Apa style research paper research in motion company
1. Research in Motion Company limited (RIM)
RESEARCH IN MOTION COMPANY LIMITED (RIM)
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(26 February 2011)
2. Research in Motion Company limited (RIM) 2
Table of Content
1.0 Introduction of the organization............................................................................................3
2.0 Identification of the industry..................................................................................................5
2.1 RIM Competitors...................................................................................................................6
2.2 Potential Profitability of the Industry....................................................................................7
2.3 Bargaining Power of Customers...........................................................................................7
2.4 Threats of New Entrants........................................................................................................8
2.5 Threat of Substitutes..............................................................................................................8
2.6 Bargaining Power of Suppliers.............................................................................................8
2.7 Competitive rivalry................................................................................................................9
3.0 Company success.....................................................................................................................9
3.1 Intensive research..................................................................................................................9
3.2 Good External and Internal Economy.................................................................................10
3.3 Technological growth..........................................................................................................11
4.0 Reason for failures in the company......................................................................................12
4.1 Legal Issues.........................................................................................................................12
4.2 Political aspects...................................................................................................................12
4.3 Social and Cultural Forces..................................................................................................13
4.4 Current firm-level strategy..................................................................................................13
4.5 Current business-level strategy...........................................................................................14
4.6 Competitor’s business-level strategies................................................................................15
5.0 RIM marketing strategy........................................................................................................15
6.0 RIM financial position and financial strategy.....................................................................16
7.0 RIM production and purchasing strategies........................................................................17
7.1 HR and Information Technology strategy...........................................................................17
7.2 RIM strengths.......................................................................................................................17
7.3 RIM weaknesses...................................................................................................................18
7.4 RIM opportunities................................................................................................................19
7.5 RIM threats..........................................................................................................................20
8.0 Strategic alternatives are available for RIM.......................................................................20
9.0 Pros and Cons of the alternatives.........................................................................................22
9.1 Selected alternative..............................................................................................................23
9.2 Implementation....................................................................................................................24
9.3 Controlling the alternative..................................................................................................25
9.4 Anticipated crisis.................................................................................................................25
10.0 Appendices............................................................................................................................26
11.0 References.............................................................................................................................27
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Research in Motion Company limited (RIM)
1.0 Introduction of the organization
Research in motion limited (RIM) (TSX: RIM, NASDAQ: RIMM) is company in Canada
that deals with telecommunication and wireless devices and has been known for the outstanding
developing of blackberry Smartphone. The company has it is headquarter in waterloo Ontario in
Canada and they are the main sponsor of RIM park that is situated in the northeast of the city.
The company was founded by mike Lazaridis who is currently the company co-CEO. He works
alongside Jim Balsilie.
Before the company produced Blackberry, it was working with RAM Mobile Data and
Ericsson in turning Mobitex wireless date into a two-way paging and wireless e-mail network.
During their work with the Eriksson Company, they developed Inter@ctive pager 950 that
started functioning in 1998. This device was a size of a bar soap and competed very well with
Sky Tel two-way paging network that had developed by the Motorola Company,
(BlackBerry.com, 2010).
The Canadian institution and venture capital investors funded its early development in
1995. It did this through placing it in the privately held company. Working Ventures Fund Inc.
made a step by investing in the company with five million Canadian dollars. This was to be used
to complete the company development of the two-way paging system hardware and software.
RIM floated shares in the Toronto Stock Exchange in January 1998. Before initial public offer,
they had raised thirty million Canadian dollars in pre-IPO financing.
Since the time that they sold their IPO in the stock exchange market, they have produced
several devices that run using GSM, CDMA and iDEN networks. Blackberry devices did very
well in the corporate world as it send the message very fast and also it was very efficient in
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sending e-mails. This made it to be nicknamed ‘Crack berry’ as they called crack cocaine as
some of the people believed that one could not live without it.
Research in Motion and Information Associates reached a licensing agreement in 2006.
This was meant to ensure that the RIM Company would offer Pocket Mac that was used by the
Blackberry to Mackintosh users free. The RIM Company grew tremendously and in 2008, the
Mediacorp Canada Inc. named it among the Canada Top hundred employers in the MacLean’s
news magazine.
