BLACKBERRY DOWNFALL

ASSIGNMENT 3
TOPIC : BLACKBERRY DOWNFALL

Submitted by : Ashhad Zeeshan Saqlain

Roll No : 15-ME-057
Section : A
Submitted to : Sir Shahbaz Naqvi

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Table of Contents
Introduction .................................................................................................................................................. 3
DOOM of BlackBerry (Manshor, 2015) ......................................................................................................... 4
Trends: (Ashwin, 2016) ............................................................................................................................. 4
Weaknesses: (Manshor, 2015).................................................................................................................. 4
Threats: (Manshor, 2015) ......................................................................................................................... 5
Innovative Competition and Cyclic Adaption Misalignment: (Moussi) .................................................... 5
Managerial Effect on Adaptive Cycle: (Moussi) ........................................................................................ 6
Stock Crashing: (Ciaccia, 2013) ................................................................................................................. 6
Conclusion: .................................................................................................................................................... 7
Works Cited ................................................................................................................................................... 8

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BLACKBERRY DOWNFALL
Introduction
A company named “Research in Motion” was founded back in 1984 which were given a new
name of “Blackberry” later. It specialized in designing complex data communication networks
for military, police forces etc. Due to rapid growth, they started developing personal
communicators. RIM launched their first handheld device in 1996 and continuously making
innovations after that. Blackberry devices having corporate email systems were launched by
RIM in 1999.As a result, blackberry got iconic in communication industry .They also introduced
BBM (Blackberry messenger service) having highly secured protocol. Following these successes,
Blackberry marked itself as the most valuable company of Canada having worth of 67 Billion
dollars and 10 million subscribers to their services and launched BLACK BERRY Curve devices in
2007.

But, unfortunately in 2007, Apple also launched IPhone. From that moment, BLACK BERRY
started its period of decline and failed products which eventually led to great loss of market
share and value. Following figure shows the decline of market share of BLACK BERRY in smart
phone sales of Verizon.

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Fig 1 (Moussi)

DOOM of BlackBerry (Manshor, 2015)

 They didn’t foresee the revolution of smartphones.
 App Economy emerged, as a result of which Blackberry was blindsided due to high
adoption of iPhone and android software based devices by masses.
 Blackberry failed to expect that there would be significant change in smartphones
industry.
 Changing consumer needs were not met or responded by the company.
 Launch of devices having touchscreen was very late by BLACK BERRY; also it was inferior
than Apple or Samsung devices.
 While BLACK BERRY was proud of its highly secured and email enabled mobile devices,
Google and Apple were busy working on powerful mobile computers having user
friendly web browsing and email systems.
 Slow to react to market changes.
 Bad designs and bizzare names.
 Corporate slow down.
 Apple and android exploded in the new era of touch screen and big screen technology.

Trends: (Ashwin, 2016)

 There were many trends which BB didn’t have such as :
 TouchScreen
 Camera phones
 Appliocations
 These heavily contributed to its downfall.
 Celebrities and well known people started buying iphones and people started following
them because apple innovated their productsa based on trends.

Weaknesses: (Manshor, 2015)

 Poor campaign and promotion.
 Blackberry Operating system was very narrow.
 Poor positioning in the tablet market.
 Losing brand loyalty.
 Market perceptions of devices being for professionals.
 Research and Development limited on innovation capabilities.
 Internal Management ( 2 CEOs).

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 Expensive.

Threats: (Manshor, 2015)

 Rapid Technological Change
 Saturated smart phones market in developed countries.
 It was difficult for them to penetrate Android and Apple controlled markets.

Innovative Competition and Cyclic Adaption Misalignment: (Moussi)

1984-2007 was the golden era for Black berry where it was known for its innovative products
and services and the most secured data networks until the launch of iPhone. BLACK BERRY
followed a cycle to steadily improve their mobile communication businesses.

But during the iPhone launch in 2007, Black Berry faced a “Cyclic Adaption Misalignment” which
means the Black berry got left behind than their competitors because they lag one or two
phases as compared to their competitors like iPhone in adaptive cycle in the domain of
pioneering new innovative technologies due to which they suffered a great loss in the market
share and many opportunities. Black berry lacked important innovations which were being
supplied by iPhone. The first one is design. Operating system of iPhone was extremely
consumer friendly than lack berry .Moreover Google also launched android system which was
much easier and user friendly.

Black berry launched BB Storm for optimal experience in its “reorganization” step but it was a
failed product. And in at that point, Google and apple were already in next step of cyclic
adaption.

Secondly, Both Google and Apple launched their Playstore and App store respectively in 2008
having large no of apps for user convenience. Blackberry also launched their AppWorld in 2009
in a rush and so it was not successful having very less number of apps.So the point is , both
Apple and Google were continuously exploiting their innovations, Blackberry did not. Both were
one major step ahead of blackberry.

