FY028 - Inquiry Based Learning: Analyzing Motorola's Business Failure

This case study employs inquiry based learning to investigate the failure of Motorola, a once-dominant American multinational telecommunications company. The analysis explores the company's history, identifying key areas of failure such as poor management, neglecting innovation, and missing the shift to 3G technology. It utilizes SWOT analysis and Porter's Five Forces framework to assess Motorola's competitive environment and strategic missteps. The report concludes with recommendations that Motorola could have implemented to avoid its decline, emphasizing the importance of innovation, efficient supply chain management, and responsiveness to market changes. The study highlights the critical role of strategic decision-making and adaptability in maintaining a competitive edge in the rapidly evolving telecommunications industry.

FY028 Inquiry Based
Learning

EXECUTIVE SUMMARY
Inquiry based learning is a form of learning that involves answering to the questions that
arises. Motorola, an American Origin Multinational company was experiencing a complete
success then certain events took place in the macro environment of the company leading to its
fall. The report covers this company in telecommunication sector that is Motorola and studies its
background and reasons for its failure. It covers varied reasons that like poor management,
ignorance to innovation, etc. that resulted in failing of company. SWOT analysis is a
management technique that is used by companies for strategically managing the business through
strategic plans. Porters’ five forces is a framework that is used by businesses for the purpose of
analysing the competition that exits in the operating environment of industry. The report covers
the swot analysis framework and porter’s five forces of the company. The recommendations that
the company should considered in the past and can imply now are included in the report.
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Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Company History Background....................................................................................................3
Identification of areas of failure..................................................................................................4
Analysis of current trends and competition at the time company failed.....................................5
Recommendations........................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10
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INTRODUCTION
An active form of learning that starts by asking questions and implying greater
importance to situations or problems is known as inquiry based learning (Khalaf and Mohammed
Zin, 2018). Motorola was an American originated MNC in telecommunications sector. The
company suffered huge loss that resulted in splitting up of company into two separate companies
(Wilson, 2021). The current report will discuss the background of company covering its history.
There were certain areas that led to the failure of the company like poor management, change in
customer behaviour, ignorance of competitors. Such Areas whose malfunction led into creation
of problems for the company will be highlighted. Further in the report analysis of current trends
of that time will be done with the application of swot and porter’s five forces. Lastly the
recommendations on the basis of the report will be included and entire report will also be
concluded.
MAIN BODY
Company History Background
Motorola initially an American public company was founded in the year 1928 by Paul
Galvin. In the name of Galvin Manufacturing Corporation, it was started in Chicago. In 1928 in
an auction of a bankrupt company Stewart Battery at Harrison Street, Chicago, two brothers
named Joseph E. & Paul V. Galvin were present (Wilson, 2021). They bought the battery –
eliminator plan along with equipment of manufacturing it for an amount of $750.
In a small rented shop of a building with initial working capital of $565 and only five
workers Galvin Manufacturing Corporation started up. Battery – eliminators were the starting
product of this small establishment. Such devices enabled the radios to operate by using home
electricity. The advancements in the technology related to radio can with the time and the
concept of such eliminators outdated (Li, 2021). Then the founder noticed that some technicians
are working for providing radio devices into automobiles. So he asked his staff to work upon it
and produce a device that is economic and can be installed in majority of vehicles. In the June of
1930 the efforts of team members succeeded.
A demonstration of working radio model to a manufacturing firm owners of New Jersey
relived the company by its orders. With the new product of company’s success, the founders
wanted to give a name to the brand as the products were based on motor and most companies of
that time ended their name with “ola”, the brand name was given ‘Motorola’. The first product of
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the brand was sold by the company in the June of year 1930 (Hakim, Kalijaga and Indrawati).
Increasing popularity of the name insisted the Galvin to change the name Galvin Manufacturing
corporation as Motorola. There were many products of the company that were related to radio
technology. Some examples are: radio battery eliminators, walkie – talkie, defence electronic,
mobile phone, etc.
It was in the January of year 2011 when the company undergone non – operational. From
the year 2007 to 2009 a total of $4.3 billion loss was experienced by the company and became
the reason for separation of company into two independent companies namely, Motorola
Solutions and Motorola Mobility on 4th of January year 2011. The undeviating beneficiary of the
company, Motorola Inc. was considered to be its Motorola Solutions firm. in the year 2014
Lenovo developed Motorola Mobility (Agustiandi, Madelan and Saluy, 2021). Various wireless
devices were designed and sold by the business. Signal amplifiers & base stations are some
examples. Products for broadcast and home networks by the organization were video recorders
that were digital and set – top boxes, high – definition TVs etc.