In 2009, RIM Company announced their expansion strategy that would involve global
operation. This was done through opening an office in North Sydney in Australia. This new
office had training facilities, a strategic partner marketing centre, research and development
center as well as technical support service center. This leads to increase in the work force in the
company to 12000 jobs that the company offers worldwide.
In the spirit of expansion, the company in June 2009, they announced that they were to
acquire Dash Navigation who was the manufacturers of Dash Express. On the same year on
august, they were capable of acquiring Torch Mobiles therefore enabling them to include
Webkit-based browser on the Blackberry. The idea of expansion and urge of exploiting the
market may have contributed to the RIM Company to be announced by the Fortune Magazine on
18 august 2009 as the fastest growing company in the world. They gave a growth rate of 84% in
profits growth within a span of three years.
The company continued its expansion strategy in 2010 by acquiring Viigo Company,
which is the developer of the Blackberry applications. This is a company based in Toronto
Canada. It went ahead on April in the same year QNX Soft Ware systems. This was done
through the agreement that was signed by the company in corroboration with Harman
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International on 12 of April 2010. This collaboration will ensure that RIM Company is able to
integrate and enhance user experience with Smartphone and in-vehicle audio and infotainment
systems. The deal will also ensure that the company integrate other values to the company such
as intelligent peripherals that will help add intellectual property to the RIM‘s portfolios. This will
help the company to provide ling term synergies to the company’s devices through
complimentary operating systems experts in both QNX and RIM Company, (Tricia, 2010).
It was until September 2010 that the company announced the launching of the
BlackBerry Playbook tablet computer. This was projected to be in the market by the beginning of
2011. By May 2010, RIM operating system occupied 10.4% of Smartphone operating system in
the market, (Lendino, 2009).
2.0 Identification of the industry
The main identification that made the RIM Company to be outstanding in the market is
the realization that it cannot offer only mobile enterprise software only. It realized that this
software should be given to the market as a complete offer that can be used as a complete
component in the market. Therefore, it had to ensure that the service that they were offering had
to be given to the market through a mobile handset. It also succeeded in convincing the
customers to sell the IT products and service. This ensured that the company remained a force to
reckon with in the market arena in their pursuit of wireless email market. Initially, no other
company offered such service as the competing companies as seven and Visto companies were
not making handsets while Nokia never offered wireless email services.
These advantages made the company to grow very fast as the investors slammed in the
company in the past years. It established itself by taking advantage of being sole suppliers of
software devices in an immature market. It therefore established itself as a leader who was
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capable of raising their company very fast than other companies. However, the market has
matured up very fast of recent soon and RIM is facing a stiff competition from various
companies.
2.1 RIM Competitors
The company has experienced significant criticisms from their customers. This has made
them prove that that they are still competitive in the market. They are running out of the stream
as the competition is building up on daily basis. As it experience competition crisis, it is very
important to convince their customers by protecting their brand in the market and ensure that the
purchasing decision as well as operators’ launches is not delayed.
Initially, RIM could not have feared competition especially in the mobile email market.
This is because most of their competitors were small companies which most of them were
startups. These companies had limited resources and less attractive offers.
Nevertheless, RIM Company has found amidst mighty company recently offering great
competition. These companies are out to ensure that Blackberry do not become the windows of
the wireless email. One of the Research In Motion Company competitors is the Microsoft
Company. The company is out to ensure that it push itself in the email market. The other
company that poses a great threat to the company by launching competing products and
acquiring Intellisync is Nokia Company. Intellisync Company initially supplied the RIM
Company with synchronized desktop software. These two companies are bigger and pose stiff
competitions to RIM. They have also resources and they are very influential, (Elsa & Green,
2006).
One of the biggest competitions that the company poses is that they have partnership with
the operators and they are both producing the handsets. This means that though the company has
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a good market foundation, the company is experiencing pressures especially in lowing their
product prices to cope up with the market. Nokia and Microsoft are positioning themselves in
giving their customers cheaper services that are ensuring RIM to feel the pressure to lower their
prices.
Other companies that are still getting to the smart phone market are computer
manufacturers Acer and Dell. Dell is rushing in the market to produce Del Fortune 500 smart
phone. Palm is also another company still competing for a pie in the market with them coming
up with iPhone, which is to use Sprint network that will be available through Verizon. Google is
pouring many resources to fund its Android Smartphone operating system and it is offering
training over it. Motorola is another company that is still supporting Android Smartphone. These
all companies are at the verge of getting into markets that RIM Company has dominated for
along time, (docshare.com, 2010).
