RIM is a world leader in mobile communications that established in 1984. By 2008, RIM experienced explosive growth, with subscribers increasing from 8 million to 14 million. To maintain its competitive advantage, RIM believes R&D is key and should pursue strategies like increasing recruiting, expanding geographies, strategic acquisitions, and going global. Issues include how to maintain superiority and if current strategies are sufficient. RIM conducts external and internal analyses to understand its environment and resources. Externally, factors like regulations, economics, technology and legal issues impact RIM. Internally, RIM focuses on R&D and its culture. RIM forms alliances to capture new insights and experiences to increase its R&D capabilities

1. MM 5012
BUSINESS STRATEGY
GROUP SUMMARY
RESEARCH IN MOTION : MANAGING EXPLOSIVE
GROWTH
LECTURER :
DR. MOHAMMAD HAMSAL
DEVELOPED BY :
DERU R. INDIKA (29110301)
NISHAM FIKSRIYOSO (29110309)
ERIKA PARAMINDA (29110310)
JOSIA PRANANTA T. (29110345)

2. I. CASE SYNOPSIS
RIM is a world leader in the mobile communication market that establesihed on 1984
by 23 year old University of Waterloo student Mike Lazaridis. In 2008 RIM have an
explosive growth. On march 2008, their subscriber already increasing from 8 million to 14
million. RIM believe R&D is their strongest success factor. To keep their superiority
performance RIM should maintain their R&D by several strategy such as Increase their
capability in recruiting and maintaining their new staff, grow and expand existing
geographies, increase strategic acquisitions (find a potential company that will increase RIM
competitive advantage), Go global (build a subsidiary in other country that have strategic
advantage).
II. ISSUES AND PROBLEM IDENTIFICATION
The issues and problems that can be identified from RIM case can be seen below :
a. What should RIM do to keep the superiority?
b. Are their strategy are good enough to keep their superiority?
c. Could RIM maintain the resistance when applying their recent strategy?
III. ANALYSIS
3.1 External Analysis
The external analysis is conducted by using PEST analysis and Porter’s Five Forces.
(a) PEST Analysis
Field Explanation
Politic Most governments regulated the import and export of encryption product due to
national security issues.
 The US government would not purchase any product that had not passed the
Federal Information Processing Standards (FIPS) certification test.
 Data that encrypted in China should provided government the keys to access the
data.
 India government wants to eavesdrop to Blackberry user due to terrorist issues.
Economy  There is a depressed economic climate in the United States that made many smaller
firms and technology start-ups were struggling financially.
Social  Social phenomenon about blackberry that originally built for business professional
and reaches a bigger segment.
 Worldwide demand for wireless handhelds due to global trends.
 Broad acceptance of e-mail and text messaging as a reliable, secure and
indispensable means of communication.
 The need of instant messaging for business and personal communication tools.
 The worldwide recognition of China as a center of innovation.
Technology  Moving demand from cellphones to smartphones.
 Commercial availability of high-speed wireless networks.

3. Field Explanation
 Emergence of mobile access to corporate intranets.
Legal Source code loss, software piracy and product imitation were more common in
developing countries where IP protection laws lagged the US or Canada, lead to
explicit and tacit knowledge “leakage”. The launch of China product called “Redberry”
with wireless e-mail service.
(b) Porter’s Five Forces
Forces Analysis Attractiveness
Threat of New New technology in telecommunication and product imitation Unattractive
Entrants Description:
Due to rapid development in technology and technical leakage
issues, It is possible for other established company (even beyond
telecommunication industry) to enter the market then offering
new technology of telecommunication or doing imitation of
existing product
Bargaining More preferences for company Unattractive
power of Description:
suppliers Lot of suppliers can provide any instrument or part in term of
support the manufacturing, therefore the company has more
preferences to select the appropriate product based on
consideration of cost and quality
Bargaining Easy to shift to other products Unattractive
power of Description:
buyers The increasing market of smartphone make each provider
penetrate market by any differentiation such as device
preferences, customer care, software and accesories. These
occurrences make buyers are easier in shifting to other products
Threat of Threat of PC Tablet Unattractive
Subtitute Description:
Services Technology of smartphone is not unsubstitutable due to other
existing technology called PC Tablet that provide not only more
features in smartphone but also add some features inside in PC
Tablet characteristic
Rivalry among High competition Unattractive
existing Description:
competitors In worldwide market share, RIM’s Blackberry OS is under
Symbian and Microsoft’s Windows Mobile. Moreover, those
providers including Apple, Android and Palm which are
penetrate market -by each business strategy even more similar
action- make this competition of smartphone market segment
become high
3.2 Internal Analysis
Internal analysis is conducted by using value chain analysis and resource based view
(RBV) analysis.

