Last Updated Sep 28, 2010 1:13 PM EDT
Although RIM had faltered in the smartphone market, failing to keep pace with Apple (AAPL) and Google (GOOG) and disappointing with the BlackBerry Torch, company management demonstrated that it can recognize a market opening and take strategic advantage. Here are seven lessons that executives at other companies should take to heart:
- Recover from major mistakes -- at the right time. RIM has made a lot of mistakes in letting Apple and Google get significantly ahead in smartphone design. It tried to remedy those slips with the Torch, but it would have been almost impossible to not just catch up, but get ahead in one leap. However, given RIM's corporate focus and the lack of shipping tablets designed for that market, the PlayBook was well timed to make up for lost ground.
- Learn from competitors and then innovate to improve. Using the Torch again as an example, it isn't enough to simply catch up with a competitive offering. You need to give customers a reason to prefer yours. RIM saw how the iPad had some significant weaknesses for its particular market and aimed at filling those gaps to get ahead.
- Move from product history when strategy says you must. Too many executives are tied to their companies' pasts and spend resources trying to defend them. When Steve Jobs returned to Apple, he had the company dump the Mac Classic operating system and instead develop Mac OS X. RIM made the same decision by acquiring QNX and using that as the operating system of the PlayBook. And still, the company ensured a tied between the old and the new to avoid alienating customers.
- Define and defend your core customers. For some time, RIM had tried to go after a general consumer market. It wasn't an entirely foolish move, as its core business customers are also consumers. However, when resources are limited, you have to pick your battles. Make them the ones that count with the markets that are most important to you.
- Give customers new reasons to stay with you. There is a cost for customers to switch business from one vendor to another. In the case of high tech, a customer might need different applications, would have a learning curve for a new interface, and old accessories would probably no longer be compatible. In other industries, the costs may be different, but they exist. Customers balance the expense of switching against opportunities, abilities, and experiences lost by staying with the old. Give at least enough to whittle down that list of what your customers would gain with a switch and you can tip the scale back in your direction.
- Remember customers have other aspects to their lives. Including strong gaming capability acknowledged that people in companies also have interests outside of work. This is a smart form of market expansion -- not going after someone new, but, instead, pursuing aspects of existing customers that were once beyond your grasp. The result should be a stronger bond with them and additional opportunities as they can now provide positive word of mouth.
- Understand the difference between market share and profitable business. For some time, RIM chased the general consumer smartphone market. Given its size, you can understand the appeal. However, the company hasn't the resources of an Apple or Google. Market watchers usually push for never ending growth and dominance, but there is no reason to let them send you down a fruitless path. Pick a business your company can develop and hold.
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