Galvin, Christopher B. 1950–
Christopher B. Galvin
Former chief executive officer and chairman of the board, Motorola
Education: Northwestern University, BS, 1973; J. L. Kellogg School of Management of Northwestern University, MBA, 1977.
Family: Son of Robert Galvin (chairman of the board, Motorola); married Cynthia (maiden name unknown), 1979; children: two.
Career: Motorola, 1967–1973, part-time salesperson, two-way radio division; 1973–1984, salesperson, radio division; 1984–1990, general manager, Tegal semiconductor unit; 1990–1993, senior executive vice president and assistant chief operating officer; 1993–1995, president and chief operating officer; 1995–2003, chief executive officer; 1999–2003, chairman of the board.
■ Christopher B. Galvin was an enigmatic man. By turns he was dynamic, decisive, and aggressive but also slow, cautious, and hesitant. He was an intense and determined leader but at the same time an intellectual given to thinking over problems. As he rose through the ranks of Motorola, he impressed coworkers with his decisiveness, but when he became the company's CEO, he inherited the leadership of a huge corporation that was profoundly troubled by marketplace shifts and changing technology. He seemed defeated in his effort to internalize and understand all of the company's complexity, trying to create a new set of relationships among his company's parts that were both profitable and honorable.
Even as a child, Galvin was intense and mature for his age. While his siblings played games, he chose to work, shoveling sidewalks or selling homemade butter door to door to earn money. During his college years, he worked summers selling
Motorola's two-way police radios in Chicago. After finishing his undergraduate studies, Galvin became a full-time salesperson for Motorola's radio division while he worked toward his master's degree, which he completed in 1977.
Galvin was soon given an opportunity to prove himself at the company. Motorola's dominance in the pagers market had been challenged in the early 1980s by Japanese companies that sold their products below cost. Galvin was put in charge of the company's so-called Operation Bandit along with Motorola's director of manufacturing, T. Scott Shamlin. The goal of the operation was to restore Motorola's competitive edge in the pagers market by making radical changes in manufacturing. With over 20 million possible number configurations, a pager usually took 27 days to make. Shamlin and Galvin, however, designed a new production process for use at a plant in Boynton Beach, Florida, that turned out pagers in only two hours apiece.
After the success of Operation Bandit, Galvin joined his father on Motorola's board of directors in May 1988. He then rose to the positions of senior executive vice president and assistant chief operating officer in 1990, moving up to become president and chief operating officer in 1993. The mid-1990s were a heady time to be in charge of Motorola. The company netted $1 billion on $17 billion in sales in 1994 and peaked with 60 percent of the world's wireless telephone market in 1995. In 1996 it began a steep decline, however, falling to 26 percent of the market as leaner and more aggressive companies like Nokia introduced smaller and more stylish telephones.
TROUBLE AND TEMPORARY TURNAROUND
Galvin became Motorola's CEO in January 1997. He made his first major blunder by keeping the company focused on analog telephones for the next two years, even though customers were switching to digital equipment. Nokia eventually took the world lead in market share from Motorola. Galvin also committed Motorola to investing heavily in Iridium, a space-based wireless system with 66 orbiting satellites, by backing the system with $800 million in bonds in 1997. In April 1998 Galvin reorganized Motorola by combining 30 smaller units into one large communications division in an effort to end the internal bickering that was slowing development of new products.
Galvin delegated authority to subordinates in his first years as CEO, allowing his managers the freedom to make short-term decisions without going through the corporate bureaucracy for permission. His management style, however, had the unintended consequence of his subordinates' failing to tell him about problems. When Galvin became chairman of the board in 1999, Motorola seemed to be making a strong turnaround, its stock rising from a 1998 low of $38.38 per share to $100.19. Motorola shifted telephone production to digital wireless models, and its small V-series units sold well. In May 1999 Galvin directed Motorola's purchase of General Instruments, a broadband cable manufacturer, as part of a strategy that would allow customers to connect to the Internet from their telephones. Motorola's profit was $1.3 billion that year, and the kindly and thoughtful Galvin was well liked by his employees.
Galvin finally discovered in 2000 that some of his managers had been covering up their failures and fired 11 of Motorola's 19 upper-level executives. He then trimmed $750 million from the company's operating costs. Motorola's stock peaked at $134 per share in April 2000 before dropping to $86.75 in May. At the same time the company lost $2.6 billion on its investment in Iridium, which it transferred to Boeing. Some executives suggested selling Motorola's semiconductor manufacturing division at the same time, but Galvin refused.
Between 2000 and 2003 Galvin laid off over 60,000 employees and closed four semiconductor and pager-manufacturing plants. There was controversy over his receiving a high salary while his company declined, as he was paid over $11 million in 2002. By 2001 Motorola held only 14 percent of the wireless phone market. In May of that year Motorola's stock fell to $15 per share, rising to only $16.75 in July. Galvin then decided that managing by delegation was an unworkable approach. He reorganized Motorola's corporate structure to eliminate layers of middle management while he took a more active part in managing Motorola's major divisions.
Galvin remained popular on the personal level, as his associates considered him a pleasant person. Introspective by nature, he tried to absorb and comprehend all aspects of Motorola's business and spent long hours developing strategies that would benefit the entire company. This habit slowed his decision making, and he appeared to be losing touch with the rapidly evolving high-technology marketplace. Ever an optimist, however, he insisted that "all [the company's] problems are solvable" (BusinessWeek, July 16, 2001).
The company's slide continued into the following year. In July 2002 Motorola's shares dropped to $11.98 each. Galvin owned 14 million shares with options on 2.7 million more, so he felt the deep decline in Motorola's market value as much as did the company's other investors. Other Motorola executives repeated their earlier suggestion to sell Motorola's semiconductor manufacturing division with an eye to focusing on wireless telephones, but Galvin again said no. He believed that he was finally turning the company around and could save all the divisions that he had inherited from his grandfather and father. The board of directors had changed in recent years, however, with Galvin family loyalists having been replaced by outsiders. These new directors wanted to divest some of Motorola's less profitable holdings. Galvin was forced to resign as CEO and chairman on September 17, 2003, although he was guaranteed an office and salary for two years while remaining as an adviser to the new leaders. Motorola's semiconductor products sector was finally spun off in October 2003.
See also entry on Motorola, Inc. in International Directory of Company Histories.
sources for further information
Alster, Norm, "A Third-Generation Galvin Moves Up," Forbes, April 30, 1990, pp. 57–59.
Crockett, Roger O., "Chris Galvin on the Record," BusinessWeek, July 16, 2001, p. 76.
——, "Motorola," BusinessWeek, July 16, 2001, pp. 72–75.
—Kirk H. Beetz