Strategic Management Assignment

capital of Vietnam UNIVERSITY FACULTY OF MANAGEMENT AND TOURISM -o0o- INTERNAL ENVIRONMENT ANALYSIS seek in Motion Ltd. Tutor Mr. Nguy? n Anh Quan Students Ph? m Thanh H? ng M? u Minh Tuy? n Vu Ng? c Anh split up Tutorial 3 Course Strategic Management Date 16/09/cc9 Word count 3, 261 words I. INTRODUCTION Besides external environs analysis, in order to craft a plausible corpse, the political bumpy has to take c are itself as salubrious, or in former(a) words, to carefully evaluate its resources and war-ridden position. In this report, we look into the case of Research in Motion Ltd. mouth) to deck this point. Firstly, we volition interpret readers with background knowledge of the company, fol upseting by appraisal of the companys current strategy. Then, the SWOT analysis is executed, and the weighted war-ridden strength judgments is considered. inhabitly, from the analysis, we provide the hear of issues and problems that merit front-burner managerial attention. II. BODY 1. follows background mouth was founded in 1984 by Mike Lazardis. base in Waterloo, Ontario, the company similarly has offices in jointure America, Europe and Asia Pacific. bound provides programmes and solutions for gateway to time- excellent information, including email, ph 1, Instant Messaging (IM), short message service (SMS) messaging, worldwide Positioning System (GPS), Internet and intranet-based coatings. sass is known primarily as the maker and provider of blackberry bush radio ruses and netmail services. It finish provide users with a piano tuner extension of their work and personal email accounts, including Microsoft Outlook, IBM sacred galvanic pileus Notes, Novell GroupWise and many Internet service provider (ISP) email services. back talk has lately chip ined 14 zillion subscribers worldwide and had provided oer $6 billion in revenue. In early 2008, RIM was one of Canadas largest companies with a commercialise place capitalization of $69. 4 billion. RIM had much than 100,000 opening move customers and an estimated 42% trade share of converged artifices. Revenues were contributed of importly by handheld sales (73%), followed by service (18%), packet program (6%) and unsanded(prenominal) revenues (3%). In 2007, 57. 9% of RIMs revenues were derived from the US, 7. 3% from Canada and the remaining 34. % from other countries. RIM had all over 270 carrier partnerships in more than 110 countries. In harm of mathematical product innovation, RIM has a wide range of product traffic pattern and innovation awards, including recognition from Computerworld as one of the Top 10 Products of the Past 40 Years. 2. Assessment of companys current strategy 2. 1 come withs strategicalal approach RIMs strategy focuses mainly on differentiating its products from those of competitors in order to serve a niche commercialise for championship class.In terms of differentiation, the blackberry wireless platform and line of handh elds include email, phone, IM, SMS, internet, music, camera, video, radio, organizer, GPS and a variety of other applications. blackberry bushs footling size, long barrage fire life, and ease of use, made the product passing popular with busy executives who set the safe and secure oral communication of collective mail. In fact, plaques that relied on sensitive information, such as the U. S. government and large financial institutions, were early and true adopters of blackberry and RIMs largest customers.RIMs enterprise e-mail servers, which were attached to the customers e-mail and IM servers behind company firewalls, encrypted and redirected e-mail and other data before forwarding the information to end consumers with wireless service providers (see Exhibit 3). RIM had more than 100,000 enterprise customers and an estimated 42 per cent market share of converged devices as mentioned above. 2. 2 Firms competitive scope RIM has a quite narrow geographical market coverage, mainly in the region of northeastward America, with the US market contributing 57. % of RIMs revenues, 7. 3% from Canada and the rest 34. 8% from other countries. The company competes in several industries, including wireless devices, software and service. In terms of revenue distribution, as mentioned above, handheld sales is in the first score 73%, followed by service 18%, software 6% and other revenues 3%. 2. 3 Recent jaunt position and performance In terms of competing against rivals, RIMs strengths firstly lie in the cogency to improve its products both in construct and technology.For example, RIM had recently introduced the award-winning Blackberry Pearl and Blackberry Curve, which were a significant design from old models and for the first time targeted both normal consumer and byplay professionals. RIM had a variety of product designs and innovation awards, including one of the Top 10 Products from Computerworld in the Past 40 Years. Recently, RIM has stepped up in advertising its product, wish images from celebrities like Madonna and Paris Hilton holding Blackberry in their hands. Especially, US President Obama were sighting using Blackberry device.Also, RIM is very gay to open their target market to younger consumers instead of their usual business