The Fatal DNA of RIM & Canadian Enterprises
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Note: RIM - Research In Motion, later renamed as BlackBerry Limited; it was a Canadian software company specializing in cybersecurity. Founded in 1984, it originally developed the BlackBerry brand of interactive pagers, smartphones and tablets.
In the global smartphones industry, RIM can be called as originator and pioneer; but now, the most of people may don't know it anymore, it was a sadness of Canada manufacturing industry.
This topic was written in Jan 27 2014 to reveal the fatal DNA that failed RIM and many Canadian manufacturers. It is common in failing manufacturing industry in the all of the democracies. --- Frank Li Feb. 4, 2024
The Fatal DNA failed RIM & Canadian Enterprises
Frank Li Jan 27 2014 in Waterlo, On. Ca. Updated in Feb. 8, 2017
http://frank-waterloo.blog.163.com/blog/static/205239029201402710343833/
This article takes failed RIM as example to discuss some factors or called fatal DNA in negatively affecting the healthy operation of Canadian enterprises.
The decline of Canadian manufacturing is not mainly due to poor economic environment, but, the poor corporate management under improper social ideology
The successful enterprises are mainly driven by motivating their employees fully exerting intelligence.
The failed enterprises are mainly due to that their employees cannot free exerting intelligence.
Management is the Art of Playing Human Nature.
Outstanding German manufacturing drives by legislated sharing the profit of the application of rationalization proposals to motivate employees to pay talent into the business since Mr. Krupp initiated it in 1872.
102 years old IBM has been full of vitality driving by the flexible reward incentive measures for those who made contribution, especially the patent-linked bonus reward incentive system.
That suppresses employees in freely exerting intelligence is the fatal DNA in causing RIM and Canadian enterprise decline.
In the Era of agricultural economy, the geographic space is the living space. In the Era of market economy, the market space is the living space, without competitive manufacturing, Canadians are losing living space.
Content
1... The inspiration for the topic
2... A key maker reveals the Fatal DNA of Canadian business
3... Stifling intellectual work environment damages RIM
4... Some staff is in low Intelligence Quotient - IQ
4.1...The intellectual fruits are often seized by others
5... Short-sighted, without market-tracking and preparation
6... Dictatorial boss and managements inbreeding
7... How did the fatal DNA damage the RIM?
7.1... RIM senior exec has to express opinion by Open Letter
7.2... RIM employees' similar experiences of the Open Letter
7.3... RIM scientist has similar experience of the Open Letter
8... Related reports on news media
1. The inspiration for the topic
RIM - Research In Motion Limited, a designer, manufacturer and marketer of wireless solutions for the mobile communications that headquartered in Waterloo, Ontario. As a successful high-tech enterprises, once was the pride of Canada. Now is BlackBerry Limited, its Headquarter is just several blocks away from my home.
Recent years, facing new competitors rapid rising, it has been retreating. The bad news are continuous, the sales decline, the stock devaluation, downsizing, the arguments of the privatization or so, every bad news have deeply hurt my nerves.
However, that made me most sad is from a gossip, that a second grade pupil said that her parents are both working in RIM, once, to be laid off together, their home will no money pay for mortgage, their new house will be repossessed by bank, She worries nowhere to live?
RIM, the total employee is nearly 20% of the population of it headquartered city, although that include the staff who works in the branches of other cities, but big proportion are from locals. So, its rise or fall will strongly impact the life of local community. However, for RIM's declining, besides the families of the founder, the families of their staff, and the governors of Canada, I think that, there are few people would care about.
Nov. 4 2013, the article <BlackBerry receives investment of US$1 billion from Fairfax Financial and Other Institutional investors> reported that: “John S. Chen to be Appointed as Executive Chair of BlackBerry’s Board of Directors and Interim CEO."
The report gave me a new hope. Finally, RIM gets solution to clean up the mess, the farce returns to serious play.
2. A key maker reveals the Fatal DNA of Canadian business
When reviewing the reasons for RIM's decline, I think of a story.
12 years ago, in Toronto Canada, I went to make a copy of a key, the man who worked for me was a great aged locals. He sees my key, and then to find the blank key with the same shape of my showing to him. Maybe the great contribution of his great age, after a while, he did not find the proper one in the thousands of hanging blank keys.
I felt somewhat anxious and said with finger pointing: “that one should be fine.” He immediately said with unhappy: “do not teach me, this is my business.”
His reaction in response of my suggestion is far quick compared with his retarded body movements under serious degraded brain that eroded by time stream naturally, which has engraved unforgettable impression in my mind.
