You have to hand it to Nintendo’s executive team. They step up to their responsibilities and accept blame like men. Nintendo president Satoru Iwata recently addressed shareholders about the company’s decision to slash the price of its Nintendo 3DS handheld system. He acknowledged the failure, accepted the blame, and said that he would slash his salary in half. He also noted that other executives would be hit with a 20- to 30-percent salary cut.
Iwata’s actions are very Japanese and very Eastern. By Western standards, it seems unusual. A high-ranking executive admitting fault?!? That’s crazy (think Brian Fellow)!!! The whole thing reminded me of another company that has made several mistakes, but continually refuses to acknowledge them in a meaningful way. I’m talking about Research in Motion (RIM), makers of the once-dominant BlackBerry smartphones.
Once upon a time, RIM was the dominant name in smartphones. It offered — and still offers — some of the best emailing and security options on a mobile phone. However, the smartphone landscape has drastically changed thanks to the iPhone. Whether it’s for work or play, many users prefer Apple iOS and Google Android over BlackBerry for their superior multimedia capabilities. Web browsing, watching movies, listening to music, playing games, and performing big-screen work is simply better on Android or iOS than on BlackBerry OS.
RIM’s executive team has failed to quickly adapt to the dramatic changes in the smartphone space. It still offers phones with great call quality and excellent keyboards. It still offers superior email and security. Unfortunately, that’s not enough these days. The company has pinned its future on QNX, but has been comically slow to implement modern QNX features into BlackBerry OS. RIM claimed that it would make a big splash with the BlackBerry PlayBook. Instead it released a half-baked product that’s a joke compared to the Apple iPad.
Despite its glacial pace of evolution and numerous failures, RIM’s execs haven’t admitted failure the way that Iwata has. Part of the problem is that nobody is sure which CEO to blame. Another part of the problem is that having two CEOs is a galactically stupid idea. It’s also a cultural thing. RIM is a Western company with a Western culture. I don’t expect RIM CEOs Mike Lazaridis and Jim Balsillie to publicly cut off their pinkies (metaphorically) the way that Iwata did. That said, they probably should. The 3DS launch was arguably Nintendo’s biggest mistake in the last decade, yet Iwata immediately stepped up and accepted responsibility. RIM has been flailing around for years and nobody is stepping up.
Ultimately I see one company that has made a mistake and will most likely succeed again, partially because of its executives. I also see another company that has made mistakes and will most likely never be as successful as it once was, partially because of its executives. I found the contrast amusing and wanted to share it with all of you. I’d also love to hear your thoughts on Nintendo and RIM. What do you make of their executives’ behavior? What kind of success will each company have in the future? Leave a comment and let me know (please)!
I disagree about the 2 CEO thing. Otherwise, yeah they failed to adapt.
RIM employees think it's stupid to have two CEOs.
RIM employees are going to feel the brunt of this situation. The employees of Freeport McMoRan are quite happy with their dual CEO set up. Just saying, not all are bad, but when they BOTH decide to rest on their laurels it's a serious situation.
Of course not all are bad, but it's generally a stupid idea. Show me a tech or media company that was better off with two CEOs.
I just named a company that sits in the Fortune 500. I don't need a tech or media company to disagree that two CEOs can't work.
I will research and see if there is one thougn.
Again, that's just one example. That's an exception. Furthermore, it's a very old and very different type of business. An example in tech or media would be much more relevant.
Then you should have been more clear instead of calling it a "galactically stupid idea". Perhaps RIM is the exception?
Show me examples other than RIM where it didn't work out. Granted I'm of the belief that one CEO with one clear direction is preferable, I won't deny the strategies that have proven to be relevant and useful in business.
And no, I do not think a tech or media company is more relevant to this discussion. Big business is big business in the end.
But since you asked, SAP uses a Co-CEO system. It's rare in public companies.
SAP's CEOs are in charge of different portions of the company and those are clearly stated. That's a different situation than RIM, where the responsibilities and duties are far more nebulous.
I maintain that it's a generally stupid practice and there's a reason why it's uncommon.
Ray, an LLC or LLP is ran by more than one person. A corporation by definition is ran by many people but someone like a CEO is elected. I really think you are splitting hairs on this issue as are most bloggers. It's not that big of an issue. You want to blame their mgmt structure? Blame the board.
If we exclude the mega movers of big business like Buffett, Gates, etc then we have shared power structures. CEO and Chairman of the board is a fine line. Hell, CFO and CEO is a fine line. I think too much is being put into the titles.
