Greg Brown is content to do a few things, and do them well.
That’s why the CEO of Schaumburg-based Motorola Solutions helped engineer the January 2011 spinoff of its sister, cellphone division Motorola Mobility, the consumer-facing division that was sold to Google for $12.5 billion in 2012.
Since the split, Brown, 53, has tried to shore up Solutions’ core market: business-to-business communications equipment such as police radios and heavy duty vehicle-mounted computers. But government contracts constitute two-thirds of its revenue, and public-sector coffers haven’t exactly been overflowing since the recession. To reroute the limping giant, he’s made deep cuts. Today, Motorola has 22,000 employees — 40,000 fewer than when Brown took over as CEO in 2008, and Solutions’ wireless networks unit was sold to Nokia Siemens Networks for $1 billion in 2011. In August, CFO Ed Fitzpatrick was let go after the company revised its revenue forecast downward twice in three months.
Amid such challenges, Brown doesn’t have room for high-flying rhetoric. Instead, he traffics in realism. The days when Motorola could throw resources at every idea are long past. The firm must now choose its battles carefully. “You decide how effective you can be in certain segments — you look at the company’s core competencies: what we do well, what we don’t do well,” he says. “Start with a very realistic assessment of the business and where we are. Not an aspirational perspective of where we want to be.”
Grid: In the last few years you’ve developed a reputation for cutting out areas where Motorola can’t be the best. How do you decide where you can come out on top?
Greg Brown: It starts with being starkly blunt and candid about our abilities and what we’re good at and not good at. Once we recognize that and chalk the field appropriately, we then map our priorities with clarity. With a fixed amount of capital and an intensively competitive environment, you’ve got to pick your marks. I’ve always believed we can do more if we can do less.
Even though Motorola invented the cellphone in the ’70s, and that industry is a several hundred billion dollar industry, the dynamics of competition changed along the way. All of the dynamics of competition changed. Phones went from voice-centric to Web-centric, from hardware form-factor oriented to software user interface-oriented. Motorola lost its way and lost its market share. The elements that made Motorola successful and brought it to the dance had completely changed to a different set of competitive elements that I thought didn’t serve the future of the firm well. At the end of the day, great companies continually do a blunt self-assessment of where you can win and where you can’t. With that comes the obligation to take action on what you see and what you know.
Grid: How do you decide when to take action?
GB: I’m pretty much always thinking about it. I’m thinking about where we can get stronger, where we can win more, where we can provide more differentiation, continually challenging why customers continue to buy from us, asking where we’re not performing. Is it competitive, is it capability, is it cultural, is it technological? You don’t want to be obsessive compulsive, but you do want to have an ongoing fluid assessment of the firm and of yourself to make sure you’re vigilant and doing the best you can do.
Grid: A lot of your revenue comes from the government. How do you grow in a time of austerity?
GB: You continually enforce the value proposition of why investing in mission-critical communications takes precedent over other expenditure alternatives. So money can be tight — and it is — but it’s incumbent upon us to reinforce why what we do should remain a top priority.
Grid: And how do you do that?
GB: We highlight where we’ve done it successfully before. In public safety, we point to Hurricane Sandy, the Oklahoma tornadoes, the Boston marathon bombings, to continually enforce the always-on-and-always-up nature of our systems, and the critical component that there is no substitute for real-time communications in emergency disasters. You must be able to communicate. We continually invest in R&D to ensure our products and services are the best in the world.
Grid: You’ve talked about how Illinois is struggling for business and mentioned other states that have called you up, offering to help you relocate. Is that ever tempting?
GB: It’s tempting from time to time, but being in and adjacent to the city of Chicago, in and around such leading universities, maximizes the assets and investments we’ve made over decades — those are key components and attractions for us to stay here. The flipside is the lack of courage by the Illinois politicians to address pension reform. The lack of courage to take action to make Illinois much more competitive. Capital is mobile. People are mobile. Go look at Detroit. Go look at other areas [that lack] political leadership, private investment and courage. It can destroy a city or a state. It takes years to get back if you’re able to at all. Even in California, they now have a budget surplus. The way they got there was painful. At least Jerry Brown had the will to say ‘no more.’ There may be a day when there’s a tipping point in Illinois — I remain optimistic that common sense will prevail. But the 24-second shot clock is winding down.
Grid: What keeps you up at night?
GB: I always think my job as CEO is to develop people and deploy capital. Developing people speaks to the leadership and culture and tone of the firm. The deployment of capital provides the strategic framework and road map for the company. Think of it as strategy and culture. I don’t worry at all about our strategy. Occasionally what keeps me up at night is whether we all have the sustainable and burning discontent with the status quo. Are we all changing as fast as we need to? Are we all being decisive and crisp in what we need to do? Large organizations struggle with bureaucracy, process, pace, and I often think of personalizing it with what else I should be doing or can be doing more effectively, to propel this company further with greater urgency and impact — that’s what I think about.
Grid: What makes for a successful CEO?
Continuous learning. They learn from their mistakes, and they gain wisdom from scar tissue. Judgment. People lead differently. Some are quiet, some are loud. Some are wordy, some are very selective. It’s not a style thing, it’s a substance thing.
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