A week ago Motorola missed analyst’s expectations for third quarter revenues and profits, and the stock fell (see story here). Given that the stock price has had a great run the last year, investors might well be tempted to sell the stock, fearing a stumble in the long run of growth.
While that was page one news on the business section, on the same day Motorola made an even more interesting announcement that made page 2. They hired a new Chief Marketing Officer (see full article here). And the person they selected, Casey Keller from Heinz, should put bullishness back into investors.
While at Heinz, 45 year old Keller was responsible for launching the EZ Squirt line of ketchup products, which came out in green, purple and even blue. Needless to say, a new bottle shape, and funny colors, does not drive me to buy more ketchup. But what these launches demonstrate is that Mr. Keller knows how to get permission and funding to try new things – even in a company as staunchly boring as Heinz. He has demonstrated he knows how to get White Space created, and he knows how to manage it for innovation. Innovation that drove brand protection, price support and incremental revenues in an extremely "mature" product line.
Motorola actually saw its 2006 revenues grow 17% versus 2005 in the third quarter, as cell phone market share has risen from 14% to 22% since 2004. That is not a growth stall. But it missed estimates. What does the company need to do now? Why continue the development and implementation of more White Space – leading to more innovation – just as Ed Zander has done since taking the helm of the company.
Looking around Motorola, there aren’t many people with the skills for creating and managing White Space. That was not the winning personal Success Formula before Mr. Zander. So to find a leader that understood how to identify Challenges, and then create and manage White Space Mr. Zander and the Board had to go outside. There they found someone with the right skills – White Space management skills – that should be able to produce even more robust results in the dynamic Motorola of today.
Investors should think twice before jumping out of Motorola. If he’s as good as his past, Mr. Keller just might help Motorola keep their double digit revenue growth going.
Well here we go again, If you look at the choice they made for the Chief Marketing Officer, you have a young innovated guy who seems to look at things differently, the so called think out of the box type of guy. When you mention executive to most people they think older person who has a very conservative outlook and how things should be done. Then you hire a 45 executive who is not afraid to think out of the box and try new ideas. The Heinz ketchup bottle idea I think was good, although it may not have been the right fit for this product, but he was willing to take a chance at going out a limb to do something out of the ordinary. As a consumer I am more willing to look at something that is creative then something that has been done to death. I say hold your stock a bit and see what the new guy can do.
45 years old personality is a good choice. Well, I believe that companies are getting much lazier then years ago. There are less and less innovations, and what worries me the most, is that many companies cut costs wherever they can, and in results innovations is being destroyed in new employees or experienced in industry individuals. Of course corporate culture is very important as well. If CEO has vision, good strategy and want the employees to be part of the game, than there is a care. If there is a care there is a healthy environment to create and innovate. More or less, I don’t think companies are really looking at it these days. I think they are lost in the game of globalization. They don’t know anymore which values are really important and how to be competitive in the world and how to create competitive advantage. They don’t know how to create “white space” as you mention very often Adam, and this is a problem.
I believe corporate world need a shoot of young blood. The old conservative top managements lost their edges. We need to have creation in young individuals and somebody has to give the tools. Our industry cannot rely on reverse engineering practices all the time. Let’s take the step forward. Let’s get out from the “box” and look into the future. Why we always have to follow somebody. Let be followed by others.
Keller created green ketchup. Was that a success?? Maybe, maybe not. I never purchased one, but the guy came up with something what other people in Heinz would never even dare to do. He had vision, and found a way to persuade the management. Motorola is large and got itself into the game of globalization/cutting to costs. I think it is time to wake up and start thinking about White Space. The power is in people so give them the tools and let them be the future of the company before is too late.