Lords of the RIM

Research In Motion has shied away from a chance for a reboot. The troubled BlackBerry maker’s architects, Mike Lazaridis and Jim Balsillie, are finally giving up their shared CEO job. And, the company has appointed a new board chair. But, Thorsten Heins, the new boss, is an insider who sees no need for drastic change, and the two ex-CEOs will stay on the board.

RIM is in serious trouble. Only six per cent of new US smartphone users bought a BlackBerry in the fourth quarter of 2011, according to Nielsen. Most customers prefer phones from Apple or those running Google’s Android operating system. The company has lost 75 per cent of its market value in the last year. The firm has made a habit of missing optimistic sales predictions and product introduction deadlines. Also, phones running its newest operating system won’t be available until the second half of this year.

Heins will focus on improving execution and marketing — both can make, at least, some difference. He argues RIM is a growing company with a few challenges. Unfortunately, sales in recent periods have been shrinking compared with the year before. Meanwhile, Android devices and the iPhone are becoming further entrenched. Heins, like his former bosses, doesn’t seem willing to fess up to RIM problems’ severity.

With the new CEO dismissing a sale or breakup of the company, a turnaround will depend on developing hit new products – and pronto. But, the management reshuffle may have made RIM even harder to steer in a new direction. Lazaridis and Balsillie, who together own more than 10 per cent of the stock, will still be involved. And Lazaridis, having failed to keep pace with rivals’ advances while jointly in charge, will head the board’s new innovation committee.

RIM is billing the changes as a succession plan recommended by the outgoing co-CEOs rather than even hinting at the increasing, and justified, shareholder clamor for change. Yet, the company is falling further behind its rivals daily. Heins might or might not be capable of engineering a turnaround, but it doesn’t look like he’ll get the chance. The reshuffle could hardly be further from a fresh start.