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    A CEO's Perspective - Making Innovation Work by Galvin 2010

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    International Journal of Innovation Science
    Praveen Gupta, the Editor of International Journal of Innovation Science, had an opportunity to interview Chris Galvin for his views on innovation at his new company Harrison Street Capital in Chicago, IL. We would like to thank Mr. Galvin and his staff for the interview in support of the journal and making innovation more pervasive, predictable, and profitable. PG:

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    A CEO's Perspective - Making Innovation Work by Galvin 2010

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    International Journal of Innovation Science
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    Praveen Gupta, the Editor of International Journal of Innovation Science, had an opportunity to interview Chris Galvin for his views on innovation at his new company Harrison Street Capital in Chicago, IL. We would like to thank Mr. Galvin and his staff for the interview in support of the journal and making innovation more pervasive, predictable, and profitable. PG:

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    A CEO’s Perspective - Making Innovation Work by Galvin 2010

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    Praveen Gupta, the Editor of International Journal of Innovation Science, had an opportunity to interview Chris Galvin for his views on innovation at his new company Harrison Street Capital in Chicago, IL. We would like to thank Mr. Galvin and his staff for the interview in support of the journal and making innovation more pervasive, predictable, and profitable. PG:

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    214 views2 pages

    A CEO's Perspective - Making Innovation Work by Galvin 2010

    Uploaded by

    International Journal of Innovation Science
    Praveen Gupta, the Editor of International Journal of Innovation Science, had an opportunity to interview Chris Galvin for his views on innovation at his new company Harrison Street Capital in Chicago, IL. We would like to thank Mr. Galvin and his staff for the interview in support of the journal and making innovation more pervasive, predictable, and profitable. PG:

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
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    47

    A CEO’s Perspective - Making Innovation Work


    Chris Galvin
    Co-Founder and Chariman, Harrison Street, Former Chairman and CEO, Motorola, Inc.

    Praveen Gupta, the Editor of International Journal of Innovation Science, had an opportunity to
    interview Chris Galvin for his views on innovation at his new company Harrison Street Capital in
    Chicago, IL. We would like to thank Mr. Galvin and his staff for the interview in support of the journal
    and making innovation more pervasive, predictable, and profitable.

    PG: How does it feel to give up a jewel like Motorola, an innovative company, and how much do you
    miss technology aspects of your job?
    CG: Allow me to answer in some detail, connecting the dots between the importance of high
    innovation, or lack thereof, and financial results.
    During 2001-2003, it wasn’t easy to lead Motorola's painful restructuring worldwide, but
    simultaneously, it was a delight for me to lead innovation in my role as CEO, partnering closely
    with a spectacularly imaginative team of Motorola innovators then. We created the vast array of
    Motorola’s new products that sold so well and gained market share in 2004-2006, including the
    RAZR, which was completed in 2003. Global technology buyers purchase greater quantities and
    pay much higher prices for breakthrough innovation in new products. The RAZR and the GSM
    V series phones became two of the top five mobile phone sellers ever at $150-$200 or higher
    price point. High innovation pays off. Just like Apple Inc. produces terrific financial results today,
    Motorola, back then, doubled Mobile Devices sales from $11 billion to $28 billion, gained 8%
    global market share to 22%, and more than quintupled earnings, from $500 million to $2.7 billion
    from 2003 to 2006.
    The undercurrent of your question is… I did not "give up" Motorola, Motorola’s Board of
    Directors chose proactively to extinguish the Galvin CEO leadership of innovation at Motorola
    after 75 years.
    What resulted?
    Each product’s lifecycle is approximately three years in mobile phones, so products created
    during the 2001-2003 timeframe would naturally begin to run out of gas by late 2006.
    Unfortunately the new senior leadership team failed in 2004-2006 to create the pipeline of
    exciting products to sell in 2007-2009. Motorola’s financial results declined accordingly.
    Motorola’s Mobile Devices has now declined to a $7 billion business in 2009, shrunk to 3.7%
    global market share and the business has lost billions of dollars since 2007.
    Regrettably as of the end of 2009, Motorola Inc. has now shrunk to half its $43B size in 2006,
    and suffered profitless performance over the last three consecutive years. Failure to innovate has
    painful consequences in financial performance, negatively impacting shareholders and US
    competitiveness.
    Today Motorola Inc.'s share price is 20%-25% below what it was when the Board announced I
    should no longer lead Motorola’s future innovation. It’s 70% below the company's share price at
    the peak of the RAZR innovation boom.
    The years 2000-2009 were the first decade in 80 years when Motorola didn’t create a new
    industry unlike the creation of the Public Safety Communications Industry (1930’s), the Cellular
    Telephony Industry (1970-1980’s), and the Cable Broadband Industry (1990’s).
    Now Motorola’s Board of Directors has decided to split the company, taking away the advantages
    of global scale, diversified technology business portfolio and multi-faceted and broad technology
    core competences.

    Volume 1 · Number 4 · 2009


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