Business Report: BlackBerry Limited

Business Report: BlackBerry Limited Free Essay

Introduction

BlackBerry Limited is a Canadian telecommunications and related services company that has been operational since 1984, but it continues to lose its operational sustainability, especially in the smartphone market (Synnot 2012). Although the BlackBerry brand may be famous for smartphones and related software, the company also provides software for industrial applications and mobile device management. Currently, the company has a number of smartphones in the market, but it is making more money from software applications for both popular Android operating system and relatively rare BlackBerry operating system that is only available for use on BlackBerry devices. BlackBerry Limited continues to grow, especially with respect to the software development aspect of the business. Currently, BlackBerry holds small market share of about 3% in the US, with more than 4500 employees, over 10 million units a year in global sales and total assets of over $3 billion (Dunn 2016). While BlackBerry cell phone sales have dwindled and ranks poorly among global giants such as Apple, the Canadian technology company still has a strong foundation and can resuscitate its business under able stewardship.

 

Discussion of Issues

The Problem

BlackBerry Limited is amongst the oldest technology companies in the global market, and it would be expected that its experience would be at an advantage in relation to market performance. The company has, however, registered consistent reductions in turnover over the past few years, indicating a decline instead of growth. BlackBerry Limited recently reported a drop in revenue, total equity and total assets, while experiencing an increase in net income and operating income (King & Baatartogtokh 2015). The technology industry is growing, with innovations being the main industry drivers. It must, however, also be noted that the industry is very dynamic, and more start-up companies seem to gain recognition and grow exponentially compared to older companies that appear to lag behind with respect to innovation. Nevertheless, the growth in income simply indicates that the company is not completely on the decline. The smartphones may not be performing as well in the market, but it is clear that other products and services have been doing rather well. If the company is to focus its strategy on the right aspects of operations, then it is likely to significantly improve its numbers .

Causes of the Problem

The greatest challenge BlackBerry Limited faced is the industry within which the company is operating. The technology-based industry not only has fierce competition but also faces a very dynamic business context in which the needs of consumers radically change (Douglas 2014). BlackBerry’s problems are associated with the success of Apple Inc. In fact, Apple and other innovative cell phone manufacturers such as Samsung are responsible for setting the pace at which the industry develops; in most cases, this is a problem for less innovative players in the market. For example, it can be appreciated that the only reason Google is considerably larger than Microsoft is Google’s innovative culture. With more solutions available for day-to-day consumer challenges, people make more use of Google than Microsoft, thereby making one company more popular and, thus, larger in terms of revenue than the other.

Another potential cause of BlackBerry’s decline in performance is the uniqueness of its products in a market that are readily available. While most of the software under the BlackBerry brand can only be found at the company’s brand store, other operating systems have more open access applications that could be found on multiple locations on the internet (Jacobides 2013). Apparently, this false sense of freedom and exercising free will constitute the criteria with which consumers are choosing technology-based products. The application for a BlackBerry device may cost just as much if not less than that of an application for a Samsung device, but it is believed that since the Samsung’s software can be sourced from anywhere, such applications are cheaper than those for BlackBerry that must be sourced from the authentic app store.

The problems at BlackBerry Limited are generally related to customer perception and cost. The customers generally presume that the BlackBerry brand would be high-end and, thus, too expensive in all contexts (Park et al. 2012). In reality, the expenses may not necessarily be connected with pricing strategies but more with availability with respect to the company’s applications not being easily accessible. Limited possibility to download applications may in one way or another prove unreasonable for a consumer who has the option of the Android OS.

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Potential Solutions

In order to address the current situation at BlackBerry Limited effectively, the two potential solutions include a focus on operational planning and products and services design. In regard to operational planning, the company needs to focus on activities that are relevant to the market in order to improve the sales. In terms of product and services design, BlackBerry Limited should promote innovation as it if it was its main concept if it aims to compete effectively with pacesetters such as Apple and Google in the technology industry.

Operations Planning and Control at BlackBerry Limited

BlackBerry Limited has had to cumulatively dismiss ten thousand or more employees in the last decade in order for the company to manage its operational costs. Apparently, this means that despite having very limited sales volumes, the company continued to run very high operational costs that were eventually considered unsustainable taking into account the company’s performance. Hereby, operational planning and control in this scenario are simply business procedures meant to ensure that the company is only spending money on activities that are likely to provide attractive returns on investment. The company’s management in this case has to adopt the organizational strategy and, thus, identify activities that contribute to the company’s income (King & Baatartogtokh, 2015). For example, the production and sales of older smartphone models is by far a waste of resources, considering that the consumer market is extremely dynamic. Similarly, the provision of support for older software versions is too expensive when the company could focus on new software versions. The control aspect, on the other hand, is related to ensuring that the employees comply with the set plan. Therefore, this implies implementing the right leadership systems to ensure that employees act accordingly to propel the organization towards its set goals and objectives.

Design of Goods and Services at BlackBerry Limited

This company currently needs a complete change of focus in relation to its goods and services. The smartphone market may be large and considerably sustainable; however, with a market share of less than 3%, BlackBerry Limited needs to focus on its software business and enterprise customers (Park et al. 2012). Software applications and business solutions for the business industry is a more lucrative line of business for the organization taking into consideration the company’s growing reputation on these fronts. The goods and services that the company designs must focus on consumers, with a specific requirement that all designs are created with the consumer in mind. Focusing on meeting specified consumer needs will enable the organization to provide solutions that are important to consumers rather than simply creating products and services to blindly compete with other firms in the market. Furthermore, narrowing focus will enable the company to invest in the right innovative projects for better organizational performance.

Conclusions

The main difference that this company must embrace is related to the market within which it operates. The BlackBerry brand has undergone a lot of changes in terms of value to the customer such that the company may not be able to recover much in the smartphone consumer markets without impressive innovations that it may devise. Android, Apple and more recently Windows have so far overwhelmed an exceedingly large market of operation systems for mobile devices, with most users opting for popular systems due to ease of use and the possibility to share media among other things. Instead, BlackBerry Limited must focus on software engineering and business solutions for its enterprise customers. Choosing the right line of business and focusing on it is the only way for the company to recover with relevance to the assets, revenue and equity. The consistent income growth should be a sign that the company is doing well in specific aspects of its business, hence the need to effectively plan and control operations.

Recommendations

  • BlackBerry Limited should abandon the smartphone business. Companies such as Samsung and Apple may continue struggling for the smartphone market because these are their primary sources of income, and so far, they have gained a significant percentage of the market through customer loyalty. The BlackBerry brand is in the sidelines, and yet the industry is not a cheap one. The company has to spend a lot on research and design in order to devise marketable products.
  • Focusing on services, especially with respect to the enterprise consumers, is a better line of business. The smartphone market may be larger than the business market, but BlackBerry has a better reputation for creating business solutions. This means that companies are more likely to trust solutions the company offer in their business operations rather than choosing a BlackBerry smartphone for personal use. It is important for the company to invest in the right projects in order to remain relevant in a highly dynamic market.
  • BlackBerry Limited needs to expand its activities in software and business solutions. The company is still more known for smartphones, despite having fewer smartphone models in the market. There are over 46 million BlackBerry subscribers, but this is minute compared to Android or Apple subscribers. Software applications and business solutions will cost the company less in research and design as it customizes solutions to its client companies.

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