10 Steps BlackBerry's Leadership Is Taking to Complete Turnaround Plan

 
 
By Don Reisinger  |  Posted 2016-02-08 Print this article Print
 
 
 
 
 
 
 
 
 
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    10 Steps BlackBerry's Leadership Is Taking to Complete Turnaround Plan
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    10 Steps BlackBerry's Leadership Is Taking to Complete Turnaround Plan

    BlackBerry's turnaround strategy has been slow, but the company is sticking to it. Here's a look at what BlackBerry is doing to return to profitability.
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    CEO John Chen Is Sticking to His Turnaround Plan
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    CEO John Chen Is Sticking to His Turnaround Plan

    BlackBerry CEO John Chen made his name turning around Sybase in the 1990s, which may make him the best person to lead BlackBerry. Chen, who became BlackBerry's chairman of the board and CEO in 2013, knows the enterprise market well. He has said in several earnings calls that his strategy is slowly, but surely fixing the company's woes and that he is sticking to that plan. Chen is central to BlackBerry's potential turnaround, even if investors are concerned that the turnaround isn't happening quickly enough.
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    Multiple Layoffs Have Reduced Payroll Drastically
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    Multiple Layoffs Have Reduced Payroll Drastically

    Unfortunately, BlackBerry has been forced to use layoffs to cut expenses and help its ailing financials. In addition to the 200 people BlackBerry just cut, it has already slashed its workforce to its goal of about 7,000 people. To put that into perspective, in 2011, BlackBerry had more than 17,500 employees.
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    BlackBerry Embraces Android, Moves BBM to Other Platforms
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    BlackBerry Embraces Android, Moves BBM to Other Platforms

    BlackBerry has embraced the idea that it's part of a broader mobile ecosystem. The company has brought its applications, including BlackBerry Messenger, to other mobile operating systems. In addition, it has added support for Android apps to BlackBerry 10 and even launched an Android-based device in the BlackBerry Priv smartphone. BlackBerry no longer adheres to a business plan focused on proprietary phone technology
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    The Enterprise Is Crucial
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    The Enterprise Is Crucial

    For a while, BlackBerry tried to be all things to all people, including consumers. Chen, however, realized the idea was a bad one and shifted focus. Now enterprises are the primary focus of its product designs and application packages. Looking ahead, BlackBerry is counting on enterprise users with their interest in communications security and business applications to keep buying the company's mobile products.
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    BlackBerry Will Continue to Support Physical Keyboards
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    BlackBerry Will Continue to Support Physical Keyboards

    Physical keyboards live on in BlackBerry's world. Although nearly every other device maker has nixed physical keyboards in favor of touch screens, BlackBerry believes there's a market for smartphones with keyboards. Whether there actually is may be debatable. But at least for now, there appears to be little chance that BlackBerry will entirely give up its physical keys.
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    The Company Won't Abandon BlackBerry OS
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    The Company Won't Abandon BlackBerry OS

    There has been some speculation of late that BlackBerry will turn its back on BlackBerry 10, its mobile operating system, and just move to Android. To end all speculation on those rumors, the company posted a blog recently reaffirming its support for its mobile OS. It seems the operating system still matters to BlackBerry, despite it losing significant market share to iOS and Android over the past several years.
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    Strategic Acquisitions Play a Role
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    Strategic Acquisitions Play a Role

    BlackBerry hasn't shied away from strategic acquisitions as part of its turnaround plan. The company acquired corporate-focused mobile device management company Good Technology last year for $425 million. Also last year, BlackBerry acquired enterprise data synchronization company WatchDox and networked crisis communications firm AtHoc for undisclosed sums.
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    The Company Sold Off Real Estate to Raise Cash
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    The Company Sold Off Real Estate to Raise Cash

    To boost his company's cash coffers, John Chen decided to sell noncore assets. For instance, Chen sold BlackBerry's many real estate holdings across Waterloo, Ontario, where its headquarters are located. Chen told investors that the cash would be used to make strategic acquisitions and other moves, and at least some of that cash was used in BlackBerry's aforementioned acquisitions.
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    BlackBerry Will Monetize Patents
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    BlackBerry Will Monetize Patents

    While speaking at the Waterloo Innovation Summit last year, Chen said that BlackBerry's patent portfolio could come in handy. He said at the time that BlackBerry owned approximately 44,000 patents and most of the patents won't expire anytime soon. What's more, those patents cover meaningful mobile innovations in the industry. Chen said at the time that the "monetization of our patents is an important aspect of our turnaround."
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    BlackBerry Isn't Playing Catch-Up With Apple, Google
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    BlackBerry Isn't Playing Catch-Up With Apple, Google

    Chen has said on numerous occasions that he has no interest in trying to play catch-up with Apple or Google and that comparisons between those companies and BlackBerry mean nothing. BlackBerry solely wants to appeal to enterprise users hoping for a high-quality user experience across hardware and software. It also wants to lead the market in mobile security. BlackBerry long ago gave up trying to be a leader in terms of mobile device sales or market share.
 

Over the last three years, BlackBerry has lost approximately $6 billion and watched its revenue plummet from $18.4 billion in the fiscal year ended March 2012 to $3.3 billion past year. The company was pummeled by the rise of the iPhone, iOS and Android and the touch screens they ran on, drying up demand for BlackBerry's iconic phones. This has brought years of leadership shakeup and layoffs as the one mighty mobile phone company was brought low. On Feb. 5, BlackBerry announced that, contrary to an internal memo leaked last year that the corporate downsizing was over, it terminated about 200 employees across Canada and Florida. A separate report from news site MobileSyrup suggests that number could rise to as many as 1,000. Whatever the case, BlackBerry argued in a statement to the media that the layoffs are a necessary part of its "turnaround plan." Questions remain, however, over when that turnaround may actually yield solid results. This slide show covers BlackBerry's prolonged turnaround efforts that executives say will ultimately return the company to profitability.

 
 
 
 
 
Don Reisinger is a freelance technology columnist. He started writing about technology for Ziff-Davis' Gearlog.com. Since then, he has written extremely popular columns for CNET.com, Computerworld, InformationWeek, and others. He has appeared numerous times on national television to share his expertise with viewers. You can follow his every move at http://twitter.com/donreisinger.
 
 
 
 
 
 

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