RIM to cut 40% of workforce as another top exec resigns
As ailing Research in Motion prepares to axe nearly 40 percent of its workforce in the coming months, another top-level executive has announced their resignation on Monday as the BlackBerry maker continues to hemorrhage cash.
Canada-based RIM lost its top lawyer on Monday when Chief Legal Officer Karima Bawa announced she would resign, with her departure adding to the rising count of high-level executives leaving the company, reports Reuters.
Bawa's resignation is the second in as many weeks and follows that of Managing Director of Global Sales and Regional Marketing Patrick Spence. In early April, it seemed that Spence would be staying, but the situation at RIM was apparently too dire for him to remain.
A statement from RIM noted that Bawa, who has worked for the company since 2000, would be staying on long enough to hire and transition a suitable replacement.
The Waterloo, Ontario company is expected to cut a massive number of jobs through the year in tandem with launching new handsets built around the next-generation BlackBerry 10 operating system. According to sources familiar with the matter, RIM is looking to bring down its existing global workforce of 16,500 employees to about 10,000 by early next year. The layoffs will affect the company's legal, marketing, sales, operations, and human resources divisions, a source said.
CEO Thorsten Heins, who replaced co-CEOs Mike Lazaridis and Jim Balsillie in January, is looking to salvage what is left of the once dominant smartphone maker and part of that change necessitates the huge layoffs.
RIM headquarters in Waterloo, Ontario. | Source: The Globe and Mail
RIM stock has plummeted some 75 percent over the past year as its share of the smartphone market dwindles against heavy competition from Apple's iPhone and handsets running Google's Android. According to the latest IDC data, BlackBerry shipments only accounted for 6.4 percent of the global market while Android and iOS took a combined 82 percent, shipping 89.9 million and 35.1 million units, respectively.
Canada-based RIM lost its top lawyer on Monday when Chief Legal Officer Karima Bawa announced she would resign, with her departure adding to the rising count of high-level executives leaving the company, reports Reuters.
Bawa's resignation is the second in as many weeks and follows that of Managing Director of Global Sales and Regional Marketing Patrick Spence. In early April, it seemed that Spence would be staying, but the situation at RIM was apparently too dire for him to remain.
A statement from RIM noted that Bawa, who has worked for the company since 2000, would be staying on long enough to hire and transition a suitable replacement.
The Waterloo, Ontario company is expected to cut a massive number of jobs through the year in tandem with launching new handsets built around the next-generation BlackBerry 10 operating system. According to sources familiar with the matter, RIM is looking to bring down its existing global workforce of 16,500 employees to about 10,000 by early next year. The layoffs will affect the company's legal, marketing, sales, operations, and human resources divisions, a source said.
CEO Thorsten Heins, who replaced co-CEOs Mike Lazaridis and Jim Balsillie in January, is looking to salvage what is left of the once dominant smartphone maker and part of that change necessitates the huge layoffs.
RIM headquarters in Waterloo, Ontario. | Source: The Globe and Mail
RIM stock has plummeted some 75 percent over the past year as its share of the smartphone market dwindles against heavy competition from Apple's iPhone and handsets running Google's Android. According to the latest IDC data, BlackBerry shipments only accounted for 6.4 percent of the global market while Android and iOS took a combined 82 percent, shipping 89.9 million and 35.1 million units, respectively.
Comments
Quote:
Originally Posted by Tallest Skil
I'm sure all the people recently out of a job will appreciate your wonderful post. Companies falling like this is never a good thing and does nothing to make the industry better.
Failure is an absolutely natural outcome for any company out there; in fact, the principle of limited corporate life is at the core of any basic economics and/or law course at university level.
RIM fell because of mismanagement, lack of innovation and overall lax behavior, where they presumed that their extremely comfortable position in business telephony would continue forever (just like Nokia in the consumer segment).
Alas, in a world of (almost) unrestricted competition, it is more than obvious that some shall suffer while others thrive. Remember Apple in the late 90s? I do; absolutely every single media outlet out there proclaimed them dead - only to see the company come back with a vengeance. As for the now-unemployed people, I am sure most of them will be able to find a better job elsewhere (if they are qualified, bien sûr) - maybe not in Canada (a place not widely known for innovation, let's be clear); but most labor markets are global nowadays anyway.
So were the COCOCEOs keeping the company afloat, or have we not given them enough time?
If RIM pulls a rabbit, I will eat my hat.