That was my first time to taste the taste of the business philosophy of the Canada. It should be a rare wisdom with negative value.
It is one of the Fatal DNA of Canadian Enterprises.
3. Stifling intellectual work environment damages RIM
For RIM's decline, people can find many sound reasons, however, I think that, the most fundamental one is the stifling intellectual work environment, which is that suppresses the free exertion of intelligence of the employees without a proper channel for employees expressing their views freely to have damaged the driving force for continuously self-revolution to fit the market that increasingly rapid changes.
Such a corporate culture is common in Canadian enterprises, which is just opposite that of smart doing in IBM and German Companies.
This is one of important lethal gene fragment in Canadian enterprises.
May 28, 2012, in the article The DNA of the Success of German Manufacturing, I mentioned that, the driving force for German outstanding manufacturing mainly comes from their legislated management for rationalization proposals, which is with profit-related bonus to motivate all staff to pay their full talent into the business running, since Mr. Friedrich Alfred Krupp initiated it in 1872. Now, in all German businesses, their staff can use computer network systems to easily submit or query their proposals.
I once read a report in Mandarin, that the Financial Crisis 2008 has caused great panic in worldwide business community, however, a German government official said that: our German companies are not worry about; we can call all employees to dig potential within the enterprises to make self-compensation. In fact, in the European Sovereign Debt Crisis, the industrious Germans play a role as that of the savior for those European losers.
Dec. 22, 2011, in the article The DNA of the Success of IBM & America's best-run companies, I mentioned that, the driving force for 102 years old IBM is still full of vitality and the patent invention has been counting on the top of those world-class corporate giants in the United States for 20 consecutive years in 2013 is the patent-related bonus incentive system. In IBM, for any staff, published an article, approved a patent, all have assessment records with regulated cash awards.
Above incentive methods are common in China for decades, which all employee have consciously accustomed to do everything possible for the sake of business under the motivation of bonus, which is why that China's economy has rapidly developed within decades and it said that is the process of a century in other countries, and now the daily goods that labeled with made in China are throughout the world.
Aug. 10, 2013, in the article <Industrial Engineering, the magic for improving production efficiency> I said that:
“As my experiences, that many initial designs of machines or production technologies are not perfect with somewhat shortcomings despite the designer has considered every possibilities carefully. They need to be found and improved in practical use.”
“In the realistic production, there is much such room for improving but lacks being paid attention because most of business' owners are never thinking of motivating their employee to think about why and how. The production lines' operatives are the main force of this activity.”“Since that the improvement requires repeated personal observation or experience, the operators who are working daily on the production line is easily to find them, rather than that of technicians or management staff who never practically operate in person.”
"The improvement processes are often very simple but have big potential of the cost saving. The results are often contrary to the common sense of the public. People would be surprised to ask that, why I did not think of about that before.”
"In China, the Enterprises set up three-pronged team by operators of production line, technicians and managements' staff. The operators are able to find the problems, but may be without the ability to solve the problems, so they need the help of the technicians for doing some design, and the managements' staff may help to organize the whole practice."
But, in the businesses of Canada, such a significant manner seems to be taken as illegal, in the eyes of some Canadian business owners, in the eyes of some of their management staff, and even in the eyes of some of their common employees, the proposal provider is too bad to allow working in the company by making every efforts to squeeze them out, without essential sense of how to ensure the healthy development of their company, and thus to keep their jobs for making their livelihoods to keep their families survival in the times that the businesses and the jobs disappear continuously.
Besides that, there are many other bad factors in effecting the health running of the Canadian Businesses.
4. Some staff is in low Intelligence quotient - IQ
Feb. 13 2013, Business Development Bank of Canada (BDC) issued the survey report that Canada's mid-sized firms in decline, with a subtitle: Manufacturing sector worst hit, losing half its firms between 2006 and 2010.”
"Mid-sized firms represent 1% of companies, but contribute 16% of Canadian jobs, 12% of GDP and 17% of exports.”
"Canada’s mid-sized companies saw their numbers decline by 17% — from 9,370 to 7,814 — from 2006 to 2010, in which, the manufacturing sector reduced more than half, from 2,807 to 1,381 between 2001 and 2010.”
But the article specially indicated that "Mid-sized firms with a board of directors or an advisory board are most likely to say they expect sales to go up."
For the firms' decline, the writer gives many reasons, such as, the depreciation of the Canadian dollar, corporate financing difficult, but it seems to ignore an important reason - a common phenomenon that is some foolish employee with mindless behavior in the workplace to have caused the closure of good enterprises. Such as, the ABC Company and DEF Company that introduced in my article <Canada's Corporate Management & Reducing Psychological Pressure in Workplace>, which is written according to my work experiences in the Enterprises of Canada.