2.2 Potential Profitability of the Industry
There are different approaches that are used in the determination of profitability in
different markets. Am going to use the model that was developed by Michael E. porter, where
the profitability potential of an industrial is going to be described as the long run return on the
investments, is much reliant on the degree of competition in the selected industry. The five
forces that are described by Porter include; the threat of new entry, the power of suppliers, the
power of buyers, the threats of substitutes, as well as the industry rivalry
2.3 Bargaining Power of Customers
The options available to customers, bargaining power is very high. This is because there
are other brands available in market, which are offering competitive markets. This is particularly
with the consumer sector other than the enterprise sector, (smh.com.au, 2008)
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2.4 Threats of New Entrants
The entry to the market segment that is dominated by RIM is not easy. This is based on
the fact that, all established companies have the opportunity of being new entrant to the
diversified communication industry of Research in Motion. Though until now, RIM has been
having full advantages of its technological dominance in the market place, there still remain the
possibilities f new entrants in the field. Such companies might use older technology in a
revamped and modernized way. The threats of new entrants increased the ODMs usage as well
as globally standardized components. Barriers to entry have considerably reduced. This has made
companies with good brands have the capability of using their brand names to introduce their
products in the market. There are big firms like Google together with other IT giants have the
opportunity of entering the market as they have the required infrastructure. For instance, the new
entrant is Apple, (Speed, 1989).
2.5 Threat of Substitutes
Getting a substitute for mobile sis very hard, what firms are trying to do is just improving
on the existing technology, other than coming up with and eliminating the mobile technology
with completely new products. On the other hand, new technology advancements have posed
serious risk of substitution. The 3G and EDGE technologies pose immediate threat to RIM’s
market control. Though such technologies are being used by RIM, they offer ways through
which new players may enter the market. However, RIM is well positioned in the market and ha
precedence of being in a position to integrate its products, to form new items.
2.6 Bargaining Power of Suppliers
The bargaining power is attributed to the sheer volumes raw materials and other
components bought by RIM. The suppliers in the industry have low bargaining power in the
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manufacturing face. For instance, the processors of similar architecture used by RIM are
manufactured by many companies like the Intel, freescale semiconductors, Samsung among
other companies. This is based on the fact that, suppliers always looking forward to associate
themselves with major firms for long term. On the other hand, there exist different suppliers for
the services that are offered by RIM. Due to this, RIM has to make use of networks of existing
mobile operators, and in some occasions, where there exist limited number, or only one operator,
the bargaining power of that supplier tend to be elevated. However, even without Lynas, China
still controls more than “95 per cent of the world's supply of rare earths, used in Research in
Motion's BlackBerry, Apple's iPods and General Dynamic’s tanks.” (smh.com.au, 2011).
2.7 Competitive rivalry
Amongst the smart phone providers, the most challenging companies to RIM are Apple
and Apple. These two companies have forced Research in Motion “to innovate the products in
order to stay competitive and enjoy high market share.” Porter, 1980).
3.0 Company success
3.1 Intensive research
To ensure that the company does not exist in isolation and increase their performance, it
engages in intensive research to vary their external environment. This is because there factors
which are beyond the firm’s control. It is true that, Research in Motion has an extensive market
globally and it is further involving into newly industrialized nations. This creates a need for
intensive research for the company in all the areas in globally. As an effect, its environmental
analysis has to regard to the economy of the world, as a homogeneous environment. Therefore, it
creates a need to ensure that they understand the way the market is in all the parts of the world
this part has been a great success in the company. They have ensure that they created research
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sections in their companies globally which has made them compete intensively in the market and
in provision of quality phones.
3.2 Good External and Internal Economy
Due to the high demand that has been brought by the national and international markets
in the past two decades, it has contributed to the success of the Research in Motion Limited
(RIM). Most of the countries Gross Domestic Product per capita have risen especially in
countries that RIM has been operating in. This has made the demand of the RIM product to
increase sharply. In fact, RIM enjoys favorable environments for business growth. This has made
them to expand their business globally especially in the developing countries. A good example is
the premise that they opened in Sydney Australia. This is has really been made possible by the
purchasing power of individuals going high. Due to improved living standards, most of the
people are able to afford their products. A growing economy as a result has guaranteed RIM a
ready market for their products.
