Strategic Audit Of Motorola Corporation

Strategic Audit of Motorola Corporation

Motorola Corporation is a main supplier of wireless communication systems, wireless accessories, wireless handsets, digital entertainment devices, and broadband systems. They are well known for their MOTORAZR, MOTORIZR Z3, and MOTOKRZR handsets and are the only provider of iDEN network to Sprint Nextel which uses infrastructure equipment. They also are leading providers for the delivery of networks which are used in the delivery of video, voice and data services. Their headquarters are in Schaumburg, IL and operates in the United States with 66,000 employees (Motorola, inc., 2007).

Motorola builds and promotes products, services and applications that make it easy to connect to people, entertainment and information possibilities through broadband, systems and wireless networks. The various business divisions of the company are the mobile devices, enterprise and network, and the connected home solutions. Their strong market position provides major investments in research and development (Motorola, inc., 2007).

Motorola Mission Statement

Motorola’s mission is to benefit communities around the world by achieving strategic grants, developing strong community partnerships, advanced innovation and engaging their stakeholders (“Corporate”, 2008).

Strategic Alternatives and Recommendations

The Corporate Strategy of the Motorola Corporation deals with the three key factors below:

1. Directional Strategy вЂ" the firm’s overall orientation toward growth, stability, or retrenchment.

2. Portfolio Strategy вЂ" the markets or industries in which the company competes with its products and business units.

3. Parenting Strategy- How the management coordinates their activities and transfers their resources and cultivates their product lines and business units (Hunger & Wheelen, 2007).

The three alternatives to ensure Motorola’s long term success follow the directional strategy. Despite their difficulties in 2006, they are the largest vendor and a leading provider in mission-critical systems worldwide with over 65 years of experience in complex network design, voice and broadband data, sophisticated technology, public and private networks, rugged devices, and optimization and implementation. They are also the leading provider of digital cable boxes in North America. Their strong market position follows the directional strategy for growth and stability in addition to their heavy investment in research and development (Motorola, inc., 2007). The expected growth of Asian Pacific is to reach one billion in phone sales by 2009. The India market should surpass China in 2009 with 139 million units. With their affordable devices and increasing geographic penetration and with being a world’s leading manufacturer of mobile phones, whey will position themselves for these trends (Motorola, inc., 2007).

The stability of the company is maintained by their robust manufacturing capabilities and facilities. They own and contract manufacturing facilities in China, Singapore, Brazil and distribution centers in Malaysia, Germany, China, Israel, England, and the United States. Their home solution manufacturing facilities are in Mexico, Nogales, Taiwan, and Taipei. They also contract manufacturers primarily in China for their cable/voice module production. Their global manufacturing network combined with their experience enables them to effectively meet customer demands while achieving a competitive advantage over their competitors (Motorola, inc., 2007).

The retrenchment strategies are geared toward maximizing profits in the company due to a weak competitive position in some or all of their product lines which results in poor performance. Stu Reed, the former Mobile Devise division president left Motorola after assisting the company with turning around the handset business. The handset business has been suffering for more than one year and Motorola recently lost its place as the second largest global phone vender behind Nokia Corporation (Jones, 2008).

The recommended strategy is for Motorola to continue to promote consumer knowledge and growth of its product line. Since Motorola strives to be competitive and utilizes the constant changes in technology, the growth of the company will continue to rely on its research and development (R&D) for new products, the production of its engineering capabilities and while improving their existing line of products. They invested in their R&D expenditures; $4.4 billion in 2007 compared to $4.1 billion in 2006 and $3.5 billion in 2005 which demonstrates their drive for long-term growth (2007 Annual Report, 2008).

Motorola’s Implementation Strategy

In the past, Motorola has relied primarily on their R&D programs for the development of new products and improving the production of their existing products (2007 Annual Report, 2008). Programs, budgets, and procedures are needed to exchange technical data and product application on a regular basis. Looking forward, management needs to identify who will be carrying out these strategic plans, what must be done, and how are they going to do what is necessary to remain competitive in this industry. Restructuring will help the marketing rise and continue with their brand development and categorize their business into three divisions: Mobile Devices, Home and Networks Mobility, and Enterprise