Research in Motion: Managing Explosive Growth
(12 pages of text)
2012; 2011; 2010; 2009
Research in Motion (RIM) is a high technology firm that is experiencing explosive sales growth. David Yach, chief technology officer for software at RIM, has received notice of an impending meeting with the co-chief executive officer regarding his research and development (R&D) expenditures. Although RIM, makers of the very popular BlackBerry, spent almost $360 million in R&D in 2007, this number was low compared to its largest competitors, both in absolute numbers and as a percentage of sales (e.g. Nokia spent $8.2 billion on R&D). This is problematic as it foreshadows the question of whether or not RIM is well positioned to continue to meet expectations, deliver award-winning products and services and maintain its lead in the smartphone market. Furthermore, in the very dynamic mobile telecommunications industry, investment analysts often look to a firm's commitment to R&D as a signal that product sales growth will be sustainable. Just to maintain the status quo, Yach will have to hire 1,400 software engineers in 2008 and is considering a number of alternative paths to managing the expansion. The options include: (1) doing what they are doing now, only more of it, (2) building on their existing and satellite R&D locations, (3) growing through acquisition or (4) going global.
This case can be used:
- To teach students how to assess a firm’s readiness for strategic change and the trade-offs involved when managing explosive growth in a company that is under tremendous pressure to be innovative
- To help students understand the link between a firm’s resources and dynamic environments
- To introduce students to the organizational challenges involved in going global
- To illustrate the complexities involved in managing talent globally
This case fits well with an advanced undergraduate or MBA course in Strategic Management, International Business, or Human Resource Management. It presents the opportunity to review firm strategy, including industry and competitor analysis, and alternatives for growth. The immediacy of the need for top talent also has implications for the strategy selected and the development of an implementation plan. It is a good example of the tension that exists between a company’s existing resources and organizational capabilities and the need to respond to dynamic environmental opportunities.
Canada;Global, Large, 2008
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