No company that falls behind the competition is guilty of standing completely still. But sometimes our efforts fail because of the level of commitment to change.
– Tom Kelley and David Kelley
BlackBerry, formerly known as Research in Motion (RIM), was a market leader and innovator for smartphone products. The business and government sectors found the BlackBerry device particularly useful because of its email capabilities, superior security system, and convenient keyboard. As the smartphone industry began to shift its focus towards the average, everyday customer, competition increased, and BlackBerry’s first-mover advantage began to decline. Over the past five years RIM has changed its corporate name to BlackBerry, been purchased by private equity firm Fairfax Financial, written down over $1 billion in assets and unsold inventory, and laid off more than 40% of its workforce (Connors).
BlackBerry’s fall from market leadership and financial success is the result of a corporate structure that failed to foster individual employee creativity and company-wide innovation. The financial distress, upper-management turnover, and loss of strategic direction are symptoms of BlackBerry’s problem: a failure to innovate and remain competitive in the smartphone market.
Recent attempts to regain foothold in the smartphone market include the unsuccessful launches of the PlayBook tablet in 2011 and Z10 and Q10 phones in 2013. These attempts to dismantle the iPhone and Android market power have resulted in BlackBerry trying to mimic its competitors rather than producing cutting edge products that create value for its customers.
Conflict and a bureaucratic corporate culture are largely to blame for the lack of creativity and innovation in BlackBerry. Resistance to change was ingrained in the management structure of BlackBerry. RIM founders and co-CEOs, Mike Lazaridis and Jim Balsillie, shared leadership duties, and as RIM’s BlackBerry grew in popularity during the early millennial years, the two leaders began to disagree on how to expand and operate the company. The conflicting perspectives on how to grow and produce competitive products stifled the innovative processes and speed at which RIM could work. RIM began to develop a reputation of being slow to bring products to market, and once to market, these products were lacking in innovative features.
Following the January 2012 departure of co-CEOs Lazaridis and Balsillie, Thorsten Heins assumed the role of CEO. A year later, RIM was purchased by Fairfax Financial and became a private company. Heins’ role as CEO of the newly named BlackBerry was short-lived, as he was replaced by John Chen in November 2013. Chen now faces the issue of re-directing the strategic vision and innovative environment of BlackBerry in hopes that the company can restore its former success.
Organization Theory & Application
Chen’s challenge to revitalize BlackBerry rests on his ability to cultivate a work environment...