Saturday, 31 March 2012

BlackBerry-maker RIM’s bold new world


BlackBerry-maker RIM’s bold new world
 March 30, 2012 Carmi Levy
You’ve got to hand it to Research In Motion CEO Thorsten Heins: He listens.

When he first moved into the BlackBerry maker’s corner office in January, he was roundly criticized for not breaking with the past. In his first post-promotion interviews, he praised his predecessors, co-CEOs Mike Lazaridis and Jim Balsillie, and said he saw no need for radical change.
Investors, already jittery from a year that saw share values plummet to record lows, bristled at the prospect of an insider seemingly intent on perpetuating the same disconnected policies that got the company into trouble in the first place.


What a difference two months can make.

Thursday’s bloodbath, where the company reported a $125 million loss in its most recent quarter amid reduced revenue, sinking BlackBerry sales and a huge writedown in goodwill, seems to have been just the ticket for the new CEO to start digging deeper as he seeks ways to staunch the bleeding. Ex-CEO Jim Balsillie has resigned from the board, and the chief operating officer and chief technology officer are gone.
Sources say significant numbers of senior leaders, including executive and senior vice-presidents, are being shown the door. They say cuts further down the org chart are also being made as Heins strives to slice away vestiges of the old RIM.

Ugly? Yes. Absolutely necessary? Of course. And Heins has clearly seen the light.

It’s convenient to focus solely on the numbers, but there’s a silver lining in the company’s current predicament.
Let there be no doubt: RIM faces at least two or more quarters of devastating results before new devices based on the new BlackBerry 10 operating system hit the market and begin to impact the bottom line. But the brutal, light-speed change going on within RIM’s campus now is the most solid sign yet that the company, after years of arrogantly ignoring external reality, is finally reorienting itself.
As Heins accelerates RIM into a radically different structural and cultural future, he’s faced with the almost impossible task of sustaining demand for an increasingly tired product lineup while the engineers feverishly work on the next generation hardware and software. There’s no guarantee that BlackBerry 10 will be good enough to keep RIM close enough to Apple and Google, and no guarantee that it’ll be enough to bring consumers back into the fold.
Even good enough won’t be sufficient. Like the original BlackBerry that defined the mobile messaging category, whatever comes next can’t simply be a me-too effort.

As Heins continues to shape the organization in his image, he’ll need to make sure it allows everyone who has any influence over product design to swing for the fences. RIM had been cruising for too long, incrementally updating long-obsolete products because no one had the guts to take a chance on a ridiculously edge-of-the-bell-curve feature. For a company that consistently outspends Apple in R&D, the lack of customer-facing innovation is shocking – and needs to end if RIM is to have a prayer.

The honeymoon may be pretty much over for Heins, but this week’s results don’t necessarily mean the marriage is destined to crash and burn. He’s shown a willingness to make the hard decisions to stabilize RIM’s fall from grace and point the company in a more stable direction.
But his window of opportunity continues to shrink, and BlackBerry 10 now looms as his single, best shot at redemption. If the new platform fails to ignite consumer interest, no matter how effective the new org chart is, the new CEO may as well pull out the prenup and call a lawyer.

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