Not splitting hairs at all. RIM has exhibited poor leadership and part of the reason for that is how it's structured. Employees don't known who's in charge of what and who is really steering the ship.
Bringing it back to the context of the article, Iwata's clearly in charge of Nintendo. He's taking the biggest salary cut and putting himself out there as a target. He's owning the situation and taking steps tonget past it. Compare that to RIM's leadership.
I agree that RIM's leadership really screwed the pooch nor are they owning up to mistakes made in the market. I never disagreed with that point.
RIM's issue is a failure of not only their top tier leadership but their entire board.
Only uncommon in public traded corps. Otherwise it's not so rare.
Hey- sorry to bust in and go all off-topic, but I just saw this over on woot.com- http://deals.woot.com/deals/details/636f2dfd-a03c…
You can pre-order the PS3 'official' headset on Amazon for $65. Don't know if anyone's interested, but I thought I'd throw it out there.
This article is pure foolishness. Stapling RIM to every tech problem experienced in the industry is ridiculous. Futhermore, this author has their facts wrong
What facts are wrong? What has RIM done well in the last three years?
For starters, what does RIM even have to do with Nintendo?
Let's ignore that ridiculous association for a moment. Saying that RIM has "been comically slow to implement modern QNX features into BlackBerry OS" is grossly inaccurate. QNX was integrated into the PlayBook less than a year after acquisition. Apple took years to make and release the iPad. Steve Jobs said that he was working on it before the iPhone, which was released in 2007 and was in development a for years before that.
What has RIM done well in the last three years? That statement alone tells me that instead of doing your homework, you've chosen to jump on the bandwagon of RIM-bashing media acolytes. How about BBM? Keyboards? Battery life? Network efficiency? Security? Success in developing markets? Beating Android/iPhone until late last year? Acquisition of QNX? Acquisition of Gist? Acquisition of TAT? Call quality? Subscriber increases? Wireless conferences? Increased patent portfolio? Joint Office venture with Microsoft? Top phone in the enterprise? Only tablet certified for use by US Government? BlackBerry Enterprise Server? Smart Card Readers? Carrier billing for apps? Multiple SDK's for various develiper segments? NFC security work with international vendors? Android runtime integration? BlackBerry Protect? BlackBerry Travel? BBM Music? AI implementation (WikiTude)?
Do some homework before bashing RIM/BlackBerry!!!
For starters, I was comparing the company executives, not the companies themselves.
Secondly, I've been covering RIM for more than a decade, so I'm familiar with what the company offers. The QNX statement is perfectly accurate. The company has needed a modern OS for years. Its losing ground to Android and iOS because of this. More and more companies are moving away from BlackBerry OS and moving to iOS. Just look at all the iOS adoption among the Fortune 500.
A lot of the things you say RIM has done well in the last three years are things that aren't new. The company isn't progressing. It's clearly declining. You point to all these things that don't convince me of RIM's leadership at all. Why don't you keep it simple? RIM's products are behind the competition. BlackBerry OS market share has been going down for years. RIM's stock price is a fraction of what it used to be. RIM's profits are down. The BlackBerry PlayBook was a completely flop.
Lastly, you really need to understand that I'm not bashing BlackBerry at all. I'm bashing RIM's leadership. I understand if you're a BlackBerry fan, but I don't see how you can support RIM's leadership.
RIM is losing ground. That's obvious. It's mostly in the US, where all of the negative American analysts, bloggers and malcontents are aggregated. Shocking. They're taking on two of the biggest companies in the world, in Apple and Google. Throw in Microsoft and that makes three. Any company would probably be losing ground in this scenario. Your QNX statement is actually inaccurate. The OS that you are characterizing as dated was more advanced under the hood than either iOS or Android for a number of years and in many ways, it still is. I feel that you are wrongfully using the term 'OS' interchangeably with the term 'UI'. The mechanics of how the OS works are quite sound but the UI needed more refreshing and appeal than it has received. The OS had true multitasking, advanced security and other things that were better than its contemporaries. One other thing that Apple/Google haven't had to deal with is a back-end network infrastructure that the client phones need to be built to run on. This surely impedes the speed of some work, as it is a consideration during development and certain things cannot be implemented unless the back-end is ready.
