Organization “in the News” Analysis Paper
Organization “in the News” Analysis Paper
Research in Motion, (RIM), is “a global leader in wireless innovation, (which) revolutionized the mobile industry with the introduction of the BlackBerry solution in 1999” [ (Research In Motion, 2011) ]. While RIM has no publically available mission statement [ (missionstudy, 2009) ], we can deduct the following: 1) From the aforementioned description, they are committed to innovation. 2) From the article we will discuss later on, they are seeking to strengthen relationships with developers 3) From past history, reputation, and numerous achieved certification; they wish to provide a highly secure means of communication through mobile devices While it is not possibly to quantify most of RIM’s operational goals we can try to establish what they may entail. A recent interview with new CEO Thorsten Heins points towards having their operative goals built around having an innovative culture that involves employees and develops them and having a top 3 market share globally in the mobile market [ (BlackBerry, 2012) ].
Furthermore, they are also very focused on reducing their costs which is demonstrated by their announcement of a core optimization program and CORE on June 16, 2011. These programs were meant to analyze the companies’ procedures and cut out overhead and redundancy [ (Research In Motion, 2011) ]. RIM’s competitors have been highly publicized and are listed by Yahoo Finance to be Nokia, Google, and Apple [ (Yahoo! Inc., 2012) ]. With RIM being in the mobile market, their consumer base is very broad selling to the general market. With such an advanced device the list of suppliers is vast as they need to provide all the parts from glass to processing chips and these suppliers are located around the world. Lastly, their key partners are mobile companies large and small such as Verizon, Sprint, Vodafone, and Orange. Having previously worked at RIM for a year I know these statements to be fact.
Article Importance and Recap
RIM is currently going through relatively tough times exemplified by, “collapsing market share” [ (Isaac, 2012) ] and their declining stock value. RIM’s shares were being traded mostly between the $14 and $17 range per share in the month of February to date compared to $144 a share in the summer of 2008 [ (Google, 2012) ]. As recently as 2009, RIM accounted for half of the US smartphone market share [ (Gardner, 2009) ], but latest reports have them only accounting for 6.5% of the US market [ (Miller, 2011) ]. This fall from grace from the once dominant organization of the mobile space creates interest from a wide range of stakeholders. Consumers are interested as many have used RIM products in the past and investors are interested as they have gained and lost many dollars from the organization. As the mobile space is a very broad market it means that there is going to be many opinionated individuals for very different reasons.
Because of RIM’s high profile and past and present penetration in the general population, a new business strategy is very newsworthy and is something people will talk about. Mike Isaac’s article, “RIM Claws Back Against Apple and Google With Free Tablets,” covers RIM’s decision to give android app developers free playbook tablets so long as they make their app available on the Playbook ecosystem [ (Isaac, 2012) ]. The article starts with a quote from Nokia CEO Stephen Elop who describes the importance of a platform’s ecosystem or in layman’s terms the amount of apps built for a platform. It further describes the relative lack of apps RIM has compared to Android, the Google platform, and iOS, the Apple platform. After stating the previously mentioned new strategy being employed by RIM, the article describes the reason for such aggressive tactics.
The article lists the sales of RIM’s Blackberry playbook tablet being very disappointing, calling it a flop, as the main reason. The article lastly lists the other strategies that RIM has been employing to encourage app development citing extreme price cuts and Playbook’s virtual android environment which allows android apps to be easily transferred over to the Playbook. This is only possible due to the Android platform being an open OS meaning anyone can develop on it including competitors.