Besides those foolish employees, a number of management's staff in Canadian Companies seems lack of rational thinking also, if, to give them the right to fart once, they dare to put the atomic bomb twice, as that of the supervisor John that introduced in my article <Family Business and Management Board>.
Above foolish employee and management's staff should belong to Low IQ.
In local Canadian firms, no matter the management staff or the employees, there are a considerable group of them with childish mentality in lack of rational thinking ability.
In nowadays hardship economic environment, the enterprise is the lifeboat sharing by owner and employee to struggle for survival, but, less people understand this vital point to cherish their business and job opportunities. There are some employee, and even some management staff chiseling holes on own lifeboat.
As management staff, some of them, the interests are more in the enjoyment of the privilege of dominating others, with less in consideration of the interests of the business. Once give them right for fart once, they dare explode nuclear bombs twice.
As production operators, some of them, the interests are more in enjoyment of chiseling holes on the lifeboat, with less in consideration of how to make lifeboat safe, with the mentality of gaining more by doing less as the smart, even intendedly troublemaking for other operators or for normal production.
4.1... The intellectual fruits are often seized by others
I am eager to explore the management reason of the failure of RIM with any possibility, especially, I would eagerly ask related questions as long as meet the people who once worked in RIM.
In around 16:10 June 26, 2014, I discussed the such issue of RIM with an art profession specialist who once worked in RIM for many years and now working as a general operator in the production line of the foods processing.
She said that there was also the management for the rationalization proposals in former RIM. However, the fruits of the achievements of the rationalization proposals were seized by the management staff, so the technical personnel of the main body for the rationalization proposals stopped their effort on any proposals.
She also said that, in former RIM there were also comprehensive regulations as that of other well managed world class companies, but, the regulations cannot function effectively, due to that managements play with own preferred accord.
As my experiences from working in many different Canadian businesses, in the eyes most management staff of locals, there are no sense for that what is regulation, even, no sense of what is law?
5... Short-sighted, without market-tracking and preparation
Some information may possess the potential that may make a business big gains or big losses. However, some business owners of Canada seems no sense to seek and timely seize the opportunities for business long-term development, especially, in today‘s market that situation changes instantaneously.
Recently, I wrote an article to discuss that TPP will kill Poultry Industry of Canada. Indeed, it is a strategic analysis about the dairy and poultry industry of Canada. If the business owner in relating industry can prepare in advance, it may be a good opportunity to promote the great development of own enterprise, on the contrary, the business may be damaged to be a victim of sacrifice to promote the great development of others.
Such as, the high production cost of Canada will make the poultry products lose market when cheaper foreign products flood in after soon disappearance of tariffs dam, and then the production equipments will lose the value, especially for those acquisitions after Harper has announced to join the TPP negotiations in two years ago, that is indeed the consequence of the numbness of the business nerve of the business operators.
The fruit of an entrepreneur achieved with life long hard working may be flowed away by the market flood. I am worried about that some of the entrepreneurs may not be able to afford such a blow.
For top managements of the RIM seems have made a big mistake of without on timely tracking the market information for on timely updating their smart phone.
6... Dictatorial boss and managements inbreeding
As my view, in essential, above those all are not personal wrong, but caused by the ordinary common sense of humanity. Few people can out of this innate tacky, including me, talking is easy, doing is difficulty.
I think and talk about these sensitivities unhappy topic with exposing people's scars, the aim is that all companies can healthy develop, the owners can achieve their aspirations, and every employee can keep their job for making livelihood.
The motivation for this topic today is mainly from the decline of RIM, also, partially is from my first job in Canada - a general labor in an auto parts company. The hard work of the business owner, especially his earlier death, has been lingering in my mind. Now, counting with fingers, that has been past almost ten years.
April, 11, 2013, according to the experience, I once wrote an article <Family Business and Management Board> with that:
"There was a supervisor John who worked in the company from the business’ starting on his 15 years old in 30 years ago. He took charge of shipping, receiving and a group of people of packaging."
"He came to work at around 10:30 - 11:00 am every day under the regular hour of 8am - 5pm, some times did not show up, some operators had to finish his job."
"The reason for John dared do so, I thought, it was that he thought himself to have contributed too much for the Company, so he should enjoy the treatment as that of the father of the owners’."
"Maybe, as the same reason, for the preposterous behavior of John, the owner dared say nothing besides had to hire another supervisor - Albert to take part of his job, especially for some important jobs, such as, the shipping and receiving when John did not come."
