to produce quality within time. The every essential of time is crucial to there operations. As the famous saying goes, "Time is Money" it very well is an enormous role within Motorola. Other ways of improving management would be the manger themselves. A manager is a key role in production and a company's outcome. It is a manager who is the sprint, the commitment, and the determined. The action of a manager is the very result of your product.
V. Justification
Implying TQM would only benefit the company. "Most of the management at Motorola appeared to be receptive to the changes that had taken place with the company and felt that a continued commitment to quality was necessary to maintain the growth of the company" (Managers, Diversity, and Change 2). Although Motorola had a pervious quality program, it proved to be unsuccessful. This implication of TQM, started by the Japanese, would only mean success for the company. Its standards would be set high and their product outcome would be nonetheless quality. "Management believed that for every dollar spent on training, the company received 30 dollars in benefits and improvements from its employees" (Managers, Diversity, and Change 2). This just shows that the more money spent on the process of quality training, the more money earned from its results. This cutting-edge process is known to be very effective and guaranteed to show results. Keeping in mind that a manager must be positive and willing to adapt managerial skills, learning and communicating are the basics of management. It is only when you master the basic do you learn to rise. Just as a toddler must learn to crawl before it walks, and within time he learns to run. This bulletproof strategy will only improve the company itself and make Motorola an efficient and yet quality known company.
VI. Conclusion
Motorola continues as the strong No. 2 player in the world's mobile device industry with an estimated 17.1 percent global market share (Weyrauch 1). With its quality performance and cutting-edge technology it has maintained a reputable company and one to invest in. "Management had turned what had been a low morale operation with increasing costs and defects into a world-class competitor" (Managers, Diversity, and Change 1). With its changes in effect Motorola has become a quality, a reliable, and cost-efficient product that is known worldwide.
