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Leadership and Strategy - All Change at the Top for Blackberry

Monday, January 23, 2012
by Jim Riley

A fantastic quote here from the departing co-CEOs of RIm (owner of BlackBerry) as they depart for pastures new…

“There comes a time in the growth of every successful company when the founders recognise the need to pass the baton to new leadership”

As the Guardian reports, “BlackBerry maker Research In Motion (RIM) co-chief executives, Mike Lazaridis and Jim Balsillie, have bowed to investor pressure and resigned”.

The new CEO, Thorsten Heins, faces some significant strategic challenges:

- A plummeting share price
- Shrinking market share in the core US market
- Widespread criticism of Blackberry products
- Strong competition from Apple, Google and Samsung (amongst others)

It sounds like Thorsten Heins faces the same issues that Nokia CEO Stephen Elop is handling. Maybe the two of them should meet up for a chat.

Will the departure of Lazaridis and Balsillie make it easier for Heins to make the necessary changes to RIM’s business?  Possibly, although RIM seems to have experienced a significant decline in its competitiveness in recent years.  That’s something that a new CEO will find it hard to reverse.  Just look at the struggles that Elop has had at Nokia.

The evidence is in the data.  For example, according to the Telegraph, RIM’s share of the smartphone market in the US dwindled to just 16.6pc in the three months to the end of November 2011. That compares to just under 50pc for phones using Google’s Android operating system and 28.7pc for Apple.

No wonder shareholders have been uphappy too. RIM has lost over $70bn of value since its market capitalisation peaked in 2008. 

It looks like RIM needs some “transformational leadership” and Reuters quote investment analysts who explain why:

“Activist investors have clamored in recent months for a new, “transformational” leader who could revitalize RIM’s product line and resuscitate its once cutting-edge image. It remains to be seen whether RIM has found such a leader in Heins, analysts said.”

Is Heins the right man for the job? Show students this video which introduces Thorsten Heins and ask them for their initial impressions:

 

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