Thirdly, in 2010, Apple launched their iPad tablet. In order to compete, Blackberry also
introduced their Playbook after few months by speeding up their adaptive cycles and to
maintain market share but when they delivered it next year in a rush, its quality was low hence
it was not well received by customers and Playbook got unsuccessful.

So these above three examples show that how blackberry got left behind than their
competitors due to cyclic adaption misalignment.

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Managerial Effect on Adaptive Cycle: (Moussi)
One reason blackberry got trapped behinds its competitors is that they didn’t get the desired
results by speeding up their adaptive cycles because it leads to rush which leads to quality loss.

Another reason is from managerial perspective. Blackberry was pioneer in mobile devices and
services and most secured data communication networks till 2007 but during all their golden
era, their innovations consisted of refining their existing technologies and they did not
produced any radical innovations. So we can say that management of blackberry was very less
focused on radical research and development and more focused on business but that worked
well only before 2007 because after that it was the era of radical innovations for example after
the introduction of cross platform Whatsapp messenger, BBM was declined but their
management still focused on refining their own existing products which was a total waste of
time and effort as they were totally replaced.

(Muni, 2016) Having 2 CEOs was at the same time was also a problem; although they had
splitted up the tasks but still dual leadership structure caused dysfunction in the company. As
they used consensus among multiple vice presidents involved to go ahead and it didn’t work
well. Internal deadlines weren’t taken seriously. Multiple teams working on the project would
realize they would miss the deadline ,but nobody spoke a word, under the belief that another
team was even farther behind. Since those teams weren’t fully communicating, executives who
oversaw them had little idea to the source of the problem.

(Ciaccia, 2013)In 2012, New CEO Thorstien heins replaced the 2 Co CEOS (who were of a view
that iPhone wasn’t a threat to blackberry empire) which gave a company, its investors and
faithful cliental a little hope. He started a CORE program cutting costs and planned to
introduced new phones Z10 and Q10 in 2013 but then problems started as Z10 was not selling
well because of rumors that stores has very less inventory and this device is very hard to
find.Moreover the BB10( Company’s operating system) received an update to patch serious
flaws before it was released to public.

Stock Crashing: (Ciaccia, 2013)

Due to delays of blackberry products and poor reviews of customers, blackberry’s sales
continued to decline. In 2013 as it got famous in the market that the company is serious
trouble, stock market got a sudden and sharp downturn.in septemper 2013 they announced
that that they are getting out of consumer business and their fiscal second quarter earnings
missing estimates by 50% and cutting 4500 workers .shares of company dropped to 20% that
day and company started searching for its buyer.

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Blackberry had the stock price $216 in 2000, reached to its maximum at $241 in 2007 and
declined to its minimum at $10.6 in 2016

Fig 2 (Ashwin, 2016)

Conclusion:
(Moussi) Blackberry used small and conservative adaptive cycles to continuously improve their
products which lead it to become most valuable company till 2007 but the same leads to its
disastrous failure after 2007 because of cyclic adaptive misalignment due to no radical
managerial approach. Focussing on the tens of millions of customers it already had, blackberry
missed out on the billions that were to come.They should have appointed a new management
having radical innovative approach in order to keep up in fierce competitive market.in 2013,
CEO and other managers stepped down and there was a plan to sell a company by splitting it in
parts but later in November 2013 sale plan was cancelled and they receive an investment for
last try under new CEO and new leadership. (Ciaccia, 2013)No matter what happens to the
company , its only its leadership which has to be blamed for companies failure. Resting on your
laurels, watching a new competitor take your product and vastly improve it, then watching
others do the same while nothing new comes from your operations isn’t a recipe for success.
(Savov, 2016)No matter how good you may already be, there's always the potential to do better,
and if you're not willing to change and do the scary new thing, someone else will. Adapt or die.

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Works Cited
Ashwin. (2016, 10 17). BlackBerry Case Study. Retrieved from Prezi:
https://prezi.com/ocdfq20roqzz/blackberry-case-study/

Ciaccia, C. (2013, 9 30). BlackBerry: Where it all went wrong. Retrieved from BGR:
https://bgr.com/2013/09/30/blackberry-downfall-analysis-iphone/

Manshor, A. (2015, 8 9). Strategic Blunder of Blackberry. Retrieved from SlideShare:

https://www.slideshare.net/sasi_skv/strategic-blunder-of-blackberry

Moussi, A. (n.d.). Mini-Case study: The downfall of Blackberry.

Muni, S. (2016, 12 17). What were the reasons of the downfall of Blackberry? Retrieved from
Quora: https://www.quora.com/What-were-the-reasons-of-the-downfall-of-Blackberry

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