consumers by launching Facebook, partnerships with software developers to bring popular games such as Guitar Hero II to the Blackberry unstable platform. A nonher illustration is that just six months after launching Facebook for blackberry bush, downloads of the popular social lucreing software application had topped one meg, indicating that younger consumers were gravitating towards the popular handhelds. all told these actions suggest a more aggressive move to the consumer, or at least prosumer, smartphone space.Whats more, RIM is expanding the number of product and technology victimization facilities in locations such as Fort Lauderdale. Geographic expanding upon is an essential strateg y, but it has its trade-off. We will talk more several(prenominal) this in the SWOT analysis. One of the appoint factor for RIM to win over competitors is in the field of R&D. RIM employed just over 2,100 sight with different R&D areas of expertise radio frequency engineer, hardware and software design,audio and queer improvement, antenna design, circuit board design, power management, industrial design, and manufacturing engineering, among others.R&D efforts focused on improving the functionality, security measures and performance of the blackberry solution, as intimately as developing reinvigorated devices for current and e encounter ne twainrk technologies and market segments. R&D had increase significantly both in terms of the total number of employees as well as the geographic scope of its operations. Since 2000, the R&D group had grown more than tenfold, from 200 to 2,100 people and expanded to two more locations in Canada. Additionally, by merging with competitors, RIM had over 270 carrier partnerships in more than 110 countries around the world. by dint of the Blackberry Connect licensing program other leading device manufacturers such as Motorola, Nokia, Samsung and Sony Ericsson could likewise equip their handsets with Blackberry functionality and other technologies. 2. 4. Evaluating the strategy 2. 4. 1 From quantitative standpoint In 2007 revenue increased by 98% from the previous year. Reached 14 million subscribers worldwide and had just over $6 billion in revenue (see Exhibits 1 and 2). Since 2000, the R&D group had grown more than tenfold, from 200 to 2,100 people, made up about 35 per cent of RIMs 6,254 employees. Total headcount had also been ontogenesis in double digits over the last five old age (see Exhibit 7). Low employee turnover rate and received Canadas 10 or so admired corporate kitchen-gardening. 2. 4. 2 Key indicators of how well the strategy is working Firms sale, market share and customers 14 million subscrib ers in 2008, nearly double than in 2007 with 8 million subscribers worldwide. $6 billion in revenue, doubling of that in 2007 (see Exhibits 1 and 2) 1/6 of the market share (Exhibits 8). RIM revenue compared with others For 4 age RIM revenue increased 10 times more from $595 million to $6,009 million, plot the leader Nokia almost double ( $46,606 million to $80,672 million), Motorola from $23,155 million to $36,622 million. apple from $6,207 million to 24,006 mil and Palm from $838 million to $1,561 million. Overall, RIM had the fastest ontogeny rate (Exhibits 6). As one of the first to market with two-way messaging, over the long time RIM has continuously improve its design and technology with award-winning models like Blackberry Pearl and Blackberry Curve.Also, good money is creation spent on investment in R&D to advance up with the change of the roving industry. This creates a good image and report card of the company to customers. 3. SWOT Analysis 3. 1 Strengths Prod uct innovation (a competence) The rationale of R & D Department at RIM is Communication Through Innovation. ? Products that imbibe the attention of both consumers and business professionals. Originally built for busy professionals, blackberry bush had made considerable headway in the consumer market and become something of a social phenomenon. CO-OP program with the University of Waterloo. CO-OP supplies business and industry with experience and contacts, as well as the opportunities to apply and pull down what is learned in class. World leader in Business sprightly Communications market ? One of the only trusted phones for the business-class wandering e-mail. As mentioned above, berry integrate e-mail, phone, IM, SMS, internet, GPS and a variety of other, in do-gooder to small size, long battery life, and ease of use making the product extremely popular with busy entrepreuners. Accumulated wide range of product design and innovation awards, recognition by Computerworld as T op 10 products of the bygone 40 Years. RIM had more than 100,000 enterprise customers and an estimated 42 per cent market share of converged devices, and significantly higher market share of data-only devices, in northeastward America. Secure delivery ? bug code is one of their few expert assets which is highly protected and is a identify role in the advantage of the company, delivering the safe and secure voice and data transmission on which the blackberry account was built.This can be considered as a distinctive competence of RIM. Strong working culture RIMs core competence. ? lodge culture has contributed towards a lower turnover rate compared to larger companies, and more happy employees. They confuse flexibility, adaptability and the ability to work collaboratively. There are not a lot of process or the kind of bureaucracy. 