Last week I wrote about how companies’ lacking a coherent vision are struggling to stay profitable. This week we have another example of how low corporate self-esteem hurts businesses as Blackberry maker RIM get ready to make swingeing cuts.
The announcement that the Canadian manufacturer would be cutting 2,000 jobs from its workforce of 16,500 wasn’t unexpected, and whether the cuts will be spread across the company or consolidated in a specific area remains unconfirmed. If new CEO Thorsten Heins wants to get the company back from the brink of irrelevance, however, he should leave his developers and engineers well alone.
Like HP – covered in last week’s column – RIM has struggled to stay relevant in the ‘post PC age’ where novelty, design and usability have become more important than spec and reliability. However where HP’s problems were largely caused by corporate ructions, Blackberry’s dated design and anemic app store has seen its market share in the US dip from 13.6% in the first quarter of last year to 6.4% in the same period for 2012. Revenues have also suffered, with the first quarter posting $4.2 billion versus $5.6 billion over the same period last year. Add to this the PR debacle of last year and subsequent departures of co-CEOs Mike Lazaridis and Jim Balsillie; software CTO David Yach and COO of global operations Jim Rowan and you can understand why investors would be demanding austerity instead of invention. Heins is now in the position of having to be seen to be doing something, and if that something involves saving money his position should be secure in the short term.
If investors can be sated, however, the consumers who are ditching their Blackberrys en masse will not be. In this writer’s opinion three things need to happen to stop the rot and entice users back to the fold: promote difference; ditch Blackberry’s physical keyboard; and aggressively target the tablet space.
It would appear the second point, ditching Blackberry’s physical keyboard is not up for debate. A quick perks through its website show the iconic design isn’t going anywhere, though the Curve 9380 (pictured) and Torch series show an effort to provide an alternative to the iPhone and devices by Samsung and HTC without alienating the core business audience.
As for promoting difference the best way sell Blackberry as a viable, contemporary alternative is through a new user interface. RIM is on top of this with its Blackberry 10 operating system.
Unveiled at Blackberry World earlier this month, Blackberry 10 is designed to let apps ‘flow’ across the screen. A tiled interface overlays apps that you can navigate within by swiping forwards and back. It looks like a credible alternative to Apple and Google offerings, though by the time we get our hands on a device its main competitor will likely be Microsoft Windows Phone. That the demo given at Blackberry world was on a touch screen phone maybe we have gotten a glimpse of things to come. See point one above.
And now for the tablet space. The first incarnation of the Blackberry Playbook was a disaster. The lack of an e-mail client, decent app store and poor user experience ensured it would be an also-ran when compared to the iPad. Yet if RIM wants to compete in the mobile space it cannot afford not to have a tablet device. Its current incarnation is geared towards the home user, which is a smart move considering the movement to ‘bring-your-own-device’ culture in business but it still lacks a killer app.
Will RIM manage to get through its latest crisis? It has some good hardware and novel software, so the simple answer is ‘yes’. Its only problem is it still doesn’t know its audience has moved on. ‘Unsexy but reliable’ is so 10 years ago.
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