The Blackberry Verdict Is Not Surprising
In 2013, I wrote a book titled “FLAT ARMY: Creating a Connected and Engaged Organization.” I recently hummed and hawed about whether I should update it with a second version, or write my third original book. I chose the latter but recent news that Blackberry will no longer be manufacturing mobile phones led me to think about what I wrote about the company in Flat Army.
I thought I would share those words below in their entirety. (Of course, back then the company was still called Research in Motion or RIM for short.)
My last line includes “only time will tell.” Well, time has told us the company has made blunder upon blunder. If it does manage to turn it around–operating solely as a software maker versus a software and hardware maker, entering into a licensing agreement with an Indonesian company to make and distribute Blackberry branded devices–it will be incredibly ironic that the company that switched its name from Research in Motion to Blackberry will no longer be designing and manufacturing the device it changed its name to.
From Flat Army:
Which brings us to another example, this one dealing with Research in Motion, more commonly known as RIM — makers of the iconic Blackberry smartphone. Pundits from San Francisco to Siberia to Sydney have written off this Canadian company since 2008. Many claim RIM is no longer relevant in an Apple, Google, Samsung and Microsoft dominated smartphone ecosystem. According to Canaccord Genuity Estimates, RIM’s global market share dropped from 19.7 per cent in 2009 to 10.8 per cent by the end of 2011. It further predicted a market share drop to 6.1 per cent by the end of 2012 and 4.9 per cent by the end of 2013. Whether you’re a shareholder, a customer, an executive or an employee, those numbers are difficult to digest. Gloomy is one word that comes to mind. What happened?
Kara Swisher is co-executive editor of the popular Silicon Valley based media organization AllThingsD and has been outspoken about RIM on several occasions. In September of 2012, for example, while speaking at a Women in Film and Television event, she stated the following:
“RIM is a perfect example of failing to respond to consumer changes. <Mike> Lazaridis is a genius. But RIM missed so many consumer trends because they were protecting an old business. In the end, they broke their consumer relationship by not innovating.”
The ‘Lazaridis’ she refers to was ex co-CEO Mike Lazaridis who, alongside fellow co-CEO Jim Balisillie, helped bring RIM to the forefront of innovation and success only to see it — and their roles as co-CEO — vanish before their eyes. Through a 20-year span, it could be argued both men helped launch the smartphone industry itself. Blindsided by the success of the Apple iPhone however — which launched in 2007 — it could be argued Lazaridis and Balsillie were the reason for both RIM’s success and its recent collapse. They knew what worked up until the height of RIM’s dominance, but rather than adjusting and having the foresight to alter course, they remained shackled to what worked from their past. In doing so, their stock price went from roughly $140 to $7 in a four-year period. Gulp.
Rather than being rigid and inflexible and incapable of change, what if the elements of Flat Army had been employed at the company many moons prior? Would it have made a difference? There is reason to suggest RIM was a company of command and control habits. There is reason to suggest Lazaridis and Balsillie didn’t listen to or involve their employees. For this type of closed-minded behaviour the company is dearly paying a price. Could Flat Army save it still?
By way of example, in the summer of 2011 an anonymous letter from a high ranking RIM executive was sent to Jonathan S. Geller, founder of the popular mobile and telecommunications website BGR. Geller verified the source and proceed to publish the letter to the site. The letter starts out as follows: (accessed August 31, 2012. )
To the RIM Senior Management Team:
I have lost confidence.
While I hide it at work, my passion has been sapped. I know I am not alone — the sentiment is widespread and it includes people within your own teams.
With confidence and passion lacking not only with this leader but alleged to be widespread, it really comes back to our thesis in Chapter 1; this employee has become disengaged and if it’s afflicting others, there is no doubt the company could be in for future worrisome troubles.
The letter goes on to state:
Reach out to all employees asking them on how we can make RIM better. Encourage input from ground-level teams—without repercussions—to seek out honest feedback and really absorb it. We should also address issues surrounding making RIM an enjoyable workplace. Some of our offices feel like Soviet-era government workplaces.
Does this sound to you like the makings of a Flat Army organization or is its leadership team in a state of denial?
Dr. Marc Weber of the University of Waterloo — which coincidentally is in RIM’s backyard — asserts that given the choice between individualism and the situation, people will naturally gravitate toward the situation rather than their own individuality. In other words, if the behaviors of an organization are, for example like RIM — hierarchical, rigid, closed, non-collaborative and uncooperative — even if an individual employs the opposite of these traits at a personal level and from the onset of their arrival — the employee will, over time, act more like the organization (the situation) than how they might have behaved prior to joining the organization.
What was the situation at RIM? It was an organization whose leadership and leadership behaviours were closed and unrepentant. There was no evidence of collaboration once the Apple iPhone arrived on the scene. Communication channels seemed to be non-existent between staff and senior management. The situation at RIM was one of ego, bravado and ruthless ignorance. The situation was a giant example of groupthink. To many RIM seemed to morph from an innovative and flexible organization to one that was rigid, blind and hierarchical. The situation at RIM was ignorance and many of its leaders were culpable. The situation has become a vortex with close minded behaviour at the root. It has landed the organization in the deepest of all crises leading to the reduction of its workforce by over 5,000 employees and operating expenditure by over $1 billion in 2012 alone.
There are some interesting developments at RIM though. Firstly, Lazaradis and Balsillie heeded the calls to resign and did so in early 2012. Thorsten Heins — RIM’s COO at the time — took the reins and has been leading the charge to turn around the company and its future outlook. In the summer of 2012, Heins wrote an editorial in The Globe & Mail where he stated:
“RIM has chosen to pursue a strategy that eschews the homogenized sameness of competing ecosystems. To help with that task, we have reshaped the executive team and recruited telecommunications industry veterans with proven track records of success.”
I found it compelling if not confirming that the leadership of the organization had to be both ‘reshaped’ and ‘recruited’. This says to me Heins is in the midst of reshaping and recruiting a culture that is potentially diametrically opposed to the situation that used to envelope the organization. It seems as though the situation is in need of a change. Perhaps Heins is in fact about to deploy Flat Army concepts such that RIM can pull off a similar turnaround like that of IBM, Apple or Ford — the stuff of corporate change legendary lore. With new devices set to launch in early 2013, only time will tell.