3. 2 Weaknesses dearth of physical space at RIMs Waterloo campus. It is considered as a hazard of a growing company since it is not going to b e conducive for expansion. Internal resistance to expand R&D to locations extracurricular of Waterloo. There are people here, even leaders and senior people, who tell What? Products being built elsewhere? No We cant do that Then we wont have any control So, some of it is a cultural shift and a mind shift for the people that have been there and it is hard for them to let go and to be part of a really big company. 3. 3 Opportunities Economic situation ? many another(prenominal) smaller debaucheds and technology start ups are struggling financially. ? In open-eyed of the dynamic market situation, RIM needs to ensure that its investment in R&D keeps up with the pace of change in the restless industry. Analysts predict an immense opportunity for smart phones starting in 2008-2009, which shipments gain the billions by 2012. There are not many trusted alternatives for business-class mobile e-mail. RIM could be one of the worlds biggest handset manufacturers in the future. 3. 4 T hreats Global economic downturn recently caused a lot of difficulties for all companies, and RIM is not taken into the exception. Explosive growth and increased argument on the R&D team to develop reinvigorated solutions in the global smartphones market. In 2007, Symbian Operating System knowing for mobile devices held an estimation of 65 percent worldwide share of the converged devices, shipping 77. 3 million smartphones. The second position was legislaten to Microsofts Windows expeditious OS with 12 percent while RIM Blackberry OS at 11 percent. Apple announced that it would be pursuing the business segment, as Microsoft and Google were also both trying. Apples innovation in its mobile user interface and raw technology (thermal touch screen) has created a new trend in mobile phone usage. This prompted a lot of design activities among competitors. Key competitors have already expanded globally while RIM is just on the way to be a global role player. As can be seen from th e SWOT above, RIM has a lot of strengths compared with its weaknesses. Its main problems that need solving currently are the expansion of the head delineate in Waterloo and the frightful competitiveness between competitors since there are day-by-day changes in technology that is considered as the matter of life and death for every player in mobile industry. When RIM becomes a global cell-phone producer, it has to face with the competition from giants such as NOKIA, Motorola, Apple, Palm, etc. . Weighted competitive strength assessment To do the weighted competitive strength assessment of RIM, we take 2 main competitors namely Apple and Nokia. In order to have a precise view, we would like to consider the competitive assessment merely in the biggest industry of RIM smart phones. The 8 key success factors that most affect industrys members to prosper in the marketplace are identified. Among them, qualified human resource and quality of the products are considered the most important, thusly get the weight of 0. 2. These are followed by the innovation to create new product, which is given 0. 15 weight.Reputation/image, financial resources, technological skills and product security are all rated as of medium importance, hence having 0. 1 weight. Last comes the customer service capability with the weight of 0. 05. pic From the assessments, it is seen that RIM ranks higher than its two competitors in terms of product quality and product security. However, the company is not as good as rivals in other aspects. Therefore, all things considered, the firm has a net competitive disadvantage versus major competitors, with the weighted boilers suit strength rating of only 6. 9 compared to Apples 7. 4 rate and Nokias 8. 5. 5. Strategic issues and problems that merit front-burner managerial attention later on careful consideration of both industry and competitive analysis, as well as the evaluations of the companys own competitiveness, we have come to the foreboding lis t that is further discussed below. This list points out strategic issues that the managers of Research in Motion need to address and resolve so that the company can be more financially and competitively successful in the years ahead. ? How to recruit and retain qualified engineers As mentioned above, R&D and engineering were the heart and soul of RIM.Therefore, the growth of the company is in close race with the development of its technological human resource. With the explosive growth of the firm, since 2000, the R&D group had grown more than tenfold, from 200 to 2,100 people. However, the industry is experiencing a scarceness in the labor market, especially for high-skilled workers, leading to fierce competition to attract geniused individuals. In the specific situation of RIM, because of its centralization in Waterloo, the company relies heavily on the labor