Life On BlackBerryResearch In Motion

Image source: RIM Annual Report

MGMT 619 – Capstone Project

June 4th, 2009

Lishuang Wu, May Chen, Wei Lii Tan, Robin Salim, Jin Choi

Blackberry Ecosystem

Source: CIBC World Market

Source: RIM Website

Source: RIM Website

Threat of Rivalry

High

Barrier of Entry

High

Role of Complement

sHigh

Supplier Power

Low

Threat of Substitute

sLow

Buyer Power

High

Ecosystem -

Factories& Outsourced Manufacturers

Semiconductor & Hardware

Providers Network SystemsProviders

Wireless Standards Committee

Content Providers

ApplicationDevelopers

Operating SystemProviders

End UsersBusiness

& Consumers

Network Carriers

Retailers

Mobile DeviceOEMs

Distribution& Services

Design & Platform Solutions

3rd partyValue AddSuppliers

& GlobalStandards

Factories& Outsourced Manufacturers

Factories& Outsourced Manufacturers

Semiconductor & Hardware

Providers

Semiconductor & Hardware

Providers Network SystemsProviders

Network SystemsProviders

Wireless Standards Committee

Wireless Standards Committee

Content ProvidersContent Providers

ApplicationDevelopers ApplicationDevelopers

Operating SystemProviders

Operating SystemProviders

End UsersBusiness

& Consumers

Network CarriersNetwork Carriers

RetailersRetailers

Mobile DeviceOEMs

Mobile DeviceOEMs

Distribution& Services

Design & Platform Solutions

3rd partyValue AddSuppliers

& GlobalStandards

Wireless Mobile Industry Ecosystem

Smart-phones:

e-mail, internet

Entertainment

Applications

Storage

Global Smart-phones

Market(2008):

high growth, 33% growth

High volume,138 million units

High revenue, $48 billion

High profit, 30% profit margin

Driving Forces:

Early adopters

Product rich features

Life management device

High speed networks

Global Region

Asia-Pacific

37%

Western

Europe

25%

North

America

21%

Others

17%

Vendor Market Share

43%

17%

8%

4%

4%

24%

Nokia

Research InMotion

Apple

HTC

Sharp

Others

OS Market Share

52%

17%

12%

8%

8%

2%

1% Symbian

RIM

MS WindowsMobile

Mac OS X

Linux

Palm OS

Other OSs

Focused Differentiation, Strong Contender, 245% growth

Leader in Brand, Design, Technology, Usability

enthusiastic customer base

International and enterprise expansion

Cost Leadership. Commodity handsets.

Still decent market share, leader in Asia

Broad Differentiation

Leader in the world (Europe and Asia)

Acquired Symbian OS

Cost Leadership,

Flexible mobile partner

Partnership with Google to introduce Android

Focused Differentiation,

Entrenched in enterprise, growing consumer base

Leader in Technology

#1 in U.S, International expansion

Windows Mobile

Key Value Drivers

Brand

Touch Screen

Screen size/resolution

Camera

Internal memory

3G

Gross Margin

RIM 51%

Apple 34%

Nokia 34%

Motorola 27%

Palm 30%

Threat

• Netbook, Media internet devices, VoIP

• OS platform war

• Low end smartphones

• Global economic downturn

Opportunities

• Social networking

• Application driven services

• Business applications

• Fashion identity

Implications to RIM

•Improve brand image

• Diverse applications

• Higher switching cost

• Attract high-end consumers

Board of Directors

Jim BalsillieChairman and Co-

CEO

Mike Lazaridis President and Co-

CEO

David WerezakVPEnterprise Business Unit

Mark GuibertVP

Corporate Marketing, Sales,

Finance

Don MorrisonCOO

Blackberry Wireless Solutions

Larry ConleeCOO

Engineering and Manufacturing

Robin BienfaitCIO

Blackberry Operations and

Corporate IT

Brian BidulkaChief Accounting Officer and Corp

Controller

Definition: A leading designer, manufacturer and marketer of innovative wireless solutions for the worldwide mobile communications market.Mission: Commitment to quality and a culture that embraces innovation, customer service and operational excellence.Vision: 'Always On, Always Connected' computing and communications.