The tech industry is very trendy. RIM is hardly the only technology that people are sizing up and replacing to some extent. Part of the problem is clearly RIM and part of it is bloggers and opinionated goofs who write constant, negative drivel about RIM, just because it's a popular thing to do. Have you counted Google's failures in the last few years? Have you any recollection of what Apple went through before it came storming back? Have you even used a PlayBook? It is a great tablet. Sure it needed some stronger software but it will get it. I don't view it as a flop. You will though because that is what all of you are conditioned to believe; the iPad is a juggernaut and anything else is inferior. When the iPad came out, it had no camera and no Flash. The PlayBook has both. The iPad did not have true multi-tasking, the PlayBook does. The iPad didn't have HDMI, the PlayBook does. The PlayBook launched with wireless software updates, the iPad did not…but you will continue to bash RIM and do so under the pretense that you are criticizing RIM's leadership.
You're doing a ton of projecting. There's no pretense or trendiness involved. RIM has been slow to adapt and leadership has been poor. There's no denying that. Thinking otherwise is just being a fanboy.
RIM is losing ground in Europe and North America. It's doing well in third-world countries because of its modest data requirements. In countries just deploying 3G, BlackBerry makes sense. For countries with high-speed mobile, it's awful.
I used the PlayBook for a few weeks. It is not a great tablet. It's delusional say otherwise. The OS is incomplete, there's no incentive to develop for it, and it sold poorly. It's absolutely a flop. Look at the hit RIM took last quarter due to unsold PlayBooks.
Not sure why you think I have an agenda. That's a silly accusation. I'm a former BlackBerry user and would like to see the company do well. The reality that you're denying is that RIM's leadership shouldn't be criticized. That's ridiculous. Again, look at the profits, installed base, and stock price. Everything is headed down and there's no signs that the CEOs will turn it around. You say that it's irrational RIM bashing, but it's reality. The company is falling behind further and further every day, but there's no accountability for it.
You need to separate your fandom of BlackBerry and your views on RIM. There's n way a rational person can say the PlayBook wasn't a flop and that RIM's CEOs are doing a good job.
If you don't think the PlayBook is a great tablet, that's your prerogative…but many people think otherwise. The iPad and other tablets are not for everyone either…but what it does well, it does extremely well. For example, it handles multimedia files and file transfers better than any other tablet that I have (and I have an iPad, TouchPad and Galaxy Tab). Dismissing me as a fanboy only makes you look small. I'm actually a dev and user on three of the top platforms. I simply don't have the same anti-RIM bias that you do. There is lots of incentive to write for the PlayBook. You don't know what you're talking about. It supports multiple frameworks (unlike other tablets), Android apps can be run on it with minimal modification, the BlackBerry AppWorld is documented to make the average dev more money for their apps, etc.
You're rationalizing about why RIM is doing well in developing markets and I don't really disagree there but an additional point is that the markets that RIM is doing well in are also extremely populous. Many of these markets, counted in aggregate, dwarf the US market. My BlackBerry, here in North America, routinely beats my peer's iPhones and Android devices at opening web pages, making reliable calls and doing other routine tasks. You are propagating fairy tales, or at least, generalizing about the experience in a way that is not accurate. One of the most pronounced issues that RIM is facing is that the growth of the market is outpacing their growth and to try to keep selling briskly, they've slashed what they make per device. Their subscriber base is actually up but they are not making the money on each unit that they used to. As far as the PlayBook, I feel like negative tech bloggers really influenced the sales of the device. It has sold more than much of the other tablet competition, save for the iPad but let's just ignore that fact?
Did I say that RIM's leadership shouldn't be criticized? Every leader should be open to criticism; being judged is part of the job. I said that RIM's situation has nothing to do with Nintendo. The fact is that you made that association because it fit into the gaming 'box' that you are familiar with. In reality, the comparison was very weak and inappropriate. It does nothing but cry out for hits.
Debating with bloggers with the anti-RIM gene mutation is pointless. You will never admit that RIM has done anything well because it won't get you hits in the current climate. It's too popular to be anti-RIM. Being insulting and overly negative to your readers is what your preference is,
There is a some strength in RIM's financials, if you bother to pay attention but you won't. Keep adding on to the anti-RIM narrative with your petulant attitude. Can't wait for your insightful comparison between RIM and Double Dragon or RIM and Atari! That will grab hits!
I really don't understand why you think I have it out for RIM. It's tremendously amusing. You're accusing me of all sorts of things based off of one article. If you've read my work over the years then you'd see I've had plenty of positive things to say about RIM. Your accusations are baseless and dumb.
As for the gaming box I'm familiar with, that's also a dumb assumption. I've been covering tech longer than I've been writing about games. Try again.
