RIM's Board As Bad As Its CEOs - Article

RIM's Board As Bad As Its CEOs
RIM's board, reportedly preparing to oust co-CEOs Mike Lazaridis and Jim Balsillie, should look at its own mistakes.

By Eric Zeman InformationWeek
January 04, 2012 09:33 AM

Research In Motion's board of directors is preparing a shake up the BlackBerry-maker's governance structure as soon as the end of the month, according to the Financial Post, a Canadian newspaper. The general reaction to the news across the Web following the report was "about damn time." However, the board's actions may be too little too late.

The action comes as RIM faces increasing pressure from investors for change. RIM's stock dropped 75% during 2011. Investors have a right to be angry. The number of missteps taken by co-CEOs and co-chairmen of the board Lazaridis and Balsillie are too numerous to count.

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The most recent gaffe is a significant delay in the company's planned next-generation smartphone platform, BB 10. Instead of launching new phones by the second quarter of 2012 as promised, it now looks as though the new platform won't be ready until the end of the year. RIM's co-CEOs say the delay is due to the availability of certain processors, though some insiders claim differently.

Worse, time and again Lazaridis and Balsillie have demonstrated that they are completely out of touch with the pace of innovation and change within the dynamic smartphone market. They are in complete denial about the problems facing RIM, and continue to point to a brighter future that never seems to appear.

[ Find out 5 Mobile Things That Won't Happen In 2012. ]

RIM's CEOs have been under pressure since before the middle of 2011, when the PlayBook tablet launched. By June, investors were calling for change. Lazaridis and Balsillie were somehow able to quell a potential investor revolt by agreeing to a review of the company's governance structure. That review is set to offer its recommendations by the end of January, and could effect change within days or weeks once it is complete.

Anonymous sources cited by the Financial Post suggest that Lazaridis and Balsillie will be stripped of their co-chairman roles and the company will appoint a single chairperson (believed to be Barbara Stymiest, an independent director who joined RIM's board in 2007).

This is a start, but it doesn't go nearly far enough. Boards are typically in charge of hiring/firing CEOs. Lazaridis and Balsillie have managed RIM straight into the ground with warmed-over new smartphones, delayed launches, and botched products. I can't imagine any other CEOs keeping their job with such a track record.

If RIM's board doesn't also seek to replace the co-CEOs with a single, new leader, they aren't acting in the best interests of RIM's investors. That makes them just as culpable for RIM's performance as Lazaridis and Balsillie, in my book.

According to our Outlook 2012 Survey, IT should expect soaring demand but cautious hiring as companies use technology to try to get closer to customers. Also in the new, all-digital issue of InformationWeek: Inside Windows Server 8. (Free registration required.)

My first thought when i read that the co-CEOs were going to lose their Chairmen position was that the board would vote to have them removed altogether shortly after. Without any authority on the board, there would really be nothing to keep them from being fired.

Originally Posted by Sith_Apprentice

My first thought when i read that the co-CEOs were going to lose their Chairmen position was that the board would vote to have them removed altogether shortly after. Without any authority on the board, there would really be nothing to keep them from being fired.

This is probably a possibility. It might have been best for those two to have actively relinquished their CEO roles and retain their board appointments. Then they could have officer positions but get a great CEO in place.

Reduce them from CEOs to CMO (if you like) and Executive VP of Engineering. At least put them in roles where they will not be in the spotlight and will be able to do what they had done so well in the past.

Originally Posted by Sith_Apprentice

Reduce them from CEOs to CMO (if you like) and Executive VP of Engineering. At least put them in roles where they will not be in the spotlight and will be able to do what they had done so well in the past.

I say send Jim packing to the used car dealerships where his strengths could be fully utilized (he's the marketing guy now and it is awful), and keep Mike as the VP of Engineering like you say. Jim just doesn't provide any value and his outlandish statements that never materialize have killed RIM's credibility.

Originally Posted by lnichols

I say send Jim packing to the used car dealerships where his strengths could be fully utilized (he's the marketing guy now and it is awful), and keep Mike as the VP of Engineering like you say. Jim just doesn't provide any value and his outlandish statements that never materialize have killed RIM's credibility.

I tend to agree with you on this one, Inichols. Keep the founder and let the other go.

Originally Posted by lnichols

I say send Jim packing to the used car dealerships where his strengths could be fully utilized (he's the marketing guy now and it is awful), and keep Mike as the VP of Engineering like you say. Jim just doesn't provide any value and his outlandish statements that never materialize have killed RIM's credibility.

So you're calling for a full emergency Balsillectomy then?

As a complete outsider, I would agree of the two he is far less credible. And since carriers are not very enthusiastic about RIM, and marketing has been weak, what good is he doing right now?

Is it me or is it possible that Jim, Mike and Jerry Jones are related somehow? Each of them has absolutely no clue that what they are doing is hurting their product.

Just a thought.

Originally Posted by lnichols

I say send Jim packing to the used car dealerships where his strengths could be fully utilized (he's the marketing guy now and it is awful), and keep Mike as the VP of Engineering like you say. Jim just doesn't provide any value and his outlandish statements that never materialize have killed RIM's credibility.

I tend to agree with this too.
I believe Jim B was hired from a construction company or somewhere when RIM was already on the rise and Mike L, who was a founding engineer, had a handful of day to day management.
I was listening to the RIM's conference calls etc and Jim B uttered nothing but a series of meaningless (yet harmful) defensive postures.
Mike L was the one who pioneered the 2 way paging system etc, and I am sure he understands the current state of the technology and why the industry is changing etc. far better than Jim B does.
Besides, Mike L looks to me is more sincere (often even cute). I remember his BBC interview when he cut it short and said something to the effect "it's not fair" or some such. I was appalled at the time but in hindsight, he was probably simply speaking his mind.

From what little I read about the make-up of the board they probably all suck :(

Right now they have a mission, to make the playbook a success and launch BB10 phones. They should focus on that.

Originally Posted by app_Developer

So you're calling for a full emergency Balsillectomy then?

Almost pissed myself!!