4. (a) Value Chain Analysis
The value chain analysis is conducted by seeing RIM primary activities and support
activities.
Primary
Explanation
Activities
Inbound Most core work still done in Waterloo and Ottawa.
Logistics
Operations  R&D still done in Waterloo.
 Product and technology sites throughout the United States and United Kingdom.
Outbound  RIM offices in North America, Europe and Asia Pacific.
Logistics  Subsidiaries in Delaware and England.
Marketing  Sales and marketing representatives offices in France, Germany, Italy, Spain,
and Sales China, Australia, Hong Kong and Japan.
 Celebrity as brand ambassador.
 Partnership with wireless carriers such as Rogers and Verizon that bundled
Blackberry handheld and software with airtime.
 Improving relationship with large national reseller and on-line distribution while
also strengthening their old networks of carrier enterprises and retail channels1.
Service  Customer services in Singapore.
 Providing 24/7 support for Blackberry customers around the world.
 Increase the capabilities in the customer support group by including a professional
services organization, an extensive array of educational programs, incident-based
technical support team and operational excellence team that focused on regulatory
compliance, quality assurance and customer satisfaction.2
Support
Explanation
Activities
Firm  RIM has a company culture that was flexibility, adaptability and the ability to
Infrastructure work collaboratively that create a nice and dynamic working environment.
 RIM built company that focus on quality and has an embedded philosophy of “We
can do it better ourselves”.
 RIM headquarters are based in Waterloo.
Human  RIM recruits their people through local recruiting strategy especially in University
Resources of Waterloo and also a nationwide campus recruitment.
Management  Company relied heavily in the personal and professional network of existing
employees as an ear-to-the-ground approach in finding new talent.
 Doing co-op programs to other universities.
Technology  R&D was the heart and soul of RIM.
Development  Improve new application to be used in Blackberry, such as Facebook for
Blackberry.
 Push technology.
 Partnership with software developers to bring popular game, such as Guitar Hero
III.
Procurement The Blackberry Enterprise System that connect the Blackberry handheld with
Blackberry Enterprise System, Blackberry Mobile Data System (MDS), Blackberry
Connect Devices, Blackberry Alliance Program and Blackberry Solution Service.
1
RIM Annual Report, 2007
2
RIM Annual Report, 2007.

5. (b) Resource Based View Analysis
Resource based view analysis is conducted by seeing the natural and additional
resources in RIM that can be combine to see core competencies and competitive
consequences.
1. Natural and Additional Resources of RIM
No Resource & Valuable Rare Unimitable Nonsubstitutable Competitive
Capabilities Consequences
1. Location in Waterloo Yes Yes No No Competitive
Parity
2 RIM reputation in Yes Yes No, but Yes, but to Temporary
delivering the safe and need capital segmented and Competitive
secure voice and data and long sometime become Advantage
transmission (RIM time to negative issue in
cryptographic and build market
software source code)
3 Blackberry Brand Yes Yes Yes No Temporary
Competitive
Advantage
4 RIM R&D and Yes No No No Competitive
engineering Parity
5 RIM Culture Yes Yes No No, cause very Competitive
company have their Parity
own unique culture
2. Combination and Resource Capabilities in RIM
No Resource & Capabilities Valuable Rare Unimitable Nonsubstitutable Competitive
Consequences
1. Location in Waterloo, Yes Yes Yes Yes, but need to Sustainable
RIM R&D and consider with the Competitive
engineering and RIM RIM rapid growth Advantage
culture in market
2. RIM reputation and Yes Yes Yes No Temporary
Blackberry Brand Competitive
Advantage
3.3 Alliances and Partnership Analysis
In the case of RIM, to keep the Above Average Return position is depend on how to
develop their R&D function. In term of strategic alliance and partnership, RIM focus on how
to create alliance and partner that will keep resource and capabilities of RIM’s R&D as their
sustainable competitive advantage. To do that, first we study the key that will determined
RIM success factor in single alliance and second how to build RIM R&D capability for
alliance success :