The main customers to which the company used to get it orders are for broadband
systems and wireless voice. Dimetra & Astro are other two products used for communication to
ensure public safety for which company had its sales. Motorola Solution includes all the
businesses of the firm leaving cables for modems and the set- top boxes. For the value of
US$2.35 billion the Motorola Home was sold to Arris Group by google in the year 2012.
Identification of areas of failure
 Missing the movement to 3G - There were various reasons why the company
started not to perform well and eventually failed. When the market of US was
shifting towards 3G with movement in respect to this the company missed the
chance of bringing this technology (10 reasons why Motorola failed, 2022).
Customers of the company were resistant to shift to 3G that is why the company
took decision of not shifting to the network. This become a major reason behind
firm’s being left out in the competitive world (Hetrick, McDonald and Park,
2021).
 Static Behaviour - The business environment is full of things that cannot be static
ever. Companies need to run with this level of competition the market and the
ever evolving nature or scenarios but the company never coped up with the race
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of the competitive environment. It always has its own pace of working which
resembles more with the firms that operates in monopolistic markets.
 Getting Out of the Business at Wrong Time – There was a time when company
had lot of spectrum that it traded in exchange of equity. Hence it started with sales
at zero every year and missed the valuable opportunities to by Nokia and
QUALCOMM.
 Company Ran Out of Time – Poor management by the managers of the
company indulged the business into the problem of losing valuable time that
could be used in taking effective decisions in counter to its competitors move.
 Lack of Innovation – The company stopped bring new features into its devices.
While the competitors in the market kept on innovating and competing,
increasingly satisfying consumer needs. This made one of the main reason behind
the failure.
 Company Failed in Executing What It Promised – The customers of the
company had bad relations with the company because it failed to provide the
quality in its services that it promised.
 Absence of Sense of Urgency – when the others in the industry were prompt with
their responses to the changes in the market conditions Motorola failed to align its
operations with such changes.
Analysis of current trends and competition at the time company failed
Current Trends and Competition at that Time
In the telecom industry sector for mobile phones was in a lead during the year 2011.
There was a sudden increase in the demand for mobile broad bands. The social networking was
at the peak of its growth, Facebook was gaining popularity that a very high pace followed by
YouTube, Flickr & Wikipedia. Various new applications & services were also seen being
flooded in the market. The competition in telecommunication and ICT markets was fostering.
More and more companies were entering into the market because of increasing level of market
attractiveness. 81 percent of the countries were experience competitive International gateways.
3G markets was having high competition AT&T, Verizon, Comcost Corporation were market
leaders of that time.
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SWOT Analysis
Strengths Weaknesses
Product Portfolio – the company’s product
portfolio is diverse. It includes infrastructure,
accessories, services, software & devices of
communication.
Global Presence – there are 180 countries in
which the company is present.
Relationship with government – Company is
having good relations with federal governing
authority of US (SWOT analysis of Motorola
Inc., 2022).
Focus on R & D and long term contracts – The
focus of company on these factors is its
strength.
3G - Failure in accommodating with 3G
network is the biggest weakness of the
company.
Midwest Values – High level of focus on this
initiated business in making certain big
mistakes.
Exit – Another weakness is that the company
overlooked the purchase decisions regarding
Qualcomm & Noki. At a very wrong time it
left the right business.
Attitude – Slow paced attitude of the company
is the another weakness.
Opportunities Threats
Demand – The biggest opportunity for the
company is the growing demand of the market
for phone with more features.
Increasing users – The number of people using
smartphones is increasing rapidly in
developing countries, posing a great
opportunity to the company.
Competition – The entry barriers being limited
in the country increases the threat of
competition for the company (Benzaghta and
et.al., 2021).
Health Concerns – Increase in the level of
concerns for the people related vibrations
causing deadly diseases like cancer and
tumours is threat to the company.
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Porter’s Five Forces
Threat of New Entrants – The barriers to entry in the industry are minimal making it
easier for new firms to enter in market. New entrants bring innovation in the market increasing
the level of competition and insisting the company to sell its products and services at lower
prices making it difficult to earn high margins.
Bargaining Power of Suppliers – Just like every other firm in telecommunication industry
Motorola too purchase its raw materials from many suppliers. Suppliers providing key materials
have that power of reducing the margins of the company by charging high prices for the raw
materials (Swot And Porters Five Force Model Of Motorola Management Essay, 2022). There is
direct impact of negotiation by suppliers over the profitability of the business. Having options for
raw materials is advisory to remain profitable.