With an organizational theory perspective, this article best articulates a manifestation of 2 important concepts in the mobile market: 1) A resource based approach of assessing organizational effectives with apps and app developers being the scarce resource of note 2) A description of the organizational ecosystem being that of ‘population ecology’. This is demonstrated by the possible compatibility of Android and RIM platforms and the selection process of the market that is still happening most notably with the abandonment of HP’s webOS Resource Based Approach of Organizational Effectiveness
The resource based approach to measuring organizational effectiveness focuses solely on an organizations ability to obtain scarce or key resources. The key measures of this approach are:
* Ability to perceive and interpret the external environment
* Ability to respond to environmental change
* Bargaining position
While RIM’s ability to obtain manufacturing resources is not being questioned, its ability to lure app developers and garner app creation is being put to the test. The tablet market itself is still maturing only having 19% penetration rate in the US and it is growing rapidly [ (Kopp, 2012) ]. RIM entered the market much later then their competitors with apple having released 2 iterations of their iPad before playbook had their initial launch. Currently, the iPad accounts for 57% of the market much due to the early release dates it had over competitors [ (Warner, 2012) ]. The rather quick emergence of the market may have exploited RIM to have a relatively slow response rate to changes in the environment as even when they did launch, the common perception of the playbook was that it was an unfinished product [ (Stevens, 2011) ]. Such offers as cutting their prices dramatically, and giving away playbooks to developers also proves that RIM currently has very little bargaining position with those developers and they have to go to extremes in order to get traction on their development.
By all definitions, this means that RIM is proving to be an ineffective organization by a resource based approach of assessments. If these aggressive measures are effective, the need for them will shrink as time goes on. The tactics are geared towards both increasing consumer bases to create higher earning potential for developers and to encourage more app development with one time offers. More app development will mean higher adoption rates for consumers and the cycle goes on like this. This is in essence what RIM is trying to create; a snowball to roll down a mountain hoping momentum will take over at one point to create an avalanche. Although RIM currently stands as ineffective at collecting these resources, it is clear that they are trying hard to overcome their current shortcoming in assembling an ecosystem.
Although a resource based approach still has the weakness of assuming a stable environment, which is far from the truth in the technological markets, it is actually a much more relevant measure to this situation then it would be to others. Usually a resource based approach lacks the consideration of consumer needs; in this case the scarce resource is created because of consumer needs. The ecosystem of the device became as important as the device itself in the tablet market. As an ecosystem doesn’t directly reflect internal processes or goal oriented approaches of assessment, a resource based approach is very effective in evaluating the creation of a value proposition to consumers in the tablet market. As the article stated, “a tablet is only as good as the apps it runs” [ (Isaac, 2012) ].
The Organizational Ecosystem
An organizational ecosystem can be described by the nature of the interactions between organizations with the environment and each other [ (Daft & Armstrong, 2009) ]. The ecosystem can be described by its interorganizational framework which is defined by how similar the organizations are to each other and whether they act competitively or cooperatively with each other [ (Daft & Armstrong, 2009) ]. Analyzing the current mobile market, it is apparent that the functions each of the platforms have are very similar some apps being available across all platforms and each having very similar functions. The only differentiation there is within the market is the platform they are on, and the form factor of the tablets. Because of the similarity in the tablets across the platforms, it can safely be assumed that the organizations are similar to each other. However, since the differentiation involves different platforms, it also means that they are acting competitively towards each other.
While some platforms are very proprietary like iOS and Blackberry, Android is open source allowing for anyone to develop on it. Certain apps are only available on one device or another and they do not generally share their apps with each other. This is much different if everyone was on one platform and they were being differentiated solely on the tablet hardware. In this circumstance they are pooling their scarce resources of app development and creation in the effort to create a much greater app library and stronger ecosystem. Currently they are each trying to produce their own ecosystems. Since this is the case, it can also be concluded that the companies are competitive towards each other. With both factors being determined, we can refer to the organizational framework know that the current tablet market is that of ‘population ecology’.
‘Population ecology’ market is defined by: * The emergence of new models to meet consumer needs
* The process of ecological change including variation, the appearance of a new population of organization; selection, whether an organization can survive in the environment; and retention, the preservation and institutionalization of organizational forms * The choice of pursuing the general market or a niche within that market meaning being a generalist or specialist respectively The iPad was the first mainstream tablet to have emerged with a market launch date of April 3, 2010 [ (Apple, 2010) ]. This was the first emergence of a tablet business model which was very much an extension of the mobile model but with a new class of product. The tablet is a device that is small in design but has similar functionalities then a laptop. This more portable form factor was the identification of consumer needs. However, since this launch almost 2 years ago, 4 new OS’s of note have emerged being that of Blackberry OS, Android, WebOS and Windows OS.