6. 1. A Single Alliance in R&D function key Success Factors
RIM strategy in R&D function alliance will success depends on how they form it. To
analyze what key success factor will determined RIM SCA, it will consider RIM approach to
maintain technical superiority that fit the explosive growth of RIM ; 1) Do What we do Now,
only more of it, 2) Grow and expand existing geographies, 3) Increase Acquisition and 4) Go
Global.
a. Alliance Formation Phase
Although RIM relationship with Waterloo (including University of Waterloo)
already fulfill three criteria (complementary, compatibility, and commitment) as partner
that have positive influence, its still required other alliance to meet the scope of global
operated company. The strategy in this phase:
- RIM local recruitment strategy, co-op with University of Waterloo had been very
succesfull but for global scope RIM need new strategy. Some strategies that can be
use to recruit new talents are, Expand co-op programs to other universities as well as
have been implemented in Waterloo, lead a global scouting group dedicated to
finding the best talent worldwide and bringing them into RIM, revamping the
careers website and being more creative in the way in which they structured
recruiting
- In established R&D operation beyond Waterloo, must consider that the new location
was not haphazard and cost of talent. The criteria in selecting the new location that
can fit with RIM: have a pool of talent that housed a mature skill set and have
universities with strong technical programs. This criteria also implemented in global
expansion Europe, Middle East, Africa (EMEA), and Eastern Europe
- With the condition of the economic downturn in US and Europe give opportunity to
RIM to make acquisitions, either technology or of software talent. Acquisition to
European mobile company help RIM to overcome the European market that highly
“nationalistic”.
b. Alliance Design Phase
Considering about RIM culture in Waterloo and key differentiation in R&D
operation there are two way to construct alliance with partners depend on location
characteristic. Contractual provisions can be implemented in USA and Europe and a
combination of contractual provision with goodwill and trust can be used when dealing
with China and East Asia region. Equity ownership can be used when building
relationship with European telecommunication market where the market was highly

7. “nationalistic”. Form of the design in this typical of market can be done by partnering
with major research institutes or partnering governmental and educational institution.
Expanding to emerging markets was complicated due to restriction regarding
cryptographic software. Encryption was seen as a “dual-use technology” which could
have both commercial and military value and was thus need to be carefully monitored.
This technology make RIM have competitive advantage toward competitor but also
become obstacle in designing R&D operation alliance. Clear relational contract
between RIM and government institution about this is one way to overcome the
problem.
c. Postformation Alliance Management Phase
Problems in this phase is RIM was not set up to manage a multicountry research
consortium and the mindset in Waterloo was still very much such that core engineer
needed to be seen to be perceived as valuable. So, RIM can manage its alliance
portfolio with copying what it has done best in Waterloo as guidance. To build trust and
commitment from partner to fit Waterloo culture, need RIM commitment itself to trust
the partner in form of sharing the benefit of the alliance.
2. Drivers of R&D Level Alliance Capabilities
There are two points of view to see strategic alliance that RIM need to do to manage its
explosive growth. From value chain analysis, it is about to outsourcing their support activities
especially the R&D operation. As global operated company to hire very particular mix of
engineers and get new insight about new market will determined company R&D sustainable
competitive advantage.

8. From resource base view, strategic alliance that RIM do will capture greater experience
from resource alliance that will increase the capabilities of R&D organization. RIM alliance
in Waterloo had shift from Sustainable Competitive Advantage to Temporary Competitive
Advantage because competitors had done the same strategy, even move to the next step by
make strategic alliance through joint venture, acquisition, partnership, and etc.
IV. CONCLUSION AND RECOMMENDATION
4.1 Conclusion
RIM’s culture could create high significant impact of company’s profitability. Despite
of its core competences, RIM is quite success in term of did the recruitment strategy with
Waterloo University and acquires Slangsoft. Maintain RIM’s culture and acquire the
appropriate company in order to expand the market have made the positive impact even
increase significantly due to its profitability.
4.2 Recommendation
Creating RIM’s culture is one of its strength, however RIM has to realize that
competitors did the similar ways. RIM’s core competences may be concluded as sustainable
competitive advantage, however it is very possible in shifting to be temporary due to
aggresive strategy by competitors. Due to explosive growth and as a big enterprise, RIM must
act globally. RIM need to build an alliance division that will manage RIM alliance portfolio.
With alliance division capability, RIM can capture, store alliance management lesson and
best practices and make the alliance they have done to become firm experience. Alliance
division also will built commitment, trust from its alliance and better coordination between
RIM and its alliance. Transfer knowledge can be share effectively through alliance function.
To maintain RIM R&D culture, RIM can appointed Waterloo to be RIM alliance division
headquarter.
V. LESSONS LEARNED
Lessons learned that can be taken from this case are :
 Growth strategy should be based on limitation of capability and opportunity to achieve
more benefit by combine resource and capability from other party.
 In implementing strategic alliances the company need to consider not only operational
factor but also the of work culture among parties, therefore the alliances could achieve
compatibility, complementarity and commitment.