In addition, a growing economy guarantees RIM a source of capital. This is because there
will be more money in the disposal as financial institutions and governments will have money to
lend out at favorable interest rates. The improvements in International as well as national
economy have lead to increased expansion and creation of new market, which in its effect
increases the need for business increases. To ensure that private sectors needs are catered for
amid their demographic increase, hence the usefulness of BlackBerry to many business
professionals, which are the primary consumers of RIM’s products. The increased demand for
BlackBerry in developing economies is much noticeable fin the hundreds of the new corporation
deals that has been being signed by RIM every year with local operators’ worldwide.
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On the other hand, global recessions that have taken place globally especially the 2008
economic recession and depression, resulted in lower consumer disposable income. The interests
as well as the exchange rates in different economies have also affected the company’s strategies
in different ways, (John, 2007).
3.3 Technological growth
The technological advancements that have taken place in recent soon has been the most
significant environmental impact on the business success in RIM. Businesses in the whole world
are evolving into using email as one of the main communication and contact medium. This has
made the usage of such mediums like fax and as well as written mail nearly obsolete. By being
the first and probably still the one and only single company that that have been providing e-mail
to go solutions, the company has greatly benefited via providing a medium for professionals to
be in a position of leaving their tables and still communicate through the emails. In addition, its
technological marketing system, which has been through global wireless communications
carriers as well as third party distribution channels, has greatly advantaged the company in one
way or the other.
However, new technologies have posed a risk to the market, for instance the introduction
of the 3Gbraodband services have affected smart phones negatively. As the internet continues to
be faster and efficient, lit might end up attracting new players, who might come with new
features as well as the applications in the sector. Technologies have increased the reuse of
phones due to recycling, (authorstream.com, 2010).
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4.0 Reason for failures in the company
4.1 Legal Issues
Since the turn of the century, the company has been involved in a number of suits related
to the alleged patent infringement. Several legal issues that have been put in place to regulate
businesses have brought this about. The most recent and notable one was the brought about by
NPT Inc. It involved patent infringement in email over the wireless technology. This battle
between RIM and the NTP Inc adversely affected e-mail users in the U.S. However, the battle
has made the company to rise to any occasion that has met it afterwards making it position itself
very well in the business world. It also made the company to be very sensitive in making sure
that they protect their products. The legal briefs that have been filed in this case conveyed
charges of misleading a federal judge. However, there have been claims of ant-Americanism as
well as the accounts of vital documents going missing from the library in Norway. After an
intensive legal battle, in 2006, Research In Motion ltd announced that, it has successfully paid
US $ 612.5 million. Visto Corp brought another lawsuit to court in 2006, for the patent
infringement, (theregister.co.uk, 2002).
4.2 Political aspects
Political factors in some countries where RIM operates have lead to financial deficits,
which have resulted to higher taxes leading to lowering RIM’s profitability in such countries.
The changes that have taken place in different parts of the world like changes in government
policy, and government stability, have resulted to the company’s strategies. There are also legal
issues that ensure clean environment, as they regulate the quality and durability to ensure longer
functioning, phone fascias, which can be used for a very long time. Regulations have been put in
place to ensure that, phones are being produced and used with all possible environment friendly
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production methods. Other legal factors affecting Research In Motion Ltd include; the control
over pricing and monopolization. The telephone regulations of different nations in most cases
deal with quality, health as well as the safety of mobile users.
4.3 Social and Cultural Forces
The shared norms of different businesses that are shared in the whole world have
drastically changed. This has occurred considerably taken place in the past couple of years, with
businesses becoming more customer oriented. As an effect, communication has increased
between customers and businesses, which have practically increased the use of RIM’s products.
