Sophistication. Professionalism. Business Savvy.
Starry eyed and new to world of business, the Blackberry represented just that to me. One of my first interactions with a true business leader and mentor was a district manager of a store I was employed. He would travel to different parts of the state to review our sales, performance, and merchandising. He was professional and had business smarts about him as he walked through the store with a briefcase and a charismatic personality. I wanted to be just like him. At all times, it seemed, he had with him a Blackberry. It was a communication tool for connecting to other stores and the home office with reports and performance metrics. In my naivety, I quickly associated the Blackberry with these characteristics.
Blackberry at this time was booming. In 2009, it was even rated by Fortune magazine as the fasted growing company in the world. It had 84% sales grow increase per year. According to David Goldman in a 2009 CNN Money article Blackberry is Still Leader of the Pack “experts cite competitive pricing, business expertise, and new consumer products as reasons for RIM’s sustained growth.” In 2007 the stock price of RIM (Research in Motion is the former name for Blackberry) was as high as $236 per share and now the stock price is just under $7. Something must have happened.
And something did happen.
In 2007, the first Apple iPhone was introduced with is touch screen keyboard and app ecosystem. Unlike the Blackberry, which catered to the business professional and government employee, it was catered to the everyday consumer. Apple was able to pivot by shifting its business focus when it perceived that iPods were beginning to show signs of product maturity. It adapted to combine music, email, phone calls, and applications on one device. This adaptation to the dynamic technology industry was crucial to the success of its product line. Innovation was a strategy that gave Apple a competitive advantage.
Meanwhile in Canada…
While the iPhone was building in popularity with consumers, the Canadian based Blackberry sat back in its comfortable market space and continued to produce the same Blackberry product. Slowly, its product lines were becoming irrelevant in a world of advancing smartphone software and technologies. According to a Canadian analysis of the company, there were ideas by top management on how to work through the problems that were arising in the beginning but the good decisions failed to be implemented.
One of the responses by the CEO at the time, Mike Lazaridis, was to buy a software development firm called Torch Mobile. This firm specialized in internet browsers for mobile phones. What iPhone did that Blackberry didn’t was have a fully Internet-capable browser. Furthermore, Apple and android used newer software platforms as compared to RIM. Lazaridis’ decision to buy this firm was a signal that he would lead the company into a red ocean strategy (where the market is full of sharks and bloody with competition). It was a mistake to decide to be a copy of the top competitors and to go head to head against the competition with which it was already losing.
Back at the workplace….
I watch as the third party tech rep stops by to pick up a Blackberry from the marketing department to be repaired. It is dropped with a hollow THUNK! into a box of broken Blackberries that are soon to share the same fate. THUNK just like the stock price of Blackberry. They should have thunk outside of the box and thunk sooner. The box full of outdated Blackberrys was a symbol of the slow response and the lack of innovation that began the company’s downfall. What had been a symbol of authority and sophistication to me was now a symbol of poor decisions by leadership and poor corporate strategy.