Gina Smith pens a letter to Thorsten Heins, the new CEO of RIM with what's he's going to have to do to turn the company around.
May I call you, Thorsten? Herr Heins, if you prefer, works, too. Here in Silicon Valley, we're a bit more relaxed about such things.
First, congratulations on your new post as CEO of Research in Motion. Moving from COO to CEO is a big change, as you must be aware, and you're moving from looking at things microscopically to macroscopically. You're moving from looking inward to looking outward — evangelizing. Can you do it? The industry's expecting you to man up and lead. Certainly, you have the experience, coming as you do from a variety of senior leadership roles at Siemens AG back in Germany. And undoubtedly, you have the same frustrations shared by most RIM employees — frustrations with continuing quarterly losses, dwindling marketshare and competition from companies RIM never expected in its space.
As a hardware guy, watching the company flounder under co-CEOs Mike Lazaridis and Jim Balsallie must've been awful. And then there's the rubber necking — or what you might call, schadenfreude. (link to http://www.merriam-webster.com/dictionary/schadenfreude) People unfortunately do derive pleasure watching the suffering of others and RIM"s been tied to the whipping post for way too long. But ignore them and let them galk. RIM is still the biggest tech company in Canada and despite what the rubberneckers say, it isn't too late for RIM. Speaking from the standpoint of enterprise, where RIM's Blackberry still is the gold standard, here's a roadmap back to success.
1. If you didn't write it — you might have — go back and read the Jun 2011 anonymous letter to RIM's senior management employees posted last summer. Employees have lost passion and are increasingly bitter about RIM's slide toward obscurity. As the anonymous writer said, RIM "often (makes) product decisions based on strategic alignment, partner requests or even legal advice — the end user doesn't care. We simply have to admit that Apple is nailing this and it is one of the reasons they have people lining up overnight at stores around the world ... these people aren't hypnotized zombies, they simply love beautifully designed products that are user centric and work how they're supposed to work." Blackberry designs, especially its recent ones, are stellar, but the OS functionality is awkward and lacking.
2. Lead, don't manage. Your workforce is hurting after the big July 2011 layoff, the largest in your company's history. And then there are the drunk employees on a business trip that forced a flight from Toronto to Beijing to land. These folks are miserable — uncharacteristic for generally easy-going Canadians — and to get them back on track you're going to have to bring them into your game plan. That game plan can't be just to bring out a revamped QNX or focus more on consumers, as you say in your announcement video (link). It has to be a wholesale game plan change. Wall Street won't like it at first, but you've got to keep your eye on the prize. Without a strong team and serious evangelical leadership, RIM's fortunes will keep declining.
3. Don't abandon the enterprise in favor of the consumer market. That's a false distinction you make in your video. The users in enterprise are consumers. Yes, RIM is still the standard device in corporations worldwide, as millions upon millions of corporate employees with IT-issued Blackberry smartphones. But many of them carry both their Blackberry and an iPhone or Android device. Find out why. The Blackberry hardware is, in some ways, better than what Apple Samsung, Nokia and others. Certainly its camera capabilities used to be dramatically better. But the world has caught up. Your software hasn't. The fact that a Blackberry user — this is a consumer in the enterprise — has to know an obscure list of ALT commands to operate it as a power user is unconscionable. I mean, really. ALT Q to render a hash tag? Remedy this in QNX. You must. Get the user-interface to consumer standards and you won't have to worry about two markets — consumer and enterprise — as you say in your video. They are one in the same. Consumers have jobs. Make them love that Blackberry and ask themselves, why should they also get an Apple iPhone or Android device, not the other way around.
4. Speaking of QNX, seriously considering splitting your company into hardware and software divisions. It's true that Blackberry delivers a secure end-to-end experience, but what you've got isn't working. Hire Jon Rubenstein, nee Palm, who has got to be miserable over at Hewlett Packard about now. Sell Blackberrys that run QNS, WebOS, even Android.
5. Spend RIM's money in innovation, not in stupid and easy-to-avoid settlements resulting from stock option scandals. Recall what happened to former co-CEO Jim Balsillie in 2007 — he had to resign as chairman of the board because of a $250M earnings restatement and backdated stock option scandal. Make sure the company does not repeat such hijinx.
6. Go green. It didn't escape anyone when RIM ranked last in Greenpeace's Guide to Greener Electronics (link). Corporations increasingly care about such things, hard as it might be for a hardware guy to imagine. Get external verification of your greenhouse gas emission policy and set up a plan. This will help you not only in this hemisphere, but in Europe, especially.
7. Don't try to be Steve Jobs. Remember your roots. RIM pioneered this space, the same way Apple pioneered personal computing. Apple's turnaround from a couple bucks a share under CEO Gil Amelio to the world's largest tech company with returning CEO Steve Jobs in 1997 shows its possible. Jobs, like you, had no experience or reputation as a "turnaround" executive. But he got employees to believe again by making radical changes in the way the company manufactured its goods, trimming fat, and by introducing dramatically different products into the market. You don't have to wear a black turtleneck or be that good on stage for this. Lead by example, not words. Operate RIM the way RIM deserves to be operated — as a pioneering company that still, despite its losses, is the largest tech company in Canada. It is not too late.
8. Let the naysayers eat your dust. As with the schadenfreude, there are a lot of folks waiting for RIM to bite the dust. Let that drive you and your company forward. Don't march with silliness into a consumer market or make an artificial distinction between it and the enterprise. Remember what you've got. Blackberry 7 is, in truth, not bad at all. The Bold 9900 series is a great product. If you ghettoize the enterprise and focus on an artificial group you in your video call "consumers," you'll be sorry. Remember that consumers in the enterprise are consumers after 5 and on weekends, too. They use Gmail. They take photos and want to keep them safe from IT should they suddenly have to surrender the unit. Every human carrying both a Blackberry and an iPhone is testament to RIM's failures over the last months. Turn that around. Make the software match the hardware. Remember the advantage you come in with — a real foothold in corporations — and don't lose it.
Good luck with this.
Gina Smith is an award-winning tech journalist and New York Times best-selling author of iWoz: How I Invented the Personal Computer and Had Fun Doing It (WW Norton, 2006). Her latest book, co-authored with former AIG Europe chief, Herta Von Stiegel, is The Mountain Within: Leadership Lessons For Your Climb to the Top. (McGraw, 2011). She was among the first five employees at CNET in the early 1990s and most recently led the relaunch of BYTE. For Tech Republic, she is focusing on the consumerization of IT. She's also editorial director at the consumer tech site, aNewDomain.net, with John C. Dvorak and Jerry Pournelle.