On the other hand, cultural diversity has also affected the global marketing communication of
RIM Ltd. Globally, there are different cultural standards being, thinking and acting because of
cultural diversification, which have influenced RIM’s workplace values as well as business
communication. Therefore, as an effect, for RIM ltd to ensure effective global communication
and successful business transactions, it has promoted cultural differences and enhanced cultural
sensitivity. Marketing across cultures globally has resulted to sociological differences. While
there are diversified global cultures for RIM ltd to consider, global communities are being
influenced by different initiatives. The goodness is that, Smartphone have been accepted by
customer’s lifestyle and integrity part of day-to-day life in most countries. It has been considered
as a high value solution that has been used in the provision of many applications across the
globe, (authorstream.com, 2010)
4.4 Current firm-level strategy
Due to the urge that the company has to expand their territory, the firm has put up firm
strategy to ensure that they retain their competitive edge. Due to the popularity of their software,
they have signed an agreement with the Nokia Company who is their market leader competitors
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who agreed to license their software on their new cellular phones. The firm has also expand their
territory by ensuring that their radio modems has received GSM/GPRS certification in Europe
and pacific (theregister.co.uk, 2002). This makes them to have third party vendors with their
hardware across the globe.
The company has recently streamlined their operations to ensure that their business is
more efficient. This has ensured that they lay off some of their workers from 2200 to 1950 to
reduce the overhead cost of their product thus projecting increase their profits.
4.5 Current business-level strategy
To ensure that the business is up to the competition that has been of recently posed by
their competitors, it has put in place some various strategies. They decided that they would go a
step further in their business by producing a Blackberry on a chip product that is being used
through the third party products. This made the phone manufacturers make small devices that are
powered by Blackberry chip.
The company has taken advantage of licensing Blackberry to phones as ISP has
subsidized cellular phones that is not the case with Blackberry pagers. This means high sales for
the company. The decline in sales that has been experienced by the company was due to service
charges. Therefore, after the company introduced these new features, sale is expected to rise.
Finally, the company has provided phones that have voice capabilities. They are also PKI
enabled thus supporting encrypt and sign mail message through digital certification. This makes
the users able to see attachments such as PDF with selective options, MS Words, Excel and
PowerPoint (smh.com.au, 2011).
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4.6 Competitor’s business-level strategies
Most of the RIM company competitors are offering very diverse product at cheaper
prices. Such company as Nokia, which is the biggest RIM competitor manufacture handsets and
sell IP network to their customers making them be very competitive. Their market prices are
considerable thus very competitive. Nokia has acquired Intellisync Company that has been
supplying synchronized desktop hardware to RIM to ensure as one of their business strategy to
expand their territory. Motorola Company is funding the Android Smartphone that has been
produced by the Google Company as its strategy in putting more force in the market. Most of
these companies are collaborating with other companies as their strategy to ensure competition in
the market is kept up to the standard.
5.0 RIM marketing strategy
Marketing is an integral part of any company; it is a process of developing value and
awareness of its products or services, as well as informing and communicating to potential end-
users concerning what the organization has in store for them. It also entails engaging consumers’
relationships in order to attain the desired outcome. Organization’s marketing strategy has been
deemed the backbone of RIM company marketing plan. It has helped the company integrate the
marketing goals, policies as well and tactics. The company has been ranked to be the fastest
growing company globally recording an increase of 84% in profit and 77% increase in revenue
in the last three years. This is thanks to its marketing strategy that successfully blends the four
marketing mix, pricing, advertising or promotion and distribution (Fortune Magazine 2009).
According to Vuong, 2008 the company uses B2C marketing strategy. The company
online strategies can sale goods to individual customers. Through the arrangement, customers are
capable of buying the company’s product via the internet or just make a call to the customer
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service for help, as they are need of formally buying a product. Similarly, developing of unique
and quality product that is competitive in terms of prices is also used in marketing. Using low
prices for its products also has been used to attract customers. This is driven by the notion that
when prices for its products are low, and a relationship between the company and customers are
in place, then it will be in a position to sell additional goods thereby increasing its margin
(Sweeny, 2009). To successfully do marketing in a successful manner, the company does carry
out research, which is essential in decision making when it comes to making marketing
decisions.
6.0 RIM financial position and financial strategy
RIM according to Fortune 500 is the fastest growing company having a stable and
growing financial base. For the third quarter of 2011, revenue grew 19% to stand at $5.49 bn
from $4.62 bn the previous quarter. This is a 40% rise from the same quarter the previous fiscal
year. Breaking down the revenue for the period are 82.0%, of devices 15.0% for service and
3.0% for software. For this period, the net income stood at $911.1 million compared to $796.7
million in the previous quarter and $628.4million in the same quarter the previous year. All sorts
of investments total cash as well as cash equivalent stood at $2.5bn this is as o0f 2010 November
2010.
