RIM under fire: company reviewing future of co-CEOs as employee criticism circulates
Except for perhaps a complete collapse of its share value or meteor striking its headquarters, Research in Motion couldn't have had a more troubling day. An anonymous executive released a scathing letter, while the Waterloo, Ontario-based company made concessions to stave off an investor revolt.
NEI Investments had planned to make a proposal during RIM's annual General Meeting for shareholders that would have separated the company's leadership, if adopted. Right now, RIM has co-CEOs, who have come under fire as the BlackBerry platform burns beneath them. From NEI's perspective perhaps, two heads aren't better than one. Shareholders could have separated the roles of CEO and chairman and set up an independent chair. Today, RIM agreed to establish an independent committee for realigning top leadership, and NEI withdrew its proposal planned for the July 12 meeting.
But the process will be surprisingly slow, and may cause as much controversy during the General Meeting as RIM seeks to prevent. The committee's report isn't due until Jan. 13, 2012. RIM needs relief now.
How badly can be seen in the anonymous RIM executive's letter that ignited the InterWebs with chatter and criticism today. The letter, addressed to "RIM senior management team" begins solemnly: "I have lost confidence. While I hide it at work, my passion has been sapped. I know I am not alone -- the sentiment is widespread and it includes people within your own teams".
The employee then goes on to make eight observations/recommendations about what's wrong with RIM and what's needed to fix it. The anonymous employee writes:
About accountability: "RIM has a lot of people who underperform but still stay in their roles. No one is accountable. Where is the guy responsible for the 9530 software? Still with us, still running some important software initiative. We will never achieve excellence with this culture".
About apps: "We urgently need to invest like we never have before in becoming developer friendly. The return will be worth every cent. There is no polite way to say this, but it's true -- BlackBerry smartphone apps suck. Even PlayBook, with all its glorious power, looks like a Fisher Price toy with its Adobe AIR/Flash apps".
About marketing: "25 million iPad users don't care that it doesn't have Flash or true multitasking, so why make that a focus in our campaigns? I'll answer that for you: it's because that's all that differentiates our products and its lazy marketing. I've never seen someone buy product B because it has something product A doesn't have. People buy product B because they want and lust after product B".
About Apple: "They have people lining up overnight at stores around the world, and products sold out for months. These people aren't hypnotized zombies, they simply love beautifully designed products that are user centric and work how they are supposed to work".
Not surprisingly, RIM management responded:
It is obviously difficult to address anonymous commentary and it is particularly difficult to believe that a 'high level employee' in good standing with the company would choose to anonymously publish a letter on the web rather than engage their fellow executives in a constructive manner, but regardless of whether the letter is real, fake, exaggerated or written with ulterior motivations, it is fair to say that the senior management team at RIM is nonetheless fully aware of and aggressively addressing both the company's challenges and its opportunities.
RIM's problems are no secret. Shares have fallen from around $70 in mid February, closing at $28.85 today. PlayBook suffered repeated delays. BlackBerry phone has plummeted, as Android handsets and iPhone market share increases. For example, according the Nielsen, only 6 percent of new smartphone acquires bought BlackBerries between March and May, down from 11 percent during the previous three-month period.