Will the New CEO of RIM Be the Cure for the Ailing Company?

By Ed Silverstein January 23, 2012

The new CEO of Research In Motion says the company’s management shake-up will not lead to a "seismic change" – a statement that has some analysts concerned for RIM’s future.

Thorsten Heins, who just was promoted to the top spot, said on Monday during a conference call that the company will not be broken up into smaller units and basically expressed confidence in its current strategy, according to a report from The Wall Street Journal.

The company, which makes the once-thriving BlackBerry, has been struggling to compete in the competitive and fast-changing sector. RIM has been losing out to smartphone rivals such as Apple and Samsung, according to TechZone360.

During the conference call, the CEO admitted the company has “hit a few bumps in the road” but he claims it is “stronger today for what we have gone through.”

The Berry Review reported that the new CEO added that RIM is doing much better outside of the United States. Marketing and execution are going to be major focuses for the company, and it will be “more consumer driven.” A new marketing leader will be added soon. In addition, RIM is focusing on consumers who switch from feature phones to smartphones.

In addition, Barbara Stymiest was named chairman of RIM as part of the management changes.

However, the management shake-up at RIM was not seen as a cure-all for the company’s ailments. The Wall Street Journal reported in a blog that “the stock is going nowhere, because it turns out that just getting rid of a couple of people doesn’t actually solve anything by itself. In fact, the new guy, Thorsten Heins, doesn’t sound like he’s going to do anything all that much different than the old guys, Jim Balsillie and Mike Lazaridis, did.”

However, one analyst, Jennifer Fritzsche at Wells Fargo, said she liked the greater focus on marketing and the message sent by the management changes, The Journal said. But Kevin Dede of Brigantine Advisors said Heins may be “complacent as well as complicit in the current massive smartphone market share losses,” according to The Journal. Tal Liani of Merrill Lynch also predicted there may not be a turnaround in investors’ confidence for the “near term until greater clarity is gained on the future direction of the company,” The Journal adds.

In addition, The Toronto Star reported if Heins is not planning to make changes “he will be gone within 15 to 18 months. He will be a transitional CEO and this will be a transitional board,” Jaguar CEO Vic Alboini told the newspaper. And Queen’s University business professor John Pliniussen told The Star RIM needs “someone who already has world-class marketing, product development and turnaround expertise versus someone who now gets to practice that in his first CEO role.” Heins is not that person, Pliniussen adds.

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Ed Silverstein is a TechZone360 contributor. To read more of his articles, please visit his columnist page.

Edited by Rich Steeves

TechZone360 Contributor

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