Research In Motion (NASDAQ: RIMM) did not pick Bob Mansfield, Apple’s head of hardware operations, to act as its new CEO. It did not pick Philip Schiller, Apple’s long-time marketing chief. RIM did not hire a senior executive from Samsung, which has had such great success in the smartphone and tablet PC markets. Instead, it picked COO Thorsten Heins, who has been at RIM since December 2007. That was just before RIM’s stock hit its 2008 high of $150 and began its nauseating plunge to its current level of $17.
By nearly any reasonable measurement, because of the length of his tenure and management seniority, Thorsten Heins is as much a part of RIM’s problems as he possibly could be it solutions.
Heins worked at RIM’s top tier as the company lost its lead position among the world’s smartphone makers. He was COO when RIM stumbled in the tablet PC market with its PlayBook. He helped run RIM through service outages last year that lasted three days. He has been part of the management team that allowed RIM to be flanked by Apple (NASDAQ: AAPL) and an army of Google (NASDAQ: GOOG) Android-powered devices from companies such as HTC and Samsung.
RIM has not really changed its management at all. Mike Lazaridis, former co-chair and co-CEO, has become vice chair of RIM’s board and chair of the board’s new Innovation Committee. He will remain a daily presence at a company he has ineptly managed for years. Jim Balsillie remains a member of the board. Outside shareholders can fairly argue that the two men responsible for the demise of RIM have not been banished. The two may not even change the locations of their offices. That makes it impossible for Heins to quickly put his mark on RIM, and RIM needs a new mark immediately, if it is not too late already.
Investors should be stunned by the Heins appointment. They should be rattled by the fact that Lazaridis and Balsillie will remain on the board. They should believe that Heins has only the most modest ability to set the company on a new course and, as member of senior management for years, he was part of a group that made and carried out RIM’s flawed strategy.
Investors have hoped that RIM would be sold, because it is no longer a viable standalone company. It is losing its core business too quickly and will not have new products in the market until the end of this year. Instead, Wall St. is given Heins, who cannot claim that he his the right person to take RIM in a new direction because he has been such a critical part of the old one.
Douglas A. McIntyre