Sticking up for the PlayBook is really just funny. You say it's not a flop, but it was critically panned and didn't sell. RIM took a $485-million loss in unsold PlayBooks. That's not a flop?
RIM's profits are down. Again. The stock is around 14, down from a year high of around 70. Tell me some of the positives about the latest financial report.
You seem similar to RIM in that you can't admit a problem and are accusing others of being biased. And really, that's why I made the Nintendo comparison. Nintendo admits its faults. RIM does not.
I'm drawing these conclusions about you because of multiple reasons, including the language that you're using for your blog title, its inaccurate contents and your refusal to admit that RIM has done anything good in the past three years. These are the blueprints for RIM-bashing. My accusations are spot-on. I don't care how long you've been covering tech versus gaming; my point was that you made the Nintendo association because the gaming parallel is one that you understand. You need some reading comprehension skill.
You are either lying about the PlayBook or are grossly uninformed. It had sold about 750,000 units before being discounted and the write-off that RIM did was to cover off the discounts per unit that they were planning to do, not simply a number representing unsold PlayBooks. The truth is that only a small collection of tablets sold a lot of units and out of those, the PlayBook is included. The TouchPad hardly sold any units until it was discounted but I'm counting it, as the final sales for the year were over 900 million units. Amazon claims to have sold one million Kindle Fires a week since launch. If you've done your research, you'd know that the Kindle Fire is essential a PlayBook with less hardware features but a customized Android experience that taps into Amazon services. The PlayBook was never criticized for being a technical flop; most critics felt that it was missing an email client and some key software upgrades…so when it gets them in a number of weeks, how is the device a flop? The pricing of the device was wrong and adjusting it resulted in MASSIVE sales and customers ran out to get them in droves, causing sell-outs across the continent. If the PlayBook were an album, it would be certified platinum. How is that a flop? Flops don't sell at all. The PlayBook sold 3/4 of a million before any discounts and quite a lot of units afterwards. People don't buy flops, they buy things at the price that they want. A flop is something that no one wants or is willing to pay for, even at a discounted price. You must be using your own definition of flop that suits you. BGR called the PlayBook its favourite tablet: http://www.bgr.com/2011/07/07/the-blackberry-play…
You keep ignoring facts because they do not fit into your anti-RIM narrative. Let me do your homework for you, again…since you say that you want to see any positives out of RIM's latest results:
* RIM made revenue of $5.2 billion, up 24% from last quarter
* BlackBerry smartphone shipments of 14.1 million, up 33% from Q2
* GAAP net income of $265 million or $0.51 per share diluted; adjusted net income of $667
million or $1.27 per share diluted (more than Analysts expected)
* BlackBerry subscribers up 35% year-over-year to almost 75 million
* Cash flow from operations of approximately $895 million
* Total of cash, cash equivalents, short-term and long-term investments of $1.5 billion
Is RIM hurt after a hard year? Absolutely. If you can't read the above info and comprehend that there was still some positive development in the results, you are proving my point that you are an anti-RIM flamethrower with an unknown motive.
I stated multiple times that RIM needs to recover from some things and that the market growth is outpacing theirs. Everyone understands that RIM needed to transition to better software. I'm not sure why you're ignoring those admissions in favour of ones that fit your line of reasoning. The truth is that you don't know as much about RIM's situation as you think that you do. You are the equivalent of a sports fan who watches game highlights on ESPN and believes that this authorizes them to critique the entire game, even though they haven't watched it.
Not lying about anything. I used it. It has some great features, but it's also incomplete.
Also not refusing to admit RIM did anything right over the last three years. I'm saying the company did a lot more wrong. If anything, you're the one that one admit its flaws.
You need to learn the difference between shipped and sold. If you're impressed with with 850,000 units — your number is wrong btw — then I don't know what to tell you. That's a pathetic number.
You also don't know how to analyze numbers. Why would compare revenue quarter to quarter? That makes no sense. Look at the year-to-year profit. It's down. You can't deny math.
Again, RIM is losing share in North America and Europe. Those markets set the trend for the future. I told you before that RIM is doing well in third-world countries (see what I did there, I said RIM did something good), but you even took that as an perceived insult to RIM.
Also, if you don't care about my history covering the market then why should I care about your perspective as a developer?
Anyway, it looks like we won't agree on this. I maintain that RIM's leadership, particularly its two CEOs, are doing a bad job. You've done nothing to convince me that they will help the company recover.
Aside from your petty insults, this was a fun discussion. Thanks for the traffic.