The Evolution of Motorola’s Global Financial Supply Chain Strategy Ian D. Blackman Christopher P. Holland Tim Westcott Brunel University Manchester Business School Motorola ian.blackman@brunel.ac.uk chris.holland@mbs.ac.uk tim.westcott@motorola.com ian Abstract This paper charts the progress of Motorola’s global cash management strategy encompassing Motorola’s internal factories worldwide, Motorola’s customers and suppliers, and partner banks in the US, Europe and Asia. It explains how their financial supply chain strategy has evolved over a period of over thirty five years from a relatively simple internally focused system into a fully integrated global system that enables the flow of currency and associated foreign exchange processes to mirror the Just-In-Time (JIT) flow of products throughout the supply chain. The performance of the finance systems is analyzed using detailed statistical techniques including six-sigma. The strategy is characterized by incremental changes punctuated by significant shifts in the strategy, organizational design and information systems. It is demonstrated that the financial processes that connect Motorola with its suppliers enable the supply chain to behave more like a single, cohesive unit rather than a collection of autonomous organizational units. 1. Introduction The globalization of markets has attracted increasing attention in the academic and business literature and although there is continuing debate into the extent and nature of globalization in terms of market behavior and trends, the structure of supply chains and organization design, it is widely accepted that all types of businesses must develop their production and marketing strategies in a global context. This is particularly true in the high technology and banking markets, which have been at the forefront of globalization. In this paper we examine the globalization process in Motorola’s financial supply chain. The strategy analysis incorporates theory elements from the strategy, IS and operational management literatures. An outline of the relevant theory concepts is given below. In his seminal article, Levitt [1] identified the importance of the globalization of markets, and in particular the standardization of products to suit global markets. Although the overarching trend towards common, global standards and products have been questioned, and the importance of local requirements have received more attention, the trends described and forecasted by Levitt have been of particular importance in high-technology markets. The Internet, cheaper travel and the availability of low-cost manufacturing have all contributed to the homogenization of many high-tech consumer markets, particularly computing, mobile phones and software. These market changes have been accompanied by the emergence of global organizations, which have defined and shaped their strategies in order to take advantage of global standards and increased standardization, whilst also recognizing the importance of local market requirements. Other examples of global technical standards include GSM in the mobile phone industry and de facto standards defined by dominant market shares e.g. computer operating systems, Microsoft’s office productivity software and eBay’s shopping platform. The critical element of any global strategy is to be able to manage and co-ordinate operations efficiently in order to achieve economies of scale and maintain or lower their operating costs. Dicken [2] makes a distinction between the notion of ‘pure’ globalization exemplified by Ohmae [3] and more complex developments where geography and local product design are reflected in the structure and management of international supply chains. An important analytical tool that emerges from the discussion of globalization is the network concept of inter-linked organizations, typically formed into a supply chain that manages the flow of raw materials, product assembly, manufacturing and distribution through shared business processes and Information Systems. Multinational organizations have gained huge benefits from the integration of management processes within their organizations through the use of Enterprise Resource Planning (ERP) systems that have been accompanied by the development of shared information systems along the supply chain, either by simple EDI systems or more sophisticated electronic business standards such as RosettaNet. The supply Proceedings of the 44th Hawaii International Conference on System Sciences - 2011 1 1530-1605/11 $26.00 © 2011 IEEE