Get It Right, Motorola

I don't quite know why Motorola (NYSE: MOT  ) has such a hard time generating cash these days. Judging from recent reports from Nokia (NYSE: NOK  ) , Research In Motion (Nasdaq: RIMM  ) , and Sony Ericsson (NYSE: SNE  ) (Nasdaq: ERIC  ) , the average Joe (or Jane) is getting over that whole negative 'tude against high-end mobile gadgets. Apple's (Nasdaq: AAPL  ) iPhone is doing its best to fan the flames of consumers' smartphone ardor as well.

Yet Motorola turned in a quarter of losses on weak demand for its phones. The RAZR was a bona fide hit in its heyday, but that was a couple of years ago -- eons in the fast-moving handset market, or any other high-tech enterprise. The once-hot gadget is now a has-been throwaway in the deep-discount racks of your local Best Buy (NYSE: BBY  ) .

Model after model tried and failed to be the sequel Motorola needed, including the ROKR and SLVR. The latest hopefuls are the RAZR2 and MOTO Z8, and we'll see whether they do any better. But the string of failures is disconcerting; this company really should be doing better.

I'm not saying that CEO Ed Zander needs to go, as many others already have said. But there's something flawed about a product line that wins industry awards for customer satisfaction, yet fails to live up to its revenue potential. Maybe the marketing department is the real culprit, or the sales teams that wrangle shelf placement and unit incentives with retailers and networks. It's hard to tell from where I sit.

The management team itself should have plenty of transparency there, though. Wherever the root of the problem lies, it is time for a firm correction. Job cuts are never any fun, but when entire departments fail to perform, the folks high in the ranks must make some tough decisions.

Further Foolishness on line one:

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Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like. Foolish disclosure is always stylish, always smart, and always on fire sale.


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