While for many this is a major indicator that RIM is going out of business, the company is actually in a similar situation as Apple was when Steve Jobs came back and IBM when Louis Gerstner was hired. Not only were both of those companies successfully turned around, the efforts eventually resulted in companies that were stronger than ever, with Apple and IBM at near record valuations.
I followed the Apple turnaround closely and was part of the IBM turnaround myself, so let's talk about what it would take to fix RIM.
1. New Leadership Unafraid of Tough Decisions
When a company has fallen as far as RIM, the very first step is to bring on board a leadership team that can make the hard decisions. Generally this starts with the board of directors. If the board isn't structured to motivate or replace the executive staff, then the firm is doomed and the critical decisions simply won't be timely or effective.
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RIM should look for a board that has been through situations like this before, can see what must be done and staff the company appropriately. Sustained problems such as RIM's generally are tied to a board that it too weak, isn't engaged or doesn't have the proper experience-and if the board doesn't, or can't, step up, then the firm won't be turned around.
2. Aggressive Financial Triage So Execs Can Steer Ship
When you are having a meltdown, the most important person is the CFO. What you need is time, and if you can't substantially slow your losses, you won't get it. At IBM, even before Gerstner was hired, the board brought on Jerry York, who had helped turn Chrysler around; it was York's initial moves, not Gerstner's, which saved the company.
The CFO has to be willing and capable to do financial triage, cutting out the parts of the company that aren't useful and holding the parts that are critical to the firm's survival. He must also carry out very aggressive execution plans focused on slowing the bleeding to a point where the rest of the executive staff has time to do its jobs and dig out of the crisis.
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If everyone is always focused on the ship sinking, no one will take the time to pilot the ship out of the storm, and the ship will sink. Fixing RIM will mean removing the threat of immediate failure, or else too many people will focus on jumping ship and not enough will get their jobs done in order to save the firm.
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