BlackBerry Is Committed, Looking Forward, Says New CEO Chen

 
 
By Michelle Maisto  |  Posted 2013-11-14 Email Print this article Print
 
 
 
 
 
 
 

BlackBerry Interim CEO John Chen said in a public letter on the BlackBerry blog that there are tough decisions to make and he's ready to make them.

John Chen, the new CEO and executive chair of BlackBerry, is now in charge and ready to move ahead, he said in an open letter on the BlackBerry blog Nov. 13. 

"I know there has been a lot said about BlackBerry, but let me remind you that at BlackBerry, we are not dwelling on the past. We are looking towards the future," Chen said.

If the letter—or memo, really—is any indication, Chen's leadership style won't be impassioned or emotional but structured, positive, straightforward.

Far from the troops-rally "burning platform" memo that former Nokia CEO Stephen Elop wrote to staff, encouraging them to take a great leap with him, Chen set out a three-point agenda and made it bullet-point clear: BlackBerry is committed to reclaiming its success. Its commitment to its customers is unchanged. And, it's excited for the future, "and you should be, too."

Chen said that much has already been done, and there's still much to do.

"We have begun moving the company to embrace a multi-platform, BYOD [bring-your-own-device] world by adopting a new mobility-management platform and a new device strategy. We are also leveraging our tremendous assets, including BBM, our network and QNX," Chen wrote.

"While we are proud of these accomplishments, we know there is more work to be done. It's going to take time, discipline and tough decisions to reclaim BlackBerry's success, and we are ready for that challenge."

Neil Mawston, the U.K.-based executive director of Strategy Analytics' Global Wireless practice, says Chen "communicates well and appears decisive," both good characteristics in a crisis.

"We think Mr. Chen's strategy will focus initially on cutting costs, followed by enhanced smartphone and tablet designs, while trying simultaneously to stabilize or grow the customer base for its popular BBM, BES and QNX services," Mawston continued.

BlackBerry announced Nov. 4 that it was backing away from a $4.7 billion sale offer from Fairfax Financial Holdings, its largest stakeholder, to instead pursue a strategy that includes a $1 billion investment from a handful of investors—Fairfax the largest of them—and the hiring of John Chen to be "responsible for the strategic direction, strategic relationships and organizational goals of BlackBerry."

Chen, BlackBerry suggested in its announcement, will set the company right and then move on, leaving it in the hands of a capable CEO.

"Mr. Chen will serve as Interim Chief Executive Officer pending completion of a search for a new Chief Executive Officer," BlackBerry said.

That person might have remained Thorsten Heins, but it seems he found the overlap—the unknown amount of time during which Chen will be performing his magic—awkward.

"Thorsten did a very good job, given the hand he was dealt, but resigned because you can't have two people being in charge," Prem Watsa, CEO of Fairfax and now lead director and chair of the Compensation, Nomination and Governance Committee at BlackBerry, told The Globe and Mail, according to a Nov. 11 report.

"He said to me, 'It's very appropriate for me to resign. I like John Chen, but I'm CEO, and there is one person in charge," Watsa said, adding that no one directly asked Heins to leave. (Softening the blow for Heins will be a $22 million severance package.)

Chen: Initiate Turnaround

Chen's primary credential for the task ahead is the similar job he performed at Sybase. In the late 1990s, the company's stock was down more than 90 percent and it was struggling to get back in the black. Chen's (successful) strategy was to aggressively move into new niche markets. Fortune likened Chen to a corporate Evil Knievel.

Still, Gartner Research Vice President Carolina Milanesi says it remains to be seen whether Chen is the right person for the job.

"Judging by the blog post, he is saying the right things—no looking back, focus on customers. I guess this is at least an improvement from Heins' first communication when he was appointed, and said it was all about the marketing," she told eWEEK.

"Let's see what his first step is from an operations perspective," she added, "before we judge if he is the right man."

Ken Hyers, a U.S.-based senior analyst with Strategy Analytics, says a big part of Chen's job will also be to "reassure customers that BlackBerry is stable and will continue to offer its best-in-class secure messaging service long into the future. It won't be an easy job."

The next six to 12 months will be critical—Chen's "honeymoon period," adds Mawston. After that, "Investors will once again start pressing for concrete signs of recovery next year."

 

Follow Michelle Maisto on Twitter.

 
 
 
 
 
 
 
 
 
 
 
 
 

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