Why Laeder Fail and How to Succeed Motorola’s Former Ceo Christopher B. Galvin and Edward Zander
Contents Abstracti Executive summaryii Chapter I. Introduction1 Chapter II. Motorola’s Background (1928-2005)1 Chapter III. The Problem Why Leaders Fail – Christopher B. Galvin2 Chapter IV. How to be successful again – Edward Zander5 Chapter V. Conclusion7 References9 Abstract This article discussed the reasons why leader fail by studying Motorola’s former leaders. Christopher B. Galvin was Motorola’s chief executive officer from 1999 to 2003. As third generation of Galvin family, Christopher inherited the leadership of a huge corporation that was profoundly troubled by market place shifts and changing technology.
His indecisive personality made an major mistake by keeping the company focused on wrong strategy. Edward Zander , took over Motorola from 2004 until 2008, ending a three generation reign of Galvin family. Edward Zander brought success back to Motorola by applying his great leadership and management skills. This article concluded four main mistakes that those failed leader made in the past, in addition, analysis the reasons why Zander success and pointed out four guidelines to follow. Executive summary Many companies fail because of the leader’s poor leadership.
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The purpose of this article is aimed at finding the reason that cause some leaders succeed and others fail by looking into Motorola’s leadership case. Motorola had dominated the industry until Nokia took over its place in 1996. The major decline of Motorola’s market share happened right before the sudden promotion of Christopher B. Galvin. Galvin’s wrong decision had kept the company focused on the wrong technology. His personality was slow, cautious, and hesitant. Even he had delegated responsibility toward his subordinates, however, lack of communication with his followers unclear the company’s vision.
He sat by while company was losing money and failed to deliver his promises to stakeholders. Galvin and other leaders’ mistakes are classified into four main parts: (1) not seeing current reality, (2) not discovering opportunity, (3)not explaining vision or convincing others to follow, and (4) fail when implementing change. While Motorola was struggling with its business in 2003. Edward Zander inspired the company with a new leadership style and new organizational culture after he became the new CEO.
Unlike Galvin, Zander faced the challenges squarely and had the discipline to confront the most brutal facts about the current reality. He grabbed the opportunity by developing unique products. Interacting closely with his clients and employees also explains the Zander’s new vision clearly. Under Zander, Motorola reported five consecutive quarters of increasing revenue. This article provided few guidelines that make a leader success. (1) understanding current reality, (2) identifying opportunities ,(3) explain the idea clearly, and (4) implementing change with excellent skills.
To conclude, by paying attention to those mistakes which made by failed leaders and following the guidelines presented above, people can understand the way to be a successful leader. Chapter I. Introduction Why do companies fail? You may find lots of reasons explaining their failures. However, there is the only one critical reason that matters the most: poor leadership. Those people who lead their company are among the brightest stars of business world. They graduated from Ivy League university, or world’s most selective and demanding schools. They are all unique, selected by thousand of candidates.
Yet after few years or even few months, their company crashed. Factories were shut down, employees were laid off, the stock price were plunged and hundreds of millions dollars were wasted. How is this possible? How can these leaders fail so fast? Leadership failures is the reason why a company failed; however, it could also be a opportunity for us to learn from their mistake and maybe we can prevent another business disaster in the future. This article discuss the reason why some leaders succeed and others fail by looking into Motorola’s leadership case.
Comparing two former leaders, Christopher B. Galvin and Edward Zander, found four things why Motorola’s leadership fail in 2000 (1) not seeing current reality, (2) not discovering opportunity, (3)not explaining vision or convincing others to follow and (4) fail when implementing change. Furthermore, the conclusion provided the ways to correct these mistakes that could be good leadership examples for future practices. Chapter II. Motorola’s Background (1928-2005) Motorola was founded by brothers Paul and Joseph Galvin in Chicago, Illinois as Galvin Manufacturing Corporation in 1928.
In 1930, The company introduced Automobile radio, using “Motorola” as the brand name which blended motor and victrola. By the end of 1940s, Motorola demonstrated taxi and fleet management radio system. Since then, the word has been used as a trademark. The company began making televisions in 1947 and over 1 million television sets were sold in that year. After Paul Galvin, former Motorola’s CEO, dead in 1959, Robert Galvin took over the company. In the mid-1960s, Motorola started to expand its international markets, establishing sales and manufacturing product all over the world.
By the 1970s, Motorola had introduced microprocessors and was solidifying its reputation as a world leader in technology. In September 1983, the world’s first commercial cellular device DynaTAC 8000X telephone, began its operation. Since then, Motorola had dominated the cell phone markets until Nokia took over its place in 1996. One of the reasons for Motorola’s steep decline was the sudden promotion of Christopher B. Galvin. Galvin was a senior executive vice president and assistant chief operating officer in 1990, president and chief operating officer in 1993 and finally became Motorola’s CEO in January 1997.
