The Case of RIM (Black Berry), IBM and General Electric

In the case of Kodak, we had seen how an old company could be wiped out by changes, if they refused to change accordingly. Here, we will study another two similar companies, yet with different outcome.

RIM - Research In Motion
The provider of the BlackBerry, gadget that is quite popular among business people.

Take a look at the excerpt.

The problem with technology is that it is forever changing. RIM should have learnt the lessons suffered by many. Remember IBM? Well they used to rely on their mainframe business. Except there are only so many mainframes that can be sold. And there are only a limited number of companies which could invest in a mainframe. It was not until Louis Gerstner became CEO that the company realised that to survive, it had to find another business that would be sustainable and offset the significant drop in hardware sales. Cue services. Now IBM is unrecognisable from the organisation that Gerstner inherited. But it is much more profitable.

General Electric

General Electric is another company that has constantly reinvented himself. Jack Welch, its former CEO and the man credited with transforming the company, recalls in his book, Jack, of a meeting with the executives of GE's nuclear reactor business. The executives presented their business plan to Welch and confidently predicted that they would get orders to build three new nuclear reactors a year. Welch stunned them when he told them that he wanted a business plan with zero new orders and for the division to be profitable against that assumption. With no new product, the division did the only feasible option available to them — switch from a product-based business to a service-based business. It survived and went from loss making to being highly profitable.

From above strategies imply by IBM and General Electric, you may now have the clue of how to make a business longer lasting. No wonder big car companies like Mercedes is looking at options where they sell you the car once, and keep charging you for electricity through battery rental or servicing for their alternative / renewable energy vehicles.

Excerpt from What next for BlackBerry by Tony Pereira
http://www.thesundaily.my/news/259986

Follow up news:
Samsung says no interest in buying troubled RIM
"There's no merit (in Samsung buying RIM)," said Lee Sun-tae, an analyst at NH Investment & Securities. "An acquisition would enable Samsung to have its own operating system but the cost is too high. Samsung didn't buy HP's webOS either for the same reason... BlackBerry sales are collapsing and one plus one will not become two. http://biz.thestar.com.my/news/story.asp?file=/2012/1/18/business/20120118093057&sec=business