The key question to ask is how many OS’s can survive in the tablet market. If it is anything like the smartphone market, it is closer to 3 or 4 as demonstrated by market share [ (Smith, 2012) ]. With the emergence of 4 new OS’s and the original iOS this means that eventually one of these would have to default. On August 18th 2011 it was confirmed that WebOS would be the ill fated platform [ (Kumparak, 2011) ]. As WebOS was selected out by the market, it provided a little breathing room for RIM with the quickly expanding market and less competition. To avoid the same fate as WebOS, RIM is actively trying to work on creating their ecosystem as described in the last section. The emergence of an open OS platform as Android also provided it opportunity to adapt their platform to try and include Android apps as well. Both of these tactics are described in the article.
While the article extensively covers a resource based approach of assessing an organizational effectiveness and describes the organizational ecosystem, it fails to well define the environmental uncertainty. It doesn’t consider the broader picture of the market and it could be made more in depth with the addition of an analysis of the environmental framework. Furthermore, it has a very micro approach focusing only on the struggles of RIM with app developers. The environment is a huge factor in technological companies and it could illustrate how important the right decisions are to future success and the wrong decisions to complete failure. To analyze the environmental framework we have to see two key factors: * The stability of the environment meaning the speed of change
* The complexity of the environment
As previously described, the tablet market is rapidly expanding and it is only 2 years old. Combine this with RIM’s dramatic change in market share over the past 3 years it strongly indicated that the environment is quick changing. The complexity of the environment can also be defined as complex one. This can be proven by RIM having to worry about not only manufacturing resources, and app development, but also the extensive testing they must complete in order for their devices to be compliant with regulations. With many different radio bands, Bluetooth compatibilities, wifi bands, java compliance, throughput testing, and active pursuit in both hardware and software, RIM has to deal with an endless amount of variables. The hardware alone would contain a list of suppliers that are wide but then they must further ensure that all the radio frequencies are properly calibrated and the software works seamlessly amidst the global demands of their products.
The article called them a flop even though they had shipped in the hundreds of thousands of devices in 2011 [ (Isaac, 2012) ]. What this means to RIM is that even though they may be down on market share, the market can easily turn in their favor. However, this also means that the market can select them out. The high uncertainty described of the environment is the sword that decides whether RIM will prosper or die. The article does briefly describe the release of BB10, which is RIM’s new OS to be released later this year. However, it doesn’t emphasize that it would be the newest OS on the market and it was able to create the OS in a year and a half years [ (BlackBerry, 2012) ]. With the unstable environment, this means that it could very well be the basis for which their future will be decided upon. The article has a gloomy outlook on RIM’s future but also concludes with “perhaps it can find its way back to a seat at the mobile ecosystem table.” This last statement would be better reinforced with an environmental analysis.
Apple. (2010, March 5). iPad Available in US on April 3. Retrieved from Apple Press Info: http://www.apple.com/pr/library/2010/03/05iPad-Available-in-US-on-April-3.html BlackBerry. (2012, January 22). Meet Thorsten Heins the New President and CEO of Research In Motion. Retrieved from Youtube: http://www.youtube.com/watch?v=QUFwhpcrCTw Daft, R. L., & Armstrong, A. (2009). Organization Theory & Design. Toronto: Nelson Education Ltd. Gardner, W. D. (2009, August 19). RIM Owns Half Of U.S. Smartphone Market. Retrieved from InformationWeek: http://www.informationweek.com/news/personal-tech/smart-phones/219400707 Google. (2012, February 14). Research In Motion Limited (USA). Retrieved from Google Finance: https://www.google.com/finance?client=ob&q=NASDAQ:RIMM Isaac, M. (2012, February 3). RIM Claws Back Against Apple and Google With Free Tablets. Retrieved from Wired: http://www.wired.com/gadgetlab/2012/02/rim-ecosystems-blackberry-playbook/ Kopp, C. (2012, January 24). Tablets, E-Readers Double Market Penetration, Says Report. Retrieved from minyanville: http://www.minyanville.com/businessmarkets/articles/megaupload-anonymous-kim-dotcom-filesonic-tablets/1/24/2012/id/38996 Kumparak, G. (2011, August 18). It’s Official: HP Kills Off w
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 27 October 2016
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