I have a jelly hat. Just in case.
It's a sad thing to be sure, but the title does seem appropriate. RIM had a fast rise, and now it's undergoing a fast fall. It had a half decade of pretty good fortune in between.
Quote:
Originally Posted by fredaroony
Companies falling like this is never a good thing and does nothing to make the industry better.
Anyone with talent will get a job at a different company, where their talent will actually be realized.
Anyone else finds a different job outside the industry.
It's a win-win.
There is a shortage of skilled software developers in Canada right now. Any one with decent skills are being snapped up quickly. My employer has been interviewing for weeks, and all of the good candidates are sitting on a few offers by the time they see us. RIM does have a lot of good talent, I wouldn't be worried about those with useable skills.
Actually companies failing like this are a very good thing. You can't concern yourself with the employees, finding work is their business. Just imagine how much better off the world would be if GM and Chrysler had gone under. We might actually have business in Detroit innovating with respect to transportation. Instead we have the same old corporations invested with bad unions and zero innovation.
Your perspective here is totally screwed, this is exactly what business needs right now. It effectively frees up a great deal of talent that has be squandered by RIM and allows that talent to seed innovation elsewhere. Frankly you need to research your position a bit.
Another gleeful rim demise news item...not good for the posters karma...
Quote:
Originally Posted by wizard69
Your perspective here is totally screwed, this is exactly what business needs right now. It effectively frees up a great deal of talent that has be squandered by RIM and allows that talent to seed innovation elsewhere. Frankly you need to research your position a bit.
lol ok, thanks for your input. Competitors leaving the market is a great thing...can't believe I never saw it before!! Thanks for teaching me
The proven with "C" level executives is that most of them are just barely competent at that level. It's called the "Peter Principle", where people are promoted one level higher than their level of competence.
When times are good, almost all but the most incompetent can run a company. But when times are bad, that's no longer the case. This is true for most every field.
With RIM, we saw two guys who had flashes of brilliance, but who weren't capable of seeing past what they believed. When something came along that was better, they thought it wasn't possible. Nokia had the same problem. Both companies are in trouble.
The real question now for RIM is whether anything can get them out of this as an independent company functioning in the same business. I don't think it can.
Quote:
Originally Posted by fredaroony
lol ok, thanks for your input. Competitors leaving the market is a great thing...
Here's an existential musing for you: If no one's buying their crap, can they really be considered a competitor?
Wanting companies to linger that are not competitive is what does nothing to make the industry better. Letting things evolve and change naturally as consumer interests change and companies learn to out innovate their competitors is what makes industries better.
The problem is that often when a large iconic business files, nothing rises up to take its place in that same local. There is no guarantee that if RIM fails, as it looks likely, that something else will replace it. Most likely, nothing will.
Quote:
Originally Posted by Tallest Skil
Here's an existential musing for you: If no one's buying their crap, can they really be considered a competitor?
You forget that Apple nearly went bankrupt as well?
Quote:
Originally Posted by SolipsismX
Wanting companies to linger that are not competitive is what does nothing to make the industry better. Letting things evolve and change naturally as consumer interests change and companies learn to out innovate their competitors is what makes industries better.
If they had the right management it's possible they can still bring themselves back just like Apple once did.
Quote:
Originally Posted by fredaroony
You forget that Apple nearly went bankrupt as well?
Having what to do with anything? If RIM has some magical man to come swooping back in and save the company from what appears to be certain doom, more power to them. If they can actually create stuff people want to buy after that point, more power to them.
As it stands, they'll NEED that miracle.
It's a bad thing for the local economy. But it's not a bad thing for the industry. So we will have RIM leaving, and possibly Nokia, Sony and Motorola. It seems bad, but we've got new competitors such as Apple, Google, ZTE, Huwai and others that have come in. It's really just the changing of the guard, so to speak.
Quote:
Originally Posted by fredaroony
I'm sure all the people recently out of a job will appreciate your wonderful post. Companies falling like this is never a good thing and does nothing to make the industry better.
Screw them. That's how the business world works. The strong survive and the weak die. And not only is RIM weak, but they are also arrogant and stupid.
Amateur hour is truly over.
The operant term here is "nearly went bankrupt". If SJ hadn't come back with Next, they MAY have gone bankrupt, but they didn't. Can we point to anyone, and to ant product that will turn this around, given the rapid deterioration of their market? Apple was never in that position.