An Entrepreneurial Anecdote Worth Repeating… July 16, 2014
I recently read an article on Thomas Bata, the Czechoslovakian-born cobbler who became ‘shoemaker to the world' through his Toronto-based Bata Shoes.
Canada's Tech Sector and Immigration - Why it's Been Great July 15, 2014
It was recently reported that a number of US-based tech firms are hiring specialized internationally-sourced talent into their Canadian subsidiary offices rather than continue fighting with the quagmire that is U.S. immigration. This is good news for Canada ....
The difference between versatility and adaptability and why it matters when hiring executives. July 10, 2014
In the world of executive hiring, attributes such as versatility and adaptability are often used interchangeably when describing an executive's ability to enter a new employer, decipher the situation at hand, and deploy the right set of management tools to be successful.
Busting Entrepreneurial Myths July 8, 2014
Stumbled upon The Illusions of Entrepreneurship by Scott A. Shane. Though now a number of years old, the book's attempts to challenge common views on ‘entrepreneurship' remain relevant. While most of us associate entrepreneurship with the rich and famous world-beaters, Shane reminds us that the category includes infinitely more dry cleaners, variety store owners, cab drivers and even farmers. Consider some of the many tidbits the book offers:
Why startups look for cheap thoroughbred plow horses July 7, 2014
We are occasionally asked by clients to find candidates best described as thoroughbred plow horses. It usually starts innocently enough as with the following example…
The Cry to Replace RIM's CEOs
October 13, 2011
Leaving aside the recent service outages, the shellacking of RIM in the press is a tad surreal to behold.
For the few Luddites not familiar with the firm, Research in Motion is the successful Canadian smart phone pioneer with revenues of $20bb per year, no debt and cash in the bank. They manufacture products that remain popular around the world and continue to boast technological innovations unmatched by any competitor. Their most recently launched smart phone devices have been well reviewed and appear to be selling well. And though the company’s first version of its new tablet, the Playbook, has room for improvement, it is a promising piece of technology.
Yet despite RIM’s success the firm has faltered of late, most notably in its abject failure to continue delivering uninterrupted share price appreciation, to infinity and beyond, and it is being held to task. In fact, if you read the press you can be forgiven for confusing RIM for Nortel in its dying days. Headlines blare that the company is ‘horribly broken’, that it is ‘yesterday’s news’, and in need of ‘sweeping changes’. Articles indict the company for squandering its 60% smart phone market share against the likes of Apple and Google. They are accused of being technology laggards and of putting ‘all of their eggs’ into a no-name operating system produced by a recently acquired firm called QNX. And now the shareholder activists smell blood and are circling above. Jaguar Capital, for example has charged RIM with failing to ‘inspire consumer enthusiasm’ and argue that its co-CEOs need to be replaced with a more ‘transformational leader’. Perhaps, they also suggest, a yard-sale of the firm’s various pieces is also in order.
It is almost a law of nature that sooner or later gravity-defying tech sector darlings will morph into dogs. To its credit RIM has staved off that inevitability with a remarkable string of quarterly results that have placated even the firm’s most vocal cynics. It was only a matter a time however before the tides of growth slowed and investor sentiment went from euphoria to anger. But as the analysts and activists now scream that the sky is falling on RIM, shareholders would be very wise to think long and hard before reflexively dumping the company’s founding leadership duo. Here’s why.
First, a quick count might be in order of the people capable of building, in one generation, a successful $20bb per year technology firm. Don’t even bother looking in Canada because you are unlikely to find any. Once you have completed that napkin list, take a peek at Rod McQueen’s book Blackberry which will help you understand why Mike Lazaridis is one of those people. Here is a seriously talented guy with a brilliant track record of creating innovative, successful technologies across a number of fields. The man even won an Emmy and an Oscar for technical innovation in film editing, a little project he undertook before the company moved into the data communications field. And despite what is reported in the press, Mike Lazaridis is by any measure an ‘inspirational’ leader who likely remains passionate about his business and field. He is also sufficiently self-aware to have seen the value, early on, of complementing himself with an equally competent business alter-ego, one Jim Balsillie who has not done poorly either. Such self-awareness, by the way, is a good indicator that Lazaridis, if given the time, will continue to grow, evolve and learn. In any event, while they have encountered their share of bumps trying to scale such a fast-growing business in a complex global market, for the most part they have been gloriously successful. And before dismissing the firm’s acquisition of Ottawa-based QNX, it should be noted that this is a highly regarded company whose software is so good, so reliable and robust that it is the product of choice for nuclear reactor and automotive manufacturers around the world. RIM’s acquisition of this company was neither desperate nor ill-advised and to write it off as so many have already is beyond foolish.
If the shareholder activists genuinely want to replace Lazaridis and Balsillie with an ‘inspirational leader’, maybe they can give everyone a hint of where they are they going to find such a talent. Perhaps they plan to follow Nokia’s lead and uncover someone buried in the bowels of Microsoft, a firm that many would argue is in desperate need of similar inspirational leadership. Or perhaps they can recruit one of the four or five CEO castoffs who were brought in to inspire Hewlett-Packard or Yahoo over the past few years. Surely any of these people will be more innovative and inspirational than the team that invented the smart phone. Or, maybe they can hire one of the second-in-commands from a firm such as Facebook, Oracle or Google, all very capable executives who have helped (note the word helped) those firms’ brilliant founders execute and grow. Surely there is a wealth of tech sector executives with a better track record than these two guys at living up to shareholder expectations in a lightning fast moving segment such as wireless. Aren’t there?
If brilliance, innovation and nimbleness are what shareholders really want, do they really think they will get it by replacing world-class entrepreneurs with professional managers? More likely they will get efficiency, process, formality and planning, all at the cost of that very brilliance, innovation and nimbleness they so covet. Just ask Apple. What they will get with a professional manager however is better corner office alignment of interests in considering breakup and sales options for the firm. And this is likely the real play for the activists calling for change, the same play we witnessed last year at another Waterloo-based firm, Dalsa and at many others before it.
RIM has its challenges no doubt, but its co-CEOs have earned the right to be given the time to deal with them. The current panic calls for action are disproportionate and misguided. In fact, it could be argued that they are nothing more than the product of avarice cloaked in righteous shareholder indignation. If given the chance, those concerned shareholders claiming to want nothing more than to heal the ill patient will slit its throat for the cash value of its body parts.
About the Author
Robert Hebert is the founder and Managing Partner of StoneWood Group Inc., a leading executive search firm in Canada. Since 1981, he has helped firms across a wide range of sectors address their senior recruiting, assessment and leadership development requirements.
Contact Robert by email at firstname.lastname@example.org or call (1) 416-365-9494 EXT 777