Bargaining Power of Buyers – The industry in which company operates is the one where
customers can be very demanding. They prefer to have minimum prices possible and experience
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the best of the features. In long run this ruins the profit earning capacity of company. Hence it
can be said that the bargaining power of customers is high.
Threat from Substitute Products – The profitability of company hurts with increasing
availability of substitutes product in the market. For instance, products or innovation like google
drive destroys the market for hardware devices (Anastasiu, Gavriş and Maier, 2020). Substitute
are any products that can be used instead to what the firm offers hence, they impose great threat
to the company.
Rivalry Among Existing Firms – In a situation of high rivalry existing among the various
companies operating in industry it firm is compelled to sell products at low prices to remain
functioning in the market. Market in which the firm operates is highly competitive that destroys
profitability in long run.
Recommendations
It is recommended to the company to bring innovations more often. Economies to scale
can be enjoyed by producing in larger quantities. It is further recommended to spend more on
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research and development. Building an efficient chain of supply will ensure the profitability of
the company. Also experimentations with the different materials can benefit in the form of
innovations and reducing dependency over few suppliers. Paying more attention to the services
that are offered can help in countering the threat of similar products. Making efforts to increase
the switching cost on the part of customers and better understanding of their core needs is
suggested to company.
CONCLUSION
On the basis of the above report the meaning inquiry based learning is clear that it is a
type of active learning. The report is based on Motorola Inc., a public firm in
telecommunications industry. Historical background of the company has been discussed in the
report. Issues that it faced and resulted in the failure of company has been covered. Models of
analysis like Swot and porters’ five forces framework has been applied. Several
recommendations to the company has also been included in this report.
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REFERENCES
Books and Journals
Agustiandi, D., Madelan, S. and Saluy, A. B., 2021. Quality Control Analysis Using Six Sigma
Method to Reduce Post Pin Isolator Riject in Natural Drying Pt Xyz. International
Journal of Innovative Science and Research Technology. 6(1). pp.1417-1426.
Anastasiu, L., Gavriş, O. and Maier, D., 2020. Is human capital ready for change? A strategic
approach adapting Porter’s five forces to human resources. Sustainability. 12(6). p.2300.
Benzaghta, M. A. and et.al., 2021. SWOT analysis applications: An integrative literature
review. Journal of Global Business Insights. 6(1). pp.55-73.
Hakim, S. N., Kalijaga, A. and Indrawati, S., Service Performance Improvement During
Pandemic COVID 19 Using Integrated SERVQUAL and Six Sigma: Telecommunication
and Information Industry Case Application. Journal of Industrial Engineering and Halal
Industries. 1(2). pp.94-101.
Hetrick, R., McDonald, B. and Park, J., 2021. UNDERSTANDING LEAN SIX SIGMA TOOLS
WITH A SERIES OF CASE STUDIES. In Proceedings of the International Annual
Conference of the American Society for Engineering Management. (pp. 1-7). American
Society for Engineering Management (ASEM).
Li, L., 2021, August. Customer Value Measurement Under the Background of E-commerce.
In 1st International Symposium on Innovative Management and Economics (ISIME
2021) (pp. 462-467). Atlantis Press.
Wilson, P. A., 2021. 6. From Motorola to Mextron: Case Studies of Individual Business
Strategies. In Exports and Local Development (pp. 96-119). University of Texas Press.
Khalaf, B. K. and Mohammed Zin, Z. B., 2018. Traditional and Inquiry-Based Learning
Pedagogy: A Systematic Critical Review. International Journal of Instruction. 11(4).
pp.545-564.
Wilson, P. A., 2021. 6. From Motorola to Mextron: Case Studies of Individual Business
Strategies. In Exports and Local Development (pp. 96-119). University of Texas Press.
Online
10 reasons why Motorola failed. 2022 [Online]. Available through: <
https://www.networkworld.com/article/2277903/10-reasons-why-motorola-failed.html>
SWOT analysis of Motorola Inc. 2022. [Online]. Available through: <
https://www.marketing91.com/swot-analysis-motorola-inc/>
Swot And Porters Five Force Model Of Motorola Management Essay. 2022. [Online]. Available
through: <https://www.ukessays.com/essays/management/swot-and-porters-five-force-
model-of-motorola-management-essay.php>
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