How To Not Be the Next BlackBerry
“How did BlackBerry become the stepchild of the tech world?”
This simple question, casually posed to me last week, was a stark reminder of just how far this once-tech giant has fallen. Not that long ago, the BlackBerry was an essential staple of both the busy executive and the bustling socialite.
From Oprah to Kim Kardashian to President Obama, fans gushed over the device. The so-called smartphones were equally common both in corporate boardrooms and in VIP backrooms. And, these devotees said it never left their side. Even Google Executive Chairman Erik Schmidt, whose company’s Android platform directly competes with BlackBerry, was a loyal user.
At its peak, in 2009, it held nearly half of the US smartphone market share and its workforce was 15,000 strong and growing. Yearly earnings were on a steady clip to surpass the $2B mark (and would later surpass the $3B mark). The following year, the Canadian powerhouse was named the #3 rising brand by Interbrand, behind only Google and Apple. As a Product Manager during this height, it was an exciting time.
Today, BlackBerry is in a very different place. Its market cap of once more than $80B, now struggles to reach $5.5B. Multiple rounds of layoffs have paired down the workforce by more than 50%. Its US smartphone market share now hovers around 2%. And, in 2013, Interbrand dropped it altogether from its list of the top 100 best global brands.
Where did BlackBerry go so wrong? How did they not see their world changing, and what prevented them from being more responsive? How should they have been better prepared to adapt?
Five Essential Elements
From our experience with organizations, we have devised Five Essential Elements that are necessary for an adaptive organization. That is, an organization that is able to be responsive to a dynamically changing competitive landscape. Each element is presented below, along with questions so you can begin to assess the adaptability of your organization.
1. Distributed Responsibility
The responsibility of creating a nimble organization cannot rely on a few well-placed individuals. The burden is simply too large. Instead, it requires the collective effort of many, each bringing his or her unique perspective to the complex task of sensing and responding to the environment.
Similar to emergency brakes that are located in every train car, anyone must be able to sound the alarm when they sense that the organization is heading for a derailment.
BlackBerry had a very siloed structure and rigid expectations to play only in team sandboxes within your individual role. Employees that rebelled against this structure were considered renegades, tolerated only if they had recent successes. A common result was this structure was multiple teams in different parts of the company working on the same thing, many times unaware of one another.
In your organization:
How do you empower (and expect) people at all levels to be thinking about long-term viability?
How often are junior voices included in critical decisions
How is proactivity treated in your organization? Is keeping your head down considered just as risky as sticking your neck out?
2. Flat Organization Structure
In organizations that have a flat structure, there is less dependency on managers to be harbingers of decision-making. Instead, everyone feels an equal footing, equally apt to mobilize when a problem presents itself. This has been the most common driver in effectively distributing responsibility.
Organizations with multiple layers in the org chart typically expect important decisions to be made by managers who rarely have all the answers.
This forces managers to make judgment calls with incomplete information, especially a lack of perspective from the trenches.
What made execution particularly sluggish at BlackBerry was the requirement for decisions to be “sent up the chain”. There were ten layers between Product and top management. For any decision to be executed, each layer would have to be consulted and convinced. This extreme degree of consensus heavily relied on management input, a seemingly endless labyrinth that stymied innovation.
In your organization:
When making an important decision, how often do people “have to check with my manager”?
What percentage of time does the most senior person at a meeting speak first?
What mechanisms are in place to ensure that decision-making isn’t too centralized?
3. Tolerance of Uncomfortable Honesty
Every organization has its unspoken truths, topics that are considered too dangerous to actively voice. Suppressing taboo topics leads to stagnancy, complacency and even gridlock. This can be deadly when your world is constantly changing.
Organizations that can tolerate honesty, even if it is uncomfortable at times, address critical issues earlier.
However, in order to bear this level of sincerity, deliberate intention must be given to strengthening relationships. This is the case both amongst peers, as well as up and down the food chain. You will not be able to solicit the necessary level of frankness if individuals don’t have a foundation that gives them the freedom to speak openly.
The two most sacred topics at BlackBerry were battery life and the physical keyboard. It was unspeakable to discuss the thought of sacrificing battery life a more updated experience, even though this is precisely what the iPhone was showing us. When BlackBerry was forced to release a phone with an on-screen keyboard, it was apparent that sufficient investment hadn’t been made to make it a viable contender and it was soon discontinued.
In your organization:
Are there certain items that “we just don’t talk about”?
How are employees encouraged to voice uncomfortable truths without fear of retribution?
Is keeping the peace held to a higher regard than tackling an unresolved issue?
4. Rapid & Intentional Experimentation
There are no ready-made tactics to address a rapidly shifting environment. If there were a simple solution, it would have been quickly found and slapped on even faster.
The most effective strategy is to create a portfolio of experiments and iterate rapidly.
Each experiment will confirm or refute its hypothesis, generating valuable data that can lead to a more advanced experiment. Deliberate planning behind cohorts of experiments is necessary so they are adequately testing a variety of hypotheses, each being part of an “iteration generation”.
In your organization:
How much effort is spent trying to find “best practices” that are mismatched for your context?
Are multiple pilot projects running simultaneously to test the best course forward?
How are lessons from experiments built upon and incorporated into your organization?
5. Continuous Professional Development
What has gotten you here will be insufficient to get you where you want to go. In fact, your past success is often a handicap for your future success because it narrows your willingness to be experimental with a wide breath of options.
It is tempting to repeat tactics that have worked up until now because that is easier than having to learn new ones.
And, you’ve already proven they work, so they seem safe. However, it is only continuous learning that will keep you fresh and agile to recognize the new challenges being thrown at you. This is the only way to ensure sustained success.
In your organization:
Do all employees have an explicit development plan that links to incentives?
Are promotions paired with a development strategy for learning and growth?
How much time is set aside each month (free of other responsibilities) for learning?
If there is one thing that is for certain, the pace of change is only increasing. Rapidly shifting trade winds can lead any organization to join the has-been Hall of Fame with familiar names such as Sears, Kodak, Blockbuster and (likely) BlackBerry. Here, we have outlined the Five Essential Elements that enable an adaptive organization. How many of these elements do your organization exhibit, so that you will not only survive, but also thrive, in the face of disruption?
Obama with his BlackBerry (Credit: venturebeat.com)
BlackBerry's US market share was almost 50% in 2009; by 2013, it had dropped to 2.1%. (Credit: IDC)