He made his first major mistake by keeping the company focused on wrong technology. Then Christopher also committed to keeping Iridium alive by backing up the system with $800 million in bonds. In June 1998, Motorola announced layoff of 20,000 employees due to the response of depressed profitability. While Motorola was struggling with its business in 2003. It announced the election of Edward Zander as the chief executive officer. Edward inspired the company with a new leadership style and new organizational culture. He also brought out several new products which bring Motorola back into rofits. Under Zander, Motorola reported five consecutive quarters of increasing revenue. According to Adam Lashinsky (2005), senior editor at Fortun, ” In BARELY 18 months at the helm of Motorola, Ed Zander has turned one of America’s sickliest big companies into one of the hottest “. Chapter III. The Problem Why Leaders Fail – Christopher B. Galvin (1) Not seeing current reality Sydney Finkelstein (2003) examined over 50 company’s failures and discussed that in most instances, the executive failed to see or accept what was actually happening. Motorola was one of these companies.
Galvin’s wrong decision of keeping the company focused on analog telephones, even though customers were switching to digital equipment; moreover, insisted the costly Iridium project which lost $2. 6 billion. These were all examples of not seeing the current reality. Paul B. Thornton (2011) pointed out some of the problem that limit a leader’s ability to see reality clearly: * Blind Spots : Leaders who are too arrogant that blind themselves to ideas that don’t align with their own. * Yes People: Leaders are surrounding by the followers who agree with them on everything. Fear: Leader are afraid to face the sensitive and difficult situations. * Bias: Leaders are affected by halo effect or have deep- seated stereotypes. * Limited Observations: Leaders made inaccurate conclusions due to the lack of data. (2) Not Discovering Opportunities ” Current reality is one thing; what is possible is something quite different. Leaders see opportunities while nonleaders only see the status quo”( Thornton, 2011). Christopher B. Galvin was an mysterious man. He was slow, cautious, and hesitant. His indecisiveness was criticized by his coworkers.
Some experts had suggested Galvin to sell Motorola’s semiconductor manufacturing division to prevent the further lose, but he refused. The result was Motorola laid off over 60,000 employees and closed four semiconductor and pager-manufacturing plants between 2000 and 2003. Galvin’s personality failed to motivated him searching for new opportunities; therefore, Motorola stepped on the road of failure. The following reasons explain why some leaders aren’t motivated to search for new opportunities (Thornton, 2011). * Leaders fail in to the sunk cost fallacy while they are making decision and don’t want to change. Leaders want to keep doing what made them successful. * Leaders are afraid they will not succeed. (3) Not explaining vision or convincing others to follow Every effective company has a mission statement, leaders must know their vision in order to lead followers to a right path. However, having a mission and a vision is one thing, being able to describe everything to your followers in a way that is clear, inspiring, and compelling is something else (Thornton, 2011). The problem began when Galvin became CEO and started delegating responsibility toward his subordinates.
Galvin rarely attended the meetings, and when he did visit conference room in suburban Chicago, he usually listened without saying much. Without the proper communication to his top managers, company’s vision was vague and the co-workers started to complain about him. ” People get pissed off at him, because they think he sometimes doesn’t act quickly”, says Patrick Canavan, special assistant to the CEO. Galvin himself maybe knew the exact target where his company should achieve, but he failed to deliver it to his followers due to the shortage of conveying passion and enthusiasm.
Employees didn’t have the motivator to motivate them therefore resulted an organizational culture that is conservative and unconcerned with customers. Few more reasons are listed below for some reason why leaders miss the mark when presenting their leadership messages (Thornton, 2011). * Leaders provide too much detail and bury the big idea. * Leaders don’t identify actionable steps for followers to take. * Leaders don’t have enough passion and enthusiasm in their delivery. (4) Fail when implementing change Galvin had struggled mightily in the chief executive’s seat since he was the CEO.
His hamlet-like indecisiveness and hands-off management style was the biggest problem that dragged down Motorola. He sat by while company’s costs were out of control and failed to deliver his promises to customers. The competitors defeated Motorola on everything from cell phones to the latest microprocessors. And when opportunities appeared to sell or close poor performance businesses, Galvin chose to overpass them. Even though he knew the change must be made but he failed when implementing change because not all change initiatives turn out exactly as planned.
Here are common problems why leaders fail when implement change (Thornton, 2011). * Leaders lack of clearness in terms of communicating who must change and in what way * Insufficient coaching or follow on support * Choosing a wrong project manager Chapter IV. How to be successful again – Edward Zander (1) Understanding current reality Jim Collins (2001) mentioned that great leaders must maintain unwavering faith that they can and will prevail in the end, regardless of the difficulties. And, at the same time have the discipline to confront the most brutal facts about the current reality.