Then, John starts to boldly make trouble for Albert in workplace, even affects the normal work of others by blocking the walkway of the workshop when unloading the delivery trucks. Some times even cause Albert crying, but big boss can do nothing besides sadness and sigh.
Finally, John was fired due to boss found that he has been selling auto parts privately by the name for delivering.
Not too long later, the big boss died on the operation bed of a hospital.
Now, think of about that, we can not say that the earlier death of the big boss was all the responsibility of John, however, no one doubt that John was play a key role as a major inducement.
In view of this, I believed that "No matter whatever, which way, for the sake of business running smoothly, to hire some professional people outside of the family to establish a management board and business regulations is a best way. Because of that new managements have no former relations in vital interest with those original employees, they will be able to relieve or resolve down the conflict that may originally exist between the employees and owners. Such conflicts are hardly to handle. The harm for the enterprise is fatal."
On other hand, more people, more talents, more wisdoms for well running the business.
As mentioned in the article <Canada's Mid-Sized Firms in Decline>, that "Mid-sized firms with a board of directors or an advisory board are most likely to say they expect sales to go up."
Remember that is a board - a group of people, rather than any individual. If you give the manage-power to any individual, he or she may quickly send you to other world to enjoy the life without any worries. Since that, with the time extending between people will inevitably produce conflicts that will be difficult to reconcile. This is not any people bad but it is destined by the weakness of human nature. It is natural.
Although, that RIM is a listed company with a board of directors, however, the founder has been on the top executive position. In following letter from RIM employee, you will find similar middle management staff has boldly played in RIM as similar as that of the supervisor John, the harm of this manner is huge.
If the business founders stay on the highest executive positions, there may likely produce other potential harms that they would naturally appoint those people who have contributed to the company at the difficult initial period of the business as assistants to occupy important leadership positions - managements inbreeding.
But the quality and ability of those assistants may be not capable for their vital responsibility, at the same time; they would very likely grow into arrogant with ignoring the interests of the company to do whatever they want with own desire. More teribble is that they would naturally form a personal network acting as brutal gangs to suppress the exertion of the intelligence of new employees.
This is natural matter with inevitable, it is regardless of ethnicity and nationality, since it is determined by Human nature and Crowd psychology.
Above are some Genetic Fragments of the Lethal DNA of Canadian Corporate.
If we dig the reason of the ridiculous behaviors in Canadian businesses，the cause is that some people boldly take the stupid as smart (although, such individual is few, but the harm is huge), the only explanation is that they are just physical mature, but mental immature. In essential, it is that the adult body equipped with a kid's mind.
Feb. 09, 2014, I wrote article <Human Nature, Crowd Psychology and Corporate Management> to specially discuss this issue.
As above concerning, in Jun 25, 2013, I once wrote an article My view on Entrepreneur and Enterprise inspired by peter Shoore, in that article, I mentioned a report CANADIAN POULTRY — August 2008 that published 5 years ago with that:
"After earning his doctorate in music in the mid-1970s, Shoore decided to return home rather than remain in an overcrowded Europe. Deciding he couldn’t make it as a classical musician, Shoore went to work in his father’s small cannery where, among other things, he canned whole chicken."
"After 25 years in the business, Shoore is giving more responsibility to his upper management and starting to groom his son to take over." Peter said that "I wouldn’t know what to do with myself if I retired. I hope they carry me out of here.”
In Canada, the smart entrepreneur as Peter Shoore is few, rare. I particularly appreciate the practice of Peter Shoore, so I have repeatedly cited his deeds as examples. Also, I have been trying to find out the reason. The answer is that Musicians 'have sharper minds'.
Are Canadian businesses that are with Lethal DNA doomed to fail? This is the topic in the article Management is the Art of Playing Human Nature.
7... How did the fatal DNA damage the RIM?
Now, I would like to take the RIM as example to demonstrate that how did the Lethal DNA damage the good high tech company?
7.1... An RIM senior exec has to express opinion by Open Letter
Two years ago, I read an article Open letter to BlackBerry bosses: Senior RIM exec tells all as company crumbles around him Jun 30, 2011. The writer is Jonathan S. Geller who is the founder of BGR - the biggest mobile news destination in the world. He currently acts as President and General Manager of the newly formed BGR Media, Inc., and Editor-in-chief of the BGR website.
In the article he said that: “We have received an open letter to Mike and Jim from a high-level RIM employee (whose identity we have verified), and in an amazingly honest and passionate plea, this letter gives fascinating insights into what RIM must fix, and fast. RIM did not immediately respond to a request for comment.”
