Managing Explosive Growth
January 20, 2013
Words Count: 4,590
Table of Contents
Analysis and evaluation4
Industry Key Success Factors6
Five Forces Analysis7
Corporate and Functional strategies10
Discussion of alternatives and key decision criteria11
Over the past couple of years, Research in Motion (RIM) experienced explosive growth in both its own entity and from competitors in the Smartphone industry. The key areas of RIM’s focus are its research and development (R&D) sector and its ability to keep producing state of the art mobile devices. As RIM plans for expansion to keep its significant market share on data devices, management needs to be concerned about the approach taken to protect its cryptographic and software source code, as this is a key reason that RIM enjoys a competitive advantage. There are four alternatives to consider in managing RIM’s explosive growth: 1. Do what we do now, only more of it
2. Grow and expand existing geographic locations
3. Increase acquisitions
4. Go global
In choosing the best alternative, certain criteria had to be met which included: * Increase recruitment of talent
* Increase research and development capabilities
* Maintain current unique organization culture
* Protection of intellectual property ie: source codes
* Financially viable
* Maintain competitive advantage
Going global is recommended to best address the labour shortfall experienced as a result of RIM's explosive growth. This alternative allows RIM to expand R&D and maintain a competitive advantage by creating opportunities to increase its recruitment of talent and protect intellectual property (IP). Past performance has provided the financial leverage for this expansion.
In the event the recommended strategy is not proving to be successful, RIM should focus on increasing acquisitions. This option is still financially viable, although more expensive than global expansion, but it will provide RIM access to talent pools to address its staffing issues and R&D concerns.
RIM is faced with a number of critical issues that must be addressed immediately. Research & Development
In comparison with the industry standard in 2007, RIM’s R&D expenditures as a percentage of revenue are less than its key competitors:
* Nokia (12.41% of the Revenue)
* Microsoft (20.49%)
* RIM (10.59%)
This is of concern, as the Smartphone market requires constant innovation by way of R&D to remain competitive.
Apple’s innovation in its mobile phone user interface has prompted a lot of design activity among competitors. As such, RIM requires a considerable R&D budget to compete. Retaining customers
The Smartphone industry is very competitive. RIM has traditionally targeted business users looking for a secure mobile device. With new entrants to the market, RIM's focused appeal may be insufficient to maintain a competitive advantage. Staffing Issues
RIM faces recruitment difficulties, which they attribute to a shortage of talent available in Waterloo. Attracting talent outside of Waterloo is difficult given the competitive software development industry. Growing demand from R&D is the greatest issue facing RIM. Without sufficient talent to keep innovation at a competitive level, RIM will lose its competitive advantage. Analysis and evaluation
Worldwide, the mobile phone industry is moving from a traditional telephone communication tool to a fully integrated e-mail, web browser, and organizer...