Internal Analysis

Corporate Level Strategic Position Business Portfolio & Strategic Sourcing Framework

82%

13%

2% 3%

2008 Sales ContributionSmartphone Service Software Other

Blackberry Wireless Solution

Relative Market Share High Low

High

Growth Rate

Low

Corporate Level Strategic PositionBCG Matrix

Blackberry Pearl and Bold

Blackberry App. World

Business Level Strategic PositionProduct Segmentation

Device Target Customer

BlackBerry Storm Niche Consumer Market(Prosumer)

BlackBerry Bold Enterprise Market

BlackBerry Pearl Flip Mass Consumer Market

Resources and Capabilities

Value Drivers Cost Drivers Resource & Capabilities

Innovative Products R&D Top Management Team

Usability, Manageability, Security

Sales, Marketing, Distribution

Supply Chain Management

Brand Equity Manufacturing R&D

Customer Services Network Effect

Customer Services

Value Chain

Firm Infrastructure

Human Resources

Tech. Development

Procurement

INBOUND LOGISTIC

OPERATION OUTBOUND LOGISTIC

MKTG & SALES

AFTER SALES SERVICE

- Strong Management Team

- Innovation Culture

- In house R&D and Manufacturing

- Hiring practice - Weekly Vision training

- ISV and alliances

- Controller Sourcing

- Directly Negotiate Pricing

-Multivendor strategy

-EMS

-Flex production

-Supply Chain integration

- Strong R&D team

- Licensing and Patents - RIM OS and enterprise solutions

- 475 partners in 160 countries

-5 customer support centers worldwide

-Multilingual

VRIO AnalysisResource

Resource type

Valuable?

Rare?Hard to imitate?

Can be exploite

d?Implications

Relationship with corporations Business YES YES NO YES TEMPORARY

Carrier and distributor partnerships Business YES NO NO YES TEMPORARY

Network effectsBusiness/

Operational YES NO NO YES TEMPORARY

Blackberry Brand Marketing YES NO YES YES SUSTAINABLE

Proximity of R&D and Manufacturing Operational YES YES YES YES SUSTAINABLE

RIM company culture Operational YES NO YES YES SUSTAINABLE

First mover advantage Operational YES YES NO YES TEMPORARY

RIM Customer Service Centers Operational YES NO NO YES TEMPORARY

Blackberry Network Shadowing

Infrastructure Technical YES YES YES YES SUSTAINABLE

Blackberry enterprise server

Technical/Business YES NO NO YES TEMPORARY

3rd party developer network for

blackberry push technology

Technical/Business YES NO YES YES TEMPORARY

Partnership with Hewlett-Packard

Technical/Business YES YES NO YES TEMPORARY

RIM’s 4P’sProduct

Price

Placement

Promotion

Blackberry Model Bold Storm Curve Pearl

Undiscounted retail price $499 $499 $499

Price not

available

Service Provider Price

with 2-year contract

VerizonNot

available $199 $169 $119

AT&T $399Not

available $249 $149

T-MobileNot

availableNot

available $249 $179

Online and traditional retailers, wireless service providers

RIM: http://na.blackberry.com/eng/. (Pull Strategy)Service Partner: Verizon(Buy one get one free), AT&TViral Marketing: Youtube, blogs (crackberry.com, rimarkable.com)

Financial AnalysisIncome Statement

Balance Sheet

Cash Flow Statement

Strategic Effectiveness Analysis

Lifecycle

Apple-iPhone

Network Shadowing &

AppWorld

Strategic Effectiveness Analysis

Resources

Potential Issues

Recommendation & ImplementationShort Term Recommendation

Implementation

• Customer Loyalty Program• Accelerate 3rd Party Apps• Target Customer Oriented Market

• Target Customer Oriented Market 1. Collaboration between marketing, R&D and manufacturing team to improve industrial design. 2. Set financial objectives and align pay structure. 3. Branding and marketing campaign. 4. Sales readiness.

Long Term Recommendation

Implementation

• Integrate Laptop functions with Business oriented Apps• Expand into On-line game market: “Game-berry” • Add “Green-Berry” features

• Add “Green-Berry” features 1. Introduce “green” as part of corporate culture 2. Collaboration between marketing, R&D and manufacturing. 3. Alliance with component suppliers