They must have the ability to ask tough questions, face the challenges squarely and to analyze the real situation. When Edward Zander became Motorola’s CEO, he realized that the conservative mindset within the organizational culture was blocking Motorola from producing the right product and losing responsiveness to customers. He then decided to shift the company’s culture. He said,” Changing the culture is like coming into someone’s home and trying to change the way you do things. It is like changing your habits. The courage of facing the challenges and the ability to understand the reality made Zander a better leader than Galvin. (2) Identifying opportunities Great leaders should always look for opportunities. Opportunity doesn’t come to people, we have to find it. If leaders can’t find any opportunity for their company, it will lose the path to success. Zander grab the opportunity by focusing on customer needs. He noticed that there haven’t been many breakout products in the cell phone market, he believed that what customers need is a product that is fashion and light.
Therefore, he involved him-self in the design center, encouraged designer and engineers to develop unique products which were efficient to manufacture for the supply chain. Next, The Razr was introduced and became a runaway hit for Motorola in 2004. Motorola earned $1. 75 billion profit and claimed 19 percent of the global cell phone market. Zander found the opportunity and brought the company back to success again. (3) Explaining the ideas Leaders not only have to explain their ideas clearly, but also convince followers to take action.
Moreover, understanding followers’ need and fulfill it by providing both hygiene and motivator factors is the best way to motivate people. They should deliver the messages with conviction and enthusiasm. Leaders themselves must be fully committed to their vision, have no doubts, hesitation or question about it. Ed Zander was a charismatic person in the sense that he made it his mission and vision to closely interact with his clients and employees. He listened to the clients’ needs and wants and inspired employees to work together in fulfilling them.
He also listened to his followers and considered their opinions and feelings about the company and where it was heading. He satisfied his followers’ high- level needs by providing motivator factors. He was relentless in motivating his staffs into working harder and better, he had been effective in transforming the company after taking his post. (4) Implementing change with excellent skills Implementing change is not a easy job, it requires strong leadership and excellent management skills. On the leadership side, transformative leadership is the most effective leadership style while implement change.
To be a transformative leaders, one must have eagerness to accept responsibility. “Being eager to accept responsibility for your actions wins respect from your people, and it models the integrity, confidence and professionalism you expect from them” (Standard, S. 2012). Leaders are required to have interpersonal skill and to be generous and authentic. They always show consideration for their followers and be honest in their words and actions. Backing up followers talk with action, encouraging honest communication and accepting criticism smoothly.
Most important of all, leaders must always have humility. They have to set the example and be the first to model the changes being implemented. Set the bar high for themselves and put reasonable expectations toward their followers. On management side, first, great leaders have to plan a reachable and measurable goal. Then, organize a business structure and assign right men to the right positions that can make the company adjust change properly. Third, leaders must empower employees when leading change, therefore, they would understand the meaning and impact of the change.
Zander understand that changes need to be brought into this company. He shifted the company’s organizational culture by spruce up employees’ commitment level. Also, he hired the right man Stuart Reed as Vice President, who made Motorola’s supply chain more efficient. Moreover, the restructuring exercise brought by Zander made Motorola focus more on satisfied customers, and speed up the production process. The change he brought into Motorola not only make the company prosper again but also proved him as a better leader than Galvin. Chapter V. Conclusion
Companies fail for many reasons, but leaders should take the responsibility for the failure because they are the people who make the decision and direct their employees . Galvin’s made some critical mistakes that pull down Motorola from the leader of the industry. The mistakes he made can be classified into four main parts: (1) not seeing current reality, (2) not discovering opportunity, (3)not explaining vision or convincing others to follow, and (4) fail when implementing change. These mistakes could be a good lesson for other leaders to learn from the faults that make leadership fail.
To prevent leadership failure, here are some guidelines we can follow. First, great leaders must get a board understanding of the current situation. They need to know what are the challenges and potential threats facing the company. Secondly, leaders have to identifying opportunities, get out of the comfort zone and recognize that there is always something better to be discovered. Next, successful leaders must have the ability to create a vision that is so clear and compelling that all employees can understand and feel the value in the vision.
Finally, leaders ought to possess strong combination of both management and leadership skills while implementing change. All in all, as a leadership implication, it is instructive that we can pay attention to those mistakes which made by failed leaders; more importantly, understand the guidelines and follow it to become a successful leader References Cairns, T. D. (2011). Who’s up next? Most companies fail to plan for leadership succession. Employment Relations Today (Wiley), 38(2), 27-34. Collins, J. (2001). Good to great: why some companies make the leap… and others don’t. NewYork, NY: Harper Collins
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