An examination of the company’s short-terms and long-term assets as well as liabilities
and equity shows that RIM heavily relies on equity for funding. Most of its assets are short-term.
This means that RIM is interested in having in place a financial strategy that is short-term. RIM
utilizes its own funds to finance assets.
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7.0 RIM production and purchasing strategies
RIM uses lean production. This is backed with determination, dedication as well as
attention. This has seen to it that the company is effective and in time in production. The same is
also applied in purchasing activities. Three main positions are in place to over see purchasing,
production and repairing equipments (Dilger, 2009). Lean production, purchasing and supply
management coupled with adoption of technology has brought about a supply chain,
manufacturing and purchasing that is economical, much leaner for smooth flow of the products.
7.1 HR and Information Technology strategy
In terms of technology, RIM is one company that is has well constructed plans of
adopting new technological innovation. The IT department has human resource that is well
acquitted to issues relating to ensuring that technology is adopted in a successful manner. With
regards to human resource the CEOs Lazarids Balsilie most valuable employees. The two have
propelled, advocated and nurtured a culture where employees are seen as partners and the most
valuable resource. This is depicted by the well-drafted compensation as well as bothers benefits.
More importantly, they are actively engaged in making decisions, provided with adequate
information and a conducive environment where they are free to try innovations, (John, 2000).
7.2 RIM strengths
The company has numerous strengths that make it stay competitive. Through its business
strategy of business to customer, it has managed to have build customer loyalty. This has been
attained by having a well-developed and nurtured brand image. The brand image has been
successful in communicating necessary information to the customers.
On the same note, Research in Motion has a variety of products line of phones. With this
in place, customers are made to be loyal as they can get a variety in the same company. The
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innovative products it manufactures for instance the Blackberry is well designed with a variety of
features for instance it can combine the power of a state of art wireless email with capabilities of
synchronizing it with the desktop. Its QWERTY keyboard for examples makes texting an easy
and enjoyable task (Sweeny, 2009).
Forming partnership with other stakeholders such as service providers all over the globe,
which is 300 networks in 120 different countries, is in self a competitive advantage to the
company. It is worth noting that the company also has a human resource/workforce that is well
acquainted to their task, duties and responsibilities. This has been attained by the various
mechanisms used to satisfy and motivate their workers hence they are ready to offer quality
services to customers.
More importantly, RIM has been able to adopt successfully technology. It is the adoption
of technology that has made it be in a position to employ innovative strategy in developing new
and quality products that are eye catching. Additionally, the company is involved in designing,
manufacturing as well as marketing of its own products.
Global dominance of the company is another strength it posses. It is no doubt that RIM products
are used allover the world. Additionally, the ability to carryout market research places it at a
better position not only currently but also in the near future as the information generated are used
in making rational decisions, (zenportfolios.com, 2010).
7.3 RIM weaknesses
On major weaknesses, facing the company is its stages of development. It seems that the
company has attained or about to attain maturity stage. This is evident by the slowing rate of
growth; this is a clear indication that RIM is entering maturity or declining stage. The company
targets only few customers; majorly the professionals. This strategy is risky, because, an increase
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in competition, customers might be taken away, and as a result, the company might fall into
default. The company targets niche market, so its products are highly priced.
Although it is true that carrying out market research is desirable RIM uses a lot of money
to budget for the program. This is not desirable when it comes to financial performance of the
company. Similarly, the pricing strategy, which is discriminative, is undesirable as it is
prohibitive to a certain market segment (Dilger, 2009).
It is worth noting that the company has a much less market share in consumer market.
This has been made worse by the poor performance in stock market. In September 2010 23, the
stock price was $ 92.41 and by October 19 same 2010 it fell to $69.45. Additionally, RIM has
limited product line as it only engages in phones only unlike its competitors. Lastly, the
technology developed by the company in some instances is very complex to some potential
customers. Finally, compared to Apple, its products have fewer applications, (Martin, 2007).
7.4 RIM opportunities
RIM is faced with numerous opportunities that will help it maintain and probably
improve its market value and position in the face of fierce competition. One major opportunity is
to grow in applications and accessories. This will augment its phone products. It is worth noting
that there is room for it to engage in co-branding ventures as recently seen in Apple and Oracle.
