Corporate Renewal-Current Event-RIM restructuring

Research in Motion, in my opinion one of the pioneers in smartphone with the introduction of the Blackberry, has been on a recent slump.

According to the Wall Street Journal “Research in Motion Ltd. has started laying off small batches of employees, part of a broad restructuring meant to cut costs at the struggling BlackBerry-maker...”( Connors,2012).

This is incredible, because not too long you couldn’t see any business or for a matter of fact any “cool kid” without a blackberry. As Alastair Sharp in the Reuters reports RIM “virtually invented the concept of on-your-hip email with its first BlackBerry devices” (Sharp,2012) Before the new wave of smartphones, the icon of smartphones was the blackberry. The keyboard and the ability to check emails with RIM’s technology, in my opinion made an icon of cutting edge mobile device technology. Since the introduction of the Iphone and Android seems like they have cut into Blackberry’s market share  and RIM has been trying to find ways to come back.

According to the Reuters report “RIM, based in Waterloo, Ontario, said it had hired the bankers from JP Morgan and Royal Bank of Canada, after releasing its year-end results in late March to aid its strategic review.It wants them to evaluate strategies including an overhaul of its whole business model, as well as less dramatic moves such as expanding the BlackBerry platform through partnerships and licensing deals.”(Sharp,2012).

This can be seen as part of the corporate renewal in which RIM tries to bring outside forces to see how they can expand their market share. “Other smartphone makers still cannot compete with the security features on RIM's devices, something that has made the BlackBerry a crucial tool for police, government and military use.” (Sharp,2012) In my opinion this can have a great advantage and can make the company very attractive to bankers. In recent weeks, I have seen many commercials for RIM in which they try to attract the young, hip crowd. I believe they are making a big mistake because instead of  showcasing their strengths, they are trying to  target  a consumer base that loves to watch HD videos and user friendly apps. The bankers in my opinion will be able to introduce new ideas to a culture that was accustomed to always being the leader.

According to the Wall Street Journal report “In recent months, RIM has confirmed the departure of a number of senior executives as part of its restructuring.” (Connors,2012).

The changing of the guard as one may call it, will either break or make the company. The culture that the company had seemed to be stuck in the past. In my opinion, RIM seemed to be only reacting to what the competitors were doing. There is one phone of the blackberry product line that really did it for me, the Blackberry Storm. It came out during the iphone craze, was an all touch click screen. The phone was so slow with its operating system that I swore I would never go back to it. It seems like since then it has been just imitating its competitors in order to stay alive.

According to Daniel Shen in Digitimes, “Wistron as well as Jabil and Flextronics International will have a chance to receive more smartphone orders from Research in Motion (RIM), as the Canada-based smartphone vendor is restructuring its supply chain” (Shen,2012)

It seems that RIM will also be looking to find ways to make its supply chain more cost effective. In my opinion, the restructuring of the supply chain will be a a crucial step in bringing RIM back to its previous status. The competition among suppliers to still be RIM’s part supplier will make them be more innovative with their production, not only perfecting their production but also finding cost effective methods. The concentration of the supply chain may also help RIM’s communication and ease the production of their blackberry and get them to market quicker.

RIM’s still has a long way to go and I believe has many great assets which I bet many competitors are salivating over.  While the brand itself may not be worth anything, the technology which RIM pioneered may be the extremely attractive. I believe that this year, will be a crucial time to RIM and everything from the things you can put a value to, such as the technology, to the ingraspable (culture) must have a wake up call. It is my opnion that if RIM does “wake up” it can gain back many of its consumer base as many of us in the financial district, speaking for myself, are still trying to get use to these digital keyboards.

Sources:

Shen,Daniel. Shen,Steven. “RIM restructuring supply chain; Wistron may benefit, say sources” Digitimes.June 20,2012. Web. June 24,2012. <http://www.digitimes.com/news/a20120620PD205.html>

Connors, Will. “RIM Shedding Jobs; Part of Broad, Cost-Cutting Measures” Wall Street Journal. June 19,2012. Web. June 24, 2012. <http://online.wsj.com/article/SB10001424052702303703004577477423617448832.html>

Sharp, Alastair. “BlackBerry maker RIM sees operating loss, shares slump” Reuters. May 29,2012. Web. June 24,2012.

 < http://www.reuters.com/article/2012/05/29/us-rim-warning-idUSBRE84S19D20120529>