Designing Strategy - Rim

1. Identify and describe the two most important reasons why RIM is struggling?

The two most important reasons why RIM is struggling are (1) the overconfidence and poor organizational design put in place by RIM’s co-CEOs and (2) the company’s inability to keep pace with the competition in terms of new product development.

Mike Lazaridis and Jim Balsillie built RIM from nothing into a global powerhouse, but over time the company became a victim of its own success. As the popularity of Blackberry devices exploded, Lazaridis and Balsillie did not set up a management structure built to survive increasing competition and a rapidly changing marketplace. Instead, they dismissed Google’s Android platform and Apple’s iPhone as no threat, and they ignored the smartphone customers’ shift in preferences away from pure communication towards more media consumption. They focused on their battery life advantage and their stranglehold on the enterprise market, while they lost out on the growing consumer market. While RIM bled market share to the iPhone and Android phones, Lazaridis and Balsillie spent more and more time setting up their own non-profits and trying to buy an NHL franchise. As their company grew and became more complex, their management style never evolved, and they remained married to their preference for consensual decision-making. When their COO retired, their overconfidence led them to take an even greater role in running the company. All this led to a dysfunctional organization where there were no clear divisions of responsibility, individuals weren’t empowered, communication was stifled, and accountability was severely lacking.

The organizational inefficiencies outlined above played a major role in the company’s inability to launch successful new products in a timely fashion. Overly aggressive deadlines were ignored, conflicting views led to unfocused products, and miscalculations about resource deployment and strategy cost valuable time and money and...