On the same note of growth and expansion, RIM Ltd has the capability of venturing in
developing countries where there is evidence of growth of use of its products. This presents a
great opportunity for the company to capture the markets in developing countries that may help it
increase revenue and profit margin.
The number of youths in the current population is in the rise. The tech-savvy young
individuals might offer the desired market hence a green marketing opportunities
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7.5 RIM threats
Like any other organization, RIM Ltd faces a number of threats that it needs to be weary
of. The current market is saturated hence this pose a threat to its expansion and growth. The
unstable economic nature exemplified by the recent financial crisis in 2010 from 2008 may pose
another threat to the company.
Fierce competition from such competitors as Apple that is still new in the industry, HTC
Jujitsu LG, Motorola, Nokia, Samsung, Sony Ericsson as well as Palm Inc who are can easily
take away customers targeted by RIM.. Another threat is brought about the fast pace with which
technology is being brought forth. It is apparent that such technological changes come with
uncertainty that can bring down an organization (Fortune Magazine, 2009).
Similarly, issues about patent infringement are a threat to the organization. Additionally,
as the industry grows, there is need for professionals especially in telecommunication
engineering. Time will come that the supply will not be at par with the demand hence RIM will
not be in a position to acquire and replace its aging workforce.
8.0 Strategic alternatives are available for RIM
There are three strategic alternative for the organization brought forth after a research on
company analysis. These are a market development, product development and or market
penetration option.
Alternative 1: Product development
This options calls for employing a multifaceted plan in developing the company’s
products. Steps to attain this include raising the existing applications to Blackberry handset. This
21. Research in Motion Company limited (RIM) 21
is what Apple has managed to successfully accomplished in the iPhones. Ideally, co-branding
initiatives can also be used by the help of such software’s organization as Nintendo, which will
help to improve the gaming features, which will appeal to customers (Grooms, 2010).
Alternatively, to develop the product of the company, there is room for it to come up with
services for instance enhances handling of customers while addressing issues in regards to
hardware. RIM Ltd can also enter into green marketing where it recycles and refurbish handsets
used.
Alternative 2: Market development strategy
This kind of strategy main aim is to reach new market segment. There is no doubt that
there are a huge number of potential customers from a lower income category especially in
developing countries; this might offer the company with a profitable market for its products.
Analysis seem to show that RIM is about to attain its maturity stage or declining stage and an
option that will help it come out of this phenomenon is introducing its products at a much lower
prices. It would be a good initiative for the company to sell the older models at a discount as it
introduces newer versions. Similarly, as this goes on creation of a product depth can be done in
which it entails developing of Blackberry models having the same fancied images but with
unequal features like those in smart phones. A customer segment that includes students in
colleges, teenagers as well as new users of the model can fancy such simple versions.
Alternative 3: Market penetration plan
The aim of this alternative or option will be to raise revenues from the current clients the
company has as well as attracting new potential customers from the existing target market. The
major strategies employed to attain this will be intensive advisement, publicity and promotions.
RIM can for example provide various kinds of discounts to family members of their current
22. Research in Motion Company limited (RIM) 22
customers (Pearson & Gritmacher, 1990). This will enhance the existing customer loyalties
especially if the same is given to children who are the potential future customers of the
company’s product.
Increased and extensive promotion and advertisement through the various media; print,
TV commercials, Radio jingles and through the internet will help the company penetrate more to
the existing customer base. Alternatively, through various social responsibility initiatives, there
are chances that the organization for instance after sponsoring a sports tournament can gain
market advantage.
9.0 Pros and Cons of the alternatives
The advantages of the first alternative are; it will help increase market share of the
company’s products in the target market, customer loyalty will be enhance as well as
improvement in the company’s brand image. Additionally, co-branding will see to it that the
product perceived value is increased (Monczka & Guinipero, 1984).
On the other hand, the drawbacks of this alternative include the high cost incurred when
carrying out market research, there is also a possibility of diluting the brand image of the
company when it engages in co-branding and finally the whole activity is time consuming as
developing software are a complex activity.
Alternative two is advantageous in the following ways; products will be affordable, this
coupled with accessibility makes the company to easily conquer the new market segments, the
company will also be in a position to make profit from resources deemed useless and outdated
inventory. However, the alternative is characterized with the potential of diluting the company’s
brand, decreasing the perceived value of the company is other products due to its cheaper
23. Research in Motion Company limited (RIM) 23
products with fewer advanced features (Hempel, 2009). There is also the possibility of creating
communication gap as there will be fewer functions on the older models of Blackberry.
