A valuable lesson from BlackBerry: When a company fails to do CX Research

What we can learn from RIM and the BlackBerry.

In September 2020, Blackberry's stock traded for $4.50 a share, down from its peak of $146.00. A drop in revenue no business or company wants to experience.?I didn’t enter the BlackBerry craze until 2005 when I began working for a large wireless provider.?I remember being intimidated by the device.?It wasn’t intuitive for me as a flip phone user.?After a couple of crash sessions with a peer, who also set the device up for me, I was checking my email in no time.

23 years later I asked: What happened to the iconic device with its QWERTY keyboard?

In 1999 RIM launched its first BlackBerry device. A snappy, fast, palm friendly mobile email device. Rebranded from the RIM 957, the BlackBerry 6750 ushered in a new era in mobile devices. Taking a strategic approach to marketing, RIM targeted high profile users: politicians, Wall Street, and early adopters.?With 00.in their hands, the BlackBerry became a fast status symbol.?RIM went public in 1999, raising $255 million in their first offering, followed by a second offering in 2000 which netted $900 million. Mike Lazaridis and Jim Balsillie, as co-CEOs, set forth to conquer as many markets as possible.

RIM faced a few challenges along the way. In 2000, a patent lawsuit was brought against RIM by NTP.?Instead of accepting a loss in the suit, RIM appealed the decision and ultimately settled the case in 2006 for $612.5 million - $589.5 million over the original award for $23 million. In 2002, the company cut 10% of its staff and expenses in the transition from direct to indirect sales - maybe a foreshadowing of future poor decisions to come??I knew none of this as I happily adapted to the device, checking email incessantly.

BlackBerry was heavily controlled by creators Lazaridis and Balsillie.?However, Lazaridis controlled the innovation and evolution timeline, and it progressed slowly.?This approach worked for a time as consumers enjoyed the iterations without feeling overwhelmed with new features or functionality. ?By mid-2007, RIM had nine million subscribers across 300 carriers and 120 countries - and an impressive net worth of $42 billion. With a radical redesign off the table for BlackBerry, Lazaridis chose instead to iterate.?Thus, the BlackBerry Pearl was created, adding basic multimedia and camera capabilities.?I still remember my first BlackBerry Pearl.?I was on a work trip to San Francisco when I took some of the first photos on that mobile phone, photos I still have today.

On January 9th, 2007, Apple would change the landscape of the mobile phone industry forever with the announcement of its first iPhone.?Steve Jobs highlighted the disadvantage of a static keyboard, noting how much space it consumed. He disparaged the fixed control buttons that worked the same for every application.?Apple transformed the fixed keyboard into a software solution: customizable and flexible. There when you need it, not when you don’t.?Sleek, innovative, remarkable.

At this critical point of evolution in the industry, Lazaridis made the mistake of siding with hardware.?His ego got in the way.?Unable to see the potential of software, unable to reimagine his company and flagship device, he led BlackBerry down a road that would ultimately lead to their end (Hicks, 2012).?A company built on innovation stopped innovating.?A company built around the end user stopped seeking to understand what their end user wanted in the future.?And so, the end began.

What I find to be the most glaring mistake here is the lack of research conducted to understand the experience of consumers, how they interacted with the product, and what improvements they wanted. There was no investigation into whether they liked typing on glass or not.?Lazaridis acted on his assumption alone.?BlackBerry ultimately failed to become a consumer-focused company, instead choosing to remain a wireless technology company co-run by a domineering electrical engineer.?Lazaridis saw limitation where Apple saw possibility. ?The consumer chose possibility.

RIM was stuck with an aging BlackBerry operating system, ruling out change. Blindsided by the iPhone, they began to lose market share in the US, Canada, and the UK.?Although other companies were equally blindsided, they were able to adapt to the competitive challenge iPhone brought to the market by retooling their operating systems.?A stagnant strategy served Blackberry just fine initially.?Slow to respond and in denial three years into the iPhone launch, they admitted to a poorly diversified portfolio and their lack of concern over it.?Still seeing enough success, they stuck with that keyboard until they couldn’t.

In 2010, RIM finally began the much-needed operating system refresh.?Too little, too late? Very much so.?In 2011, RIM admitted to their fatal strategic error of not responding to the innovation of the iPhone and Apple. The wireless carrier I worked for didn’t take Apple up on its offer of exclusivity when the iPhone launched, also a terrible mistake.?I remember sitting in the conference where they laughed at Apple for thinking consumers wanted a computer in their pockets.?Their outlook was short sighted. Shortly thereafter, the laughter cost both executives their jobs.

We looked on as Apple launched the iPhone exclusively on AT&T. We settled for our BlackBerry Pearls. After all, iPhone was a bad word. Desiring one was an even worse sin.?AT&T took its lumps while launching the iPhone.?Its infrastructure was put to the test and so were its financials, making it ripe for a merger with T-Mobile in 2010/2011.?Shortly after the launch of the iPhone, the Android OS was released.?Android became the band-aid for companies that didn’t have the iPhone. Something to latch on to in hopes of not losing everything.?

In 2012, after the failed launch of the BlackBerry Playbook, Lazaridis and Balsillie stepped down as CEOs. In 2015 BlackBerry announced the Priv, which would operate on the Android OS ‘lollipop’.?Between 2015 and 2017 BlackBerry launched several phones on the Android platform with the last in-house designed phone being the BlackBerry KeyOne.?

I bailed on the BlackBerry once Android was released. I wasn’t alone. Like so many around the world, once I left BlackBerry, I never went back. First an Android user, then on to iPhone.?Understanding your end user is critical.?BlackBerry stopped innovating but more importantly they stopped listening. Android and Apple continued even to this day.

Julie Dubuc EdD (ADD)

Julie is a doctoral candidate at the University of Pennsylvania. With over 20 years of leadership experience, she brings a wealth of knowledge in research design and deployment, leadership, management, employee development, training and leadership development to the Overture team.

Citations:

Hicks, J. (2012, February 21). Research, no motion: How the blackberry CEOS lost an?empire. The Verge. Retrieved June 14, 2022, from https://www.theverge.com/2012/2/21/2789676/rim-blackberry-mike-lazaridis-jim-balsillie-lost-empire

Wikimedia Foundation. (2022, June 10). Blackberry Limited. Wikipedia. Retrieved June 14, 2022, from https://en.wikipedia.org/wiki/BlackBerry_Limited