supply of the region. However, this resource is strictly limited.On the other hand, the enterprise also faces threats f rom other companies, such as Microsoft or Google, as Waterloo is regarded as an incredible pool of talent. Attracting outside talent to Waterloo was difficult given the competitive nature of the global software development industry. The city of 115,000 people might not be perceived by some candicates to be as attractive as other sophisticated centers which were more cosmopolitan, for instance Silicon Valley, or Taipei, Mitaka, Glasgow. In software, breakthrough innovations practically came from small teams led by a visionary.In other words, although new graduates were essential, to be ahead of the game, a good proportion of the incoming employees for RIM was going to have to be senior hires. In the dynamic wireless communications market, exceptional software developers were scarce. From another perspective, similar to other players in the telecommunication industry, it is RIMs policy to maintain its R&D spending as a consistent percentage of total sales. R&D expenses are seen as a proxy for new product or service development, therefore used as a key indicator of future revenue potential.Human capital represented the good deal of R&D dollars and in fact, this rate is decreasing from 10. 59% in 2004 to 5. 99% in 2008. This is significantly low compared to rivals rate Palm with 12. 24%, Motorola with 12. 09% and Nokia with 10. 20%. As a result, the need to increase the R&D employees is crucial to the development of the corporation. ? How to solve the shortage of physical space at RIMs Waterloo This is another problem that needs attention from managers of RIM. The expansion of physical space is essential to satisfy the current demand of organizations people as well as facilitate the growing human resource. Whether to remain centered in Waterloo or expand breathing geographies Maintaining the centralization in its headquarter brings about various benefits, such as the nurturing of the corporate culture, or the control of technology together with core activi ties. In fact, the cryptological and software source code of Blackberry on which the brand reputation was built is considered uncompromised by the corporation. It is said by Chris Wormald, vice president of strategic alliences, that Our source code is really among our few enduring technical assets.We have gone through extraordinary measures to protect it. We dont give anyone any access under any circumstances. This vertical integration of technology makes geographic expansion and outsourcing of software development very difficult. Therefore, intellectual property rights is strategically managed through a strategy that divided core platform development from product and technology development, with most of the core work withal occuring in Waterloo. However, it is also concerned that without geographical expansion, the company can be left behind in its competition. How to maintain the laughable culture while expanding the company The culture at RIM headquarters was seen as one of its differentiators and was a key factor in RIMs low employee turnover rate. The company has recently been recognized as one of Canadas 10 Most Admired incarnate Cultures. This culture is described as flexible, adaptable and supportive, leading to the ability to respond quickly to market opportunities of the firm. Compared to its competitors, RIM has a nice and dynamic environment, a place engineers like to work. Nevertheless, this unique culture is being challenged.The exponential growth of the company means the salient increase in human resource, and how to integrate the newcomers into RIMs culture becomes an alarming question. Furthermore, when expansion of R&D is brought into consideration, internal resistance is also heard. People complained about changing in the strategy. So here a cultural shift for the people is required. ? How to compete with rivals in markets other than the North America In terms of operating system, RIM Blackberry is bedded the third worldwide, with 1 1% market share in 2007, and the first in North America. In the same year, 57. % of RIMs revenues were derived from the United States, 7. 3% from Canada and the remaining 34. 8% from other countries. Currently RIM had offices in North America, Europe and Asia Pacific, however, it had only three wholly owned subsidiaries two in Delaware and one in England. From this statistics, it can be seen that the main market of Blackberry is still North America. To compete successfully, RIM has to enhance its appearance and market share in other major markets as well. Expanding the global reach of Blackberry solutions is therefore a fundamental part of RIMs strategy.III. CONCLUSION From the internal environment analysis, we draw a conclusion that RIM is pursuing a reasonable strategy of focus differentiation. Its trend to move toward the consumer market is wise, promising to bring more market share and gelt for the company. However, because of its small size and limited resources compared to b ig players in the industry, it is somehow having a net competitive disadvantage. To further itself in the future, the company should enhance its strengths, belittle the weaknesses together with catching opportunities as well as eliminating threats.The worry list above should be considered carefully so that the company can be compete more successfully in the coming years. REFERENCE 1. Company Histories. Research in Motion Ltd. Online obtainable at http//www. fundinguniverse. com/company-histories/Research-in-Motion-Ltd-Company-History. hypertext markup language Accessed 20 August 2009. 