Research in Motion – Managing Explosive Growth Essay Example
Research in Motion – Managing Explosive Growth Essay Example

Research in Motion – Managing Explosive Growth Essay Example

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  • Pages: 5 (1152 words)
  • Published: September 19, 2018
  • Type: Essay
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Research in Motion (RIM) is facing a crucial moment in its global expansion strategy in January 2008. The company's main challenge is to sustain the growth of previous years and continue expanding globally through innovative practices. Despite significantly increasing expenditure over the past four years, the expenditure-to-sales ratio has been cut in half.

RIM is not effectively utilizing its rapid growth to enhance its technological innovations, which are crucial for sustainable revenue growth in the mobile communication industry. This industry is highly competitive and characterized by an oligopolistic market structure. Assessing RIM using Porter's five forces model reveals several threats, with the biggest being the Threat of Rivalry.

RIM's direct competitors have a larger market share globally and they are investing more heavily (both in absolute terms and as a percentage of sales) in t


heir activities compared to RIM. They are also aiming to transform the industry into a network industry by collaborating on Mobile OS (such as Symbian) among different companies. Some of these competitors have already expanded their presence worldwide to attract skilled workers in emerging countries, a concept that RIM is considering. RIM's Blackberry products possess a temporary competitive advantage as they were initially designed as smartphones for busy professionals.

RIM is currently attempting to enter the consumer market, which is presently controlled by other companies. Additionally, RIM's rivals have effectively introduced similar convergence products in this specific market segment. As a result, this presents a noteworthy threat referred to as the Threat of Substitutes. RIM's primary competitors in the smartphone industry consist of Palm Treo, Sony Ericsson P900, Nokia E62, Motorola Q, and Apple iPhone. In fact, Apple aim

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to convince corporate users to choose iPhone as their favored converged device.

A significant issue faced by RIM is the existence of imitations, such as China Unicom's Redberry mobile email service. Additionally, RIM is encountering challenges in terms of the availability of skilled engineers - a threat known as the Threat of Suppliers. The scarcity of exceptional software engineers, particularly in Waterloo, is impeding RIM's growth plans and hindering its geography strategy of limiting platform development in its Canadian headquarters. Neglecting to address this threat of suppliers could potentially amplify RIM's other threats, including rivalry and substitutes.

The mobile communications industry, although existing for over twenty years, is still considered an emerging industry. Evaluating the environmental opportunities for RIM, it is important to note that smartphone sales are projected to exceed 1 billion by 2012. RIM's leadership in Blackberry sales provides them with a first-mover advantage. RIM has successfully capitalized on this temporary competitive advantage through the development of secure push email technology. They have sustained this advantage by fostering an adhocracy and clan-based organizational culture and facilities.

RIM's spending on has been steadily increasing, but not sufficiently, which is crucial for sustainable growth. The best way to categorize the mobile communications industry into strategic groups is by market segments. These segments comprise smartphones for business, smartphones for consumers, multimedia mobiles, stylish mobiles, basic mobiles, and more. RIM's Blackberry targets the market segment of smartphones for business and has been recognized with numerous innovation awards. This represents RIM's strategic position based on variety.

RIM's competitors also have a plethora of unique products, but RIM's technological leadership may decline and become unsustainable, which is vital for

the company. When evaluating RIM using the VRIO model, I believe that its engineers and organizational culture are its most valuable assets. These resources have been providing a long-lasting competitive advantage thus far. However, both of these resources are now at risk due to a shortage in supply. In order to enhance RIM's research and development activities, the company needs to expand its workforce for developing core platforms because resources are depleting at its headquarters in Waterloo.

To achieve growth, the company can expand its operations globally and recruit engineers from emerging countries, which offer a vast talent pool. Acquiring other companies will not greatly improve its capabilities. The company's valuable assets include its push-email architecture, unique product Blackberry, source code, and patents. These resources give it a temporary competitive edge in the mobile communication industry but can be copied, making them susceptible to alternatives.

The risk becomes greater if RIM decides to expand its operations worldwide.

  • platform development in India is problematic because of the high turnover rate;
  • and it's risky in China because Chinese government regulations require RIM to compromise RIM's security features.

The potential loss of advantages in social complexity in Waterloo could be a challenge for RIM. The dilemma they face is whether to globalize platform development or not. One solution is to carefully plan their geography strategy, utilizing global talent pools to mitigate threats and counter the threat of rivalry.

The drawbacks of globalization include management overhead, legal issues, and organizational challenges associated with a cultural shift. RIM has limited options to address these concerns. One option is to enhance the development of

local talent in Waterloo and keep platform development there. Another possibility is to follow Nokia's approach of expanding research efforts in countries outside of Canada. However, RIM's demand for human resources exceeds the current supply in Waterloo and it would take time to fully develop this alternative.

unified version: Apart from the mentioned alternatives, another approach that can be adopted is to expand the platform development business within Canada itself. This can be achieved by setting up new development centers in cities like Toronto, Montreal, and others. By doing so, the company can avail several advantages such as accessing fresh supply sources and avoiding difficulties related to higher management overheads, legal complexities, government interactions, and cultural adjustments. Considering these factors, I recommend contemplating on the third option.

RIM can partner with the University of Toronto and McGill University to access high-quality talent through their co-op programs. Additionally, RIM can establish a global scouting program to attract engineers from around the world to Canada. This opportunity is appealing to new hires due to Canada's good living standards and the government's lenient immigration policies. Furthermore, this solution addresses the issue of limited physical space on the Waterloo campus. The main benefit of this strategy is that it helps mitigate the risk of substitute products.

Moreover, RIM would not have to handle the policies of foreign governments, as the company's source code would be securely protected under established patent and copyright laws in Canada. Additionally, the management and logistical burdens associated with platform development would be reduced. However, adapting to a new global diversity at RIM would still require a cultural and mindset change. Despite this, RIM

could still move forward with opening other lines of business in emerging economies. Such a move would transform RIM from a multinational into a global company, enabling it to tap into talent pools worldwide and significantly accelerate much-needed research and development activities.

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