Few companies have flown so high — or dropped so low — in the last five years than communications technology giant Motorola. In addition to incredibly lucrative broadband, enterprise, and government businesses, the organization’s consumer cell phone division ruled the market in 2004 and 2005 as the ultra-slim MOTO RAZR became the most desirable and popular flip phone in the world. But just as it got to the top, Motorola began to slip. New phones didn’t click with consumers. Rather than coming up with more compelling and high-value handsets, the company focused on putting out more variations on the RAZR. Things got much worse in 2007, as the arrival of the iPhone highlighted further that the RAZR had little to offer beyond its flashy design. Things got so bad last year that Motorola, once the dominant player in the American market, almost sold off its mobile phone division.
Why did this happen?
According to a BusinessWeek interview with Motorola’s current Co-CEO, Greg Brown, an insular culture deserves much of the blame — and the RAZR’s success blinded the company to how vulnerable it was to the competition. This passage is particularly telling:
“Was hubris, born of Motorola’s Razr success, a factor in Motorola’s decline?
I think success is one of the biggest impediments to growth. It can be blinding. It can reinforce a historical or traditional way of doing things.
What do you mean?
Sustainable success has to be earned every day. And sometimes, a hit product can mask the brutal reality that more work needs to be done. I also believe that successful organizations have an “outside in” perspective. They are consistently looking at their work and the results through the lens of their customers or investors.
How did Motorola stray from this approach?
In Motorola’s case, historically we viewed things inside out as opposed to outside in. And at certain points in our history we developed an unhealthy hubris that manifested itself in us thinking we knew what was best for customers, as opposed to listening in an unfiltered and unemotional way to what customers were telling us.
Give me an example.
It’s particularly noteworthy on the mobile-devices side. We should have been more in tune with the customer experience instead of focusing on form factors [the physical shape of the phone]. We didn’t adapt with the right level of speed and customer input to where the puck was going.”
Absolutely fascinating. Brown is speaking the language of empathy — and blaming the firm’s “We know best” attitude for bringing out a succession of phones that just missed the mark. We agree with everything he said — if you want to win, you start outside in. If you understand and connect with people on their terms, you can much more easily anticipate where they will be in a few years. When you begin to believe that you’re a genius, you ship out another RAZR — now available in red.
Great interview. Read all about it!