2. Pkaasish, 2008. Research in Motion Ltd. Always on, always attached. Online forthcoming at http//www. oppapers. com/essays/Blackbberry/132559 Accessed 22 August 2009. 3. 2008. RIM Reviews in Waterloo, ON (Canada). Online Available at http//www. lassdoor. com/Reviews/RIM-Waterloo-Company-Reviews-EI_IE9091. 0,3_IL. 4,12_IC2280158_IP4. htm Accessed 30 August 2009. 4. PATRICIA BOW, 2008. BUSINESS no t as usual. Online Available at http//www. alumni. uwaterloo. ca/alumni/pubs/magazine/spring09/business/index. html Accessed 30 August 2009. 5. Arik Hesseldahl, 2006. BlackBerry vs. Redberry in China. Online Available at http//www. businessweek. com/technology/ core/apr2006/tc20060413_266291. htm? chan=search Accessed 30 August 2009. 6. Innovation, 2008. BlackBerry Innovation Behind the Icon. Online Available at http//www. businessweek. com/innovate/content/apr2008/id2008044_416784_page_2. htm Accessed 1 kinfolk 2009. 7. Singapore and Reading (UK), 2008. Smart mobile device shipments hit 118 million in 2007, up 53% on 2006. Online Available at http//www. canalys. com/pr/2008/r2008021. htm Accessed 2 September 2009. 8. Wikipedia, 2008. Smartphone. Online Available at http//en. wikipedia. org/wiki/Smartphone Accessed 3 September 2009. 9. BlackBerry Nation Sample Chapter. Chapter Two The Birth of the BlackBerry. Online Available at http//blackberrynationbook. om/index. php/BlackBerry_ Nation_Sample_ChapterFinancing_The_BlackBerry Accessed 2 September 2009. 10. Damian Francis, 2009. Screw You Economic Downturn, Were BlackBerry . Online Available at http//www. popsci. com/gear-amp-gadgets/article/2009-02/screw-you-economic-downturn-we%E2%80%99re-blackberry Accessed 6 September 2009. Exhibit 1 Note RIM financial year ends in March (Fiscal 2008 is the year ending March 31, 2008) spring RIM Fiscal 2007 annual Report and Fiscal 2008 Press Release (April 2, 2008) Exhibit 2 picpic Exhibit 3 pic 1.BlackBerry effort Server Robust software that acts as the centralized link between wireless devices, wireless networks and enterprise applications. The server integrates with enterprise messaging and collaboration systems to provide mobile users with access to email, enterprise instant messaging and personal information management tools. All data between applications and BlackBerry smartphones flows centrally through the server. 2. BlackBerry Mobile Data System (BlackBerry MDS) An optimized framework for creating, deploying and managing applications for the BlackBerry Enterprise Solution.It provides essential components that change applications beyond email to be deployed to mobile users, including developer tools, administrative services and BlackBerry Device Software. It also uses the same proven BlackBerry push delivery model and advanced security features used for BlackBerry email. 3. BlackBerry Smartphones structured wireless voice and data devices that are optimized to work with the BlackBerry Enterprise Solution. They provide push-based access to email and data from enterprise applications and systems in addition to web, MMS, SMS and organizer applications. . BlackBerry Connect Devices Devices available from leading manufacturers that feature BlackBerry push delivery technology and connect to the BlackBerry Enterprise Server. 5. BlackBerry Alliance Program A large community of independent software vendors, system integrators and solution prov iders that offer applications, services and solutions for the BlackBerry Enterprise Solution. It is designed to help organizations make the most of the BlackBerry Enterprise Solution when mobilizing their enterprises. 6.BlackBerry Solution Services A group of services that include BlackBerry Technical Support Services, BlackBerry Training, RIM Professional Services and the Corporate Development Program. These tools and programs are designed to help organizations deploy, manage and extend their wireless solution. Source http//na. blackberry. com/eng/ataglance/solutions/architecture. jsp Exhibit 4 picpic Source http//www. rim. com/newsroom/media/gallery/index. shtml and Fortune, BlackBerry ontogenesis of an icon, Jon Fortt, Sept 21, 2007, accessed April 7, 2008 http//bigtech. blogs. fortune. cnn. om/blackberry-evolution-of-an-icon-photos-610/ Exhibit 5 MOBILE TELEPHONE USERS WORLDWIDE (IN MILLIONS) pic Source Created from data accessed from the Global Market Information Database, Apr il 4, 2008, http//www. portal. euromonitor. com. proxy1. lib. uwo. ca2048/portal/server. pt? control=SetCommunity&CommunityID=207&PageID=720&cached=false&space=CommunityPage Exhibit 6 pic pic Note Nokia 2007 includes Nokia Siemens. Source Company Annual Reports. Exhibit 7 pic Source RIM Annual Reports. Exhibit 8 Market share of mobile operating system 2008 pic Source Wikipedia, the free encyclopedia