Market penetration as the third option can help the company to increase market
awareness of its products, through advertisement and promotion more individual will be able to
recognize the company’s brand. Lastly and more importantly, the whole plan will make the
company’s product to be more and easily accessible as online advertisement can be made with an
option of placing orders online.
Nonetheless, this option has potential drawbacks. These include high cost incurred when
establishing and running the entire promotion and advertisement activity, there is also the
possibility of losing revenue as a result of using discount in selling products and finally the
alternative is faced with limited growth capabilities in the current market Sako, 1992).
9.1 Selected alternative
In my opinion, alternative one, which is product development, is the best and opts to be
the solution to the current uncertainty facing RIM Ltd. Having in mind that stiff competition
brought forth by such companies as Apple, which produces sleek products with varied features,
can only is countered by the same but advanced products. Product development will see to it that
RIM comes up with new and advanced applications and software. Joining hands with such firms
as Nintendo, which is capable of helping the company improve on its applications for instance
gaming features, will definitely give it a competitive advantage (Watts et al. 1995).
The reasons for choosing this alternative stems from the advantages it brings which are; it
will help increase market share of the company’s products in the target market, customer loyalty
will be enhance as well as improvement in the company’s brand image. Additionally, co-
24. Research in Motion Company limited (RIM) 24
branding will see to it that the product perceived value is increased. All these will be possible
and at the same time helping the company to maintain market dominance.
9.2 Implementation
For RIM to successfully implement the chosen alternative, there are three vital
components that need to be closely followed. One program that needs to be in place is concerns
recycling and refurbishing. With this, there is need for the company to ensure that it acquires all
relevant supportive documents before embarking in the green initiative (Tanner, 1998). Old
devices will then be collected from the various locations and shipped to a central place where
sorting will be done. At this point, those units that can be recycled are re-sold while those that
are completely of no use are done away in away that are friendly to the environment.
Secondly, development of a wider range of software’s and applications is done to
enhance market share as well as perceived product value. In order to realize this, the company
will venture into co-branding initiatives with such organizations as Nintendo. Once the software
is developed, they will be made available to customers at affordable prices. Considering the fact
that most of the Apple’s software application is priced at or less that 0.99 dollars, RIM needs to
also have such a pricing strategy (Hempel, 2009). Customers will be able to visit RIM website to
download the applications. Similarly free version will also be made available for customers.
With all this initiatives carrying out promotion will help in developing the product. This
can be attained in part by RIM engaging in social corporate responsibility activities. Using
internet, TV commercial will be used to communicate the various applications developed by the
company. It will also be responsible to adequately budget for the whole process of
implementation as money will be needed to carryout extensive market research, marketing and
25. Research in Motion Company limited (RIM) 25
administration (Vuong, 2008). Ultimately, the successful implantation will ensure that the
company continues to grow and maintain it grip in the market.
9.3 Controlling the alternative
It is true that there is need to control the whole alternative because if it is left open, it
might lead to attainment of undesired outcome that might be self-defeating. The company needs
to have in place a committee made of professional in finance, marketing, environment,
procurement and law that will help over see the implementation of the project and that it does not
go beyond its borders (Lascelles & Dale, 1989).
9.4 Anticipated crisis
Based on the current political unrest especially in Islamic countries, the company needs
to be aware of the consequences that it may face as a result of political instability. There is also a
possibility of shortages of skilled and talented human resources. This is as a result of stiff
competition and the fast growth of the industry that needs engineers ranging from
telecommunication to other fields such as marketing (Wauters, 2009).
The future prospect of the company is bright provided it has in place strategies to counter
the negative impacts of the fore mentioned crisis that are anticipated. Having in mind that the
current generation is in ‘love ’ with new technological innovation, there will be market for its
product, however, there is need for RIM to strategized on how to conquer and find their way
through youths in developing countries with low incomes will help it. Secondly, with
technological innovation, the company will be able to meet the aspiration and demands of
customers hence capturing it target market despite the stiff competition it is currently facing.
26. Research in Motion Company limited (RIM) 26
10.0 Appendices
Financial ratio profile
Research In Motion stock performance as at December 2002
27. Research in Motion Company limited (RIM) 27
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