Motorola’s makeover man: Sanjay Jha

Sanjay jaw motorolaWhen Sanjay K. Jha left Qualcomm for Motorola in 2008, he faced a daunting task. Save the once-proud Motorola handset business from the brink.

The Schaumberg, Ill.-based company faced a mountain of problems in mobile phones. It had too many software platforms. It was plagued with product delays, and it was on the verge of missing the transition to smart phones.

The past two years have been difficult, with thousands of layoffs and staggering losses as Jha pushed ahead with his strategy. Although there has been some success in gaining smart-phone market share, Motorola’s handset business is not profitable. So Jha’s turnaround effort is very much a work in progress.

The plan boils down to emphasizing smart phones, and betting big on Google’s Android operating system as the platform that will help the company stand out in the fiercely competitive mobile phone market.

Jha, who still lives in San Diego but spends his workweek at Motorola’s suburban Chicago headquarters, thinks the handset division can turn a profit by year end

Jha worked at San Diego-based Qualcomm for 14 years. When he left, he was president of the wireless giant’s chip set division and chief operating officer.

Today, he is co-chief executive of Motorola, overseeing its mobile phone and set-top box businesses. In 2011, Motorola plans to spin off Jha’s divisions into a separate company.

In an interview this month, Jha discussed a host of topics, ranging from why he left Qualcomm to what he thinks about relocating Motorola’s headquarters to San Diego.

QUESTION: What was it that attracted you to leave Qualcomm for Motorola?

ANSWER: I joined Qualcomm when I was a senior engineer in 1994, and I made my way up the ranks and became president of QCT (Qualcomm CDMA Technologies) and chief operating officer of Qualcomm. Really, the majority of time I spent focused on running QCT, which is the chip set division there. I was quite proud of the success we had in growing that business.

There came a time where I had to decide whether to commit four or five years — because I saw there was a piece of work that needed to get done that required a commitment — or to look for other challenges. About the same time frame, I was contacted to consider the Motorola opportunity.

Of course, I understood that Motorola was a challenging assignment. But I felt that I wanted to do a piece of work that I can call my own, and be proud of — engaging with a piece of work that was meaty, shall we say.

QUESTION: What needed to be done at Qualcomm that required a commitment?

ANSWER: My view is that there is a migration going on in the industry from phones being modem-centric to much more application-centric. I’m not sure that it was accurate; I never got the chance to go engage with it. My view was that requires a fairly substantial transformation of the work I was doing at QCT.

My Ph.D. was in digital signal processing, which in some ways traverses both of these domains. But the second domain becomes much more application-centric, much more consumer experience-centric as opposed to how many bits and bytes you can put over a certain bandwidth of spectrum.

QUESTION: Some have suggested that you were looking because you didn’t get the CEO job at Qualcomm when Irwin Jacobs retired. Can you comment on that?

ANSWER: I think Irwin retired three and a half years before I left. Look, I had a clear understanding that Paul (Jacobs) was CEO. How to best say it, I felt that Paul was doing a wonderful job. Certainly the opportunity for being CEO at Qualcomm for me would be farther out, and that did play a role in my thinking. But I think the broader question was what type of work could I do that would stretch me to the next level.

QUESTION: When you looked at the Motorola business when you arrived, what needed to be done?

ANSWER: I had come to the view that smart phones were going to be very important. The first thing we did was rationalize the platforms, reduce from, I don’t know, six software platforms to one, and choose that platform to be a smart-phone-centric platform, a mobile-Internet-centric platform.

There was a big transition going on in the industry (to smart phones), and I think it was clear that Motorola was missing that transition, and my job was to make that transition as fast as I could. That was job number one when I arrived. We were working on too many platforms and were not focused on the right market trends.

QUESTION: You went with Google’s Android operating system. What made you pick Android?

ANSWER: There were a few things. One was while I was at Qualcomm, I had actually engaged with Googleand was working with them, and I had an intimate understanding of what they were trying to do.

I felt as we started to get into smart phones that the mobile Internet was going to be more important than anything else. And I felt Google had written that platform efficiently, and they had services for the mobile Internet which were differentiated.

QUESTION: The company is expected to split in 2011. Is it possible the mobile division might end up in San Diego?

ANSWER: At the moment we are very busy executing our 2010 plan, so I don’t know if that is the highest priority on my list. But at some point, I think we will go and re-evaluate as to where our headquarters will be.

There is an argument that it should be on either of the two coasts. It depends on how much business we do in China. That will have an influence. It will depend on where we are able to find people who can drive some new initiatives for us.

I would say that Libertyville (near Chicago) will continue to be a very big facility for us. In San Diego, we already have a very big facility. As you know, I have the mobile business as well as the set-top box business. The set-top box business has very deep roots in San Diego. I think my links to San Diego, if anything, deepened as a result of having that business.

But I don’t know that we have made that decision. Is San Diego a possibility? When we get engaged with it, we’ll definitely consider San Diego. My family, you know, still lives there. I have a special place for San Diego in heart.

QUESTION: Operating losses have dropped for the business. Is that attributable to cost cutting, or is it the result of market traction on the smart phone side?

ANSWER: Probably both. When I was at Qualcomm, every year I would go to investors and say, you know, I have to invest more in this business. And I actually did increase our investment in R&D quite dramatically, consistent with the growth we were seeing in our market.

Here the situation was different. A couple of months after I arrived, we had the October 2008 phenomenon — probably the largest dislocation in the financial markets that I have ever seen. And combined with the financial position of the business here, as well as the dislocation, we took $1.5 billion of cost out of here. We laid off a large number of people, which is always painful. I think that right-sized the business for us.

But really the thing that is most exciting is the growth in the smart phone business, which is much better revenue for us than the feature phone business in the sense that there are greater gross margins and there is greater growth associated with that.

QUESTION: What is the toughest decision you had to make since joining Motorola?

ANSWER: Probably letting go of such a large number of people. It’s just not ever pleasant or easily palatable.

QUESTION: What is the best decision you’ve made?

ANSWER: Probably to focus on smart phones. In the beginning of 2009, we probably had 10 or 12 products that were feature phone products. We looked at the financial profile and we said, look, we can put 30 or 40 percent of our R&D on them. The return is there, but it’s not a long-term return. If we cancel it, we can get a head start on putting those people (to work) on leading in smart phones.

I’m very proud of what the team here has done. We launched our first smart phone in October, and we’ve already launched eight smart phones in the marketplace, including three in China.

The reason we were able to do that is we canceled a number of products. At that time, it was very painful. If you look at the numbers, I think we lost $385 million on a pro forma basis in the first quarter of 2009, which was probably the darkest night in our recovery. Once the decisions were made, we began to execute, and I think things have begun to turn around for us.

Mike Freeman: (760) 476-8209;

Ref : The San Diago union Tribune


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