Motorola revamps structure to help customers

(Telephony) With industry analysts predicting a tough year ahead, Motorola has replaced its communications enterprise (CE) unit with three standalone divisions in an effort to address customer needs better and more quickly.

Three executives were promoted to head the new units. Mike S. Zafirovski is president of the personal communications sector (PCS), Edward D. Breen is president of the networks sector, and Joseph M. Guglielmi is president of the global customer solutions operations.

The restructuring is designed to improve profitability, customer satisfaction, and Motorola’s ability to react and anticipate changing market conditions. The company formed the CE in June 1998 as a single contact point for its customers and to improve internal communications.

“At the time, Motorola was difficult to deal with because customers had to deal with different entities,” said a company spokesperson. “The flip side of that problem was that the businesses within Motorola weren’t talking to each other as much as they should be. The CE was designed to change that culture.”

With the internal communications improved, customer feedback indicated Motorola should provide more targeted contact points for its different types of customers, which the new structure is designed to do.

Now the company needs to convince its customers, the industry and Wall Street that it is moving in the right direction after a difficult 2000, according to analyst Paul Dittner of Dataquest.

“Their consumer products division has been an ongoing struggle for them since the transition to digital,” he said. “The long and the short of it is that Nokia has been cleaning Motorola’s and Ericsson’s clocks for some time now.

“At the beginning of 2000, Motorola made some very aggressive goals in terms of profit margin for their products that they did not meet. When you make statements as strongly as they did, missing those objectives was going to cause some significant changes to happen. That’s what this is about.”

Dittner added that while Motorola’s revamping appears to be a step in the right direction, this year may be tougher for the company than last year.

“Nokia had opened the door for them with the delay of some their products,” he explained. “Now Nokia has introduced some interesting new products that will make this a more difficult challenge for Motorola moving forward.”