Strategic Management

SYMMS
2013-15

Keyboard lovers Bemoan Their Own as Blackberry In Trouble

Case Study

TEAM MEMBERS
Name

Roll No.

ROOPDIP MUKHOPADHYAY

82

ABHISHEK SHARMA

90

CHRISTOPHER REBELLO

81

SUMMARY
Blackberry the company which brought the QWERTY keyboard to the market has been facing a
rough time in all markets around the world from the last few years.
Blackberry reported a quarterly loss of $1 billion dollars. Business Analysts think that with such
heavy losses Blackberry might have to exit the market. In the last few years most users have
switched to touchscreen mobiles. BlackBerrys failure to keep up with Apple, Samsung,
Motorola and Google was a consequence of errors in its strategy and vision. First, after growing
to dominate the corporate market, BlackBerry failed to anticipate that consumers not
business customers would drive the smartphone revolution. BlackBerry insisted on
producing phones with full keyboards, even after it became clear that many users preferred
touchscreens, which allowed for better video viewing and touchscreen navigation.
Integral security features and an ever-expanding administrative toolset have earned
BlackBerry products the trust of some of the most secure organizations in the world. These
security features have also made the BlackBerry solution a world leader in mobile security
certifications. Black berry may have to contend with Knox a set of security features developed
by Samsung for android platform aimed at professionals, government and corporate users.
The loss reported by Blackberry reflected a $934 million write down of a growing inventory of
Blackberry Z10 phones as well as $72 million in charges related to layoffs. The $ 1.6 billion in
revenue during three month period that ended August 31 was way below the $ 3 billion target
which analysts had expected and it reflected a 49 percent drop from the first quarter.
Blackberry has three key business platforms: devices, enterprise services, and BBM. According
to Technology analyst, Jack Gold BBM unit would be the most attractive for any potential
industry buyer.
As of now, BlackBerry is struggling to rebuild itself. Whether BlackBerry can rebuild itself again
or nor is something everyone is waiting to see.

I)

Is Joint Venture or buyout the only solution for Blackberry? Suggest a

turnaround strategy to keep the company afloat.

The company has for long trying its level best to launch products with its black berry keyboard
interface the physical QWERTY keypad. Blackberry is a one of a kind smart phone with
keyboard which enabled texting a breeze which has its place in a very niche segment of the
market but instead of that over the years it has been unsuccessful in the race of innovation and
development of new OS which is based on a more friendly and customizable eco system that is
Android. It has made quarterly losses which amount $1 billion which is crippling its operations.
One can easily draw out there is a failure in the 4 Ps of the company:a)Product: Black berry served the cooperate customers to a great extent it made day to day task
so much easier and it was the only phone which act a personal digital assistant. The product line
of black berry still tries to cope with these customers needs but nothing to offer to the
customers. There is no differentiation in the product offerings of Black berry as compared to the
other brands prevailing in the current market. The benefit it offers and how the customers life or
work will be improved if he or she buys what black berry offers is lost out as true positioning is
not done properly. From the application developers point of view if a phone has a keyboard the
application would have to be made specifically compatible for a smaller screen. Black berry
needs to move from the keyboard towards the operating system and phone functionality which it
could use a competitive sustainable advantage
b) Price: The price point in the case of its products as compared to the market leaders is high as
most of the phones being offered by the company are no doubt targeted at the elite class of
individuals with very specific requirements most of the phones available at a price point lower
than black berry meet these requirements with ease and at half the price. Hence pricing is a miss.
In the case of Blackberry it is essential that it directs its R & D towards developing better and
unique bundled OS which are secure and offer tamper proof. Black berry services which were
linked to their servers were highly appreciated by many of its users as it is secure and maintains
high level of SSL (Secure Socket Layer) network.
The following directives need to be considered by Black berry
1)
2)
3)
4)
5)

Cost cutting
Develop Blackberry User Interface on Android Operating System
Liquidate unwanted or obsolete assets
Focus on enterprise customers
Invest in device integration with android.

The benefits would be:

Increased Revenues from New Devices

Synergies in Services Revenues from Devices

Better brand perception

Niche player with Net Profits

Industry Analysis

II) As Samsung Electronics is the leading brand in Smart phones category what strategy
should it adopt to benefit from Blackberry?
Samsung smart phones have been leaders in sellings phones to elite and high end customers
with the fall of Blackberry they could augment their high products on with add on features that
of security and customization. Also over and above that they can position these products towards
ERP plugin options where in the elite class of cooperates can balance both business needs and
personal life needs all on the same phone without compromising on anything.

Main factors influencing the Smartphone industry:

i.

Relationships between platform leaders and hardware manufacturers.

ii.

Market demand and carrier support.

iii.

The decisions of a number of major players with regard to key transitions or

major trends.

Google control over Android OS.

Budget phones

Informed customers

Better benchmarking tools

Powerful phones and number of players in the market

New and untapped markets

III) Blackberry products are used by governments and large financial institutions around
the world to secure communications. How can Blackberry benefit from it?
Blackberry is the preferred enterprise phone with regards to cooperate customers as it meets all
work related needs the security encryption and secured services offered by blackberry act a
unique selling point for all its product. It is found that most of the delegates of various countries
and of various organizations use its products to carry out day to day activity stable operating
system and robust network has protected most of its users from security threats. But to
accomplish this focus on enterprise security, BlackBerry has to appear truly interested in the
enterprise. This means developing an application ecosystem that plays to its strengths, but the
apps that seem to emerge from BlackBerry don't do that. Instead all that seems to show up is a
trickle of games and entertainment packages that don't do anything for BlackBerry's loyal
customer base.
This means offering an infrastructure that remains secure, an ecosystem that offers business and
government users value they can't find elsewhere. The obvious question is how he plans to go
about accomplishing that. Catering to the needs of these enterprise customers is the base for
development of more business and this can only be done by generating awareness among the big
giants and governments about secure communication system. This is a very niche segment which
will help Black Berry sustain provided it focuses on developing a complete eco system which
provides end to end solution to these entities as cyber security is the need of the hour.
This is how Black berry can benefit:1)
2)
3)
4)
5)
6)
7)

An entire niche market to cater to

Monopoly in this niche segment
Retained and loyal customers
Competitive sustainable advantage
Brand building and higher turnover
Access to high priority clients
Secured market share