The start of the open letter and the 8 suggestions as follow:
“To the RIM Senior Management Team:”
“I have lost confidence.”
“While I hide it at work, my passion has been sapped. I know I am not alone — the sentiment is widespread and it includes people within your own teams.”
“Mike and Jim, please take the time to really absorb and digest the content of this letter because it reflects the feeling across a huge percentage of your employee base. You have many smart employees, many that have great ideas for the future, but unfortunately the culture at RIM does not allow us to speak openly without having to worry about the career-limiting effects.”
The 8 suggestions:
1) Focus on the End User experience.
2) Recruit Senior SW Leaders & enable decision-making.
3) Cut projects to the bone.
4) Developers, not Carriers can now make or break us.
5) Need for serious marketing punch to create end user desire.
6) No Accountability – Canadians are too nice.
7) The press and analysts are pissing you off. Don’t snap. Now is the time for humility with a dash of paranoia.
8) Democratise. Engage and interact with your employees — please!
The proposals are not only pointed out the problems, but also offered workarounds, especially reconstruction of management, interaction with employees and to be managed in accountability. It shows the writer's honesty in deep concern for RIM's future, and well thought out.
From above 8 suggestions, we could feel that chaotic in the management.
Above 8 suggestions were all to hit on the root cause of the failure of RIM and perfect suitable for any businesses.
However, RIM’s responds to open letter was not only with no thanks, instead, was somewhat hatred condemnation, the first paragraph is as follow:
“An “Open Letter” to RIM’s senior management was published anonymously on the web today and it was attributed to an unnamed person described as a ‘high level employee”. It is obviously difficult to address anonymous commentary and it is particularly difficult to believe that a “high level employee” in good standing with the company would choose to anonymously publish a letter on the web rather than engage their fellow executives in a constructive manner, but regardless of whether the letter is real, fake, exaggerated or written with ulterior motivations, it is fair to say that the senior management team at RIM is nonetheless fully aware of and aggressively addressing both the company’s challenges and its opportunities.”
7.2... RIM employees’ express similar experiences of the Open Letter
Followed RIM responds to open letter, BGR posted the comments emails.
Jul 1, 2011, BGR published <More letters to RIM; employees rally alongside anonymous exec>, the writer Jonathan S. Geller said that:
“BGR published an open letter to Research In Motion yesterday.” “ RIM responded. It wasn’t pretty, and it really didn’t address a single point that was made by the original plea. It wasn’t just RIM that responded, however — we received dozens of emails from current and former RIM employees detailing their stories, and essentially all agreeing with the open letter that was published on BGR.”
BGR has made a announcement with that:“Among the correspondence were several new “open letters” written by RIM employees, and the BGR team has gone through them at length. There were nearly a dozen gems amid the emails we received, and while we may address various highlights in the coming weeks, we can’t publish them all at this time. We thank each and every person who took the time to email us with their thoughts, but there were two in particular that stood out from the crowd.”
Following is the part of an email from a former RIM employee.
“I was an employee at RIM for a year and a half. I worked in the legal and business affairs departments, and despite having originally thought I’d landed the jackpot job-wise, it took no time for me to begin planning my exodus.”
“My first week started with a complete change in my title and duties without anyone telling me, and when I dared ask what was happening, the director (my boss) and her BFF the OD business partner ganged up on me and threatened to let me go, setting the tone for the remainder of my time there.”
“Over a year an a half, the four of us in the same position dwindled to just me and yet I was responsible for getting all four jobs done for the better part of a year, since this is how long it took the department to hire other entry-level people. Two individuals who had less education and experience (not to mention drive or intelligence) than me were promoted several times while my boss continued to tell me up and down that I had reached my ceiling at RIM due to my lack of education (two degrees!) and experience (5 years!)–as an administrative assistant. Rather than attempt to fight this system I figured I could transfer departments, only the company policy requires the supervisor to act as a liaison and reference for internal applicants. The insanely high turnover rate meant the department head wouldn’t let anyone go, in addition to refusing to promote from within (pets excepted). People were pitted against each other and an incredibly tense and hostile work environment was fostered. People around the office started referring to the office politics as “Survivor: RIM edition.” And we all remember the great movement to make recycling physically impossible across the entire company because one person let some confidential information slip.”
“Then, as I was saving up to return to school and make a better life for myself, I received a series of nasty emails from HR letting me know that since my boss had failed to log my vacation time a year earlier on SAP (despite my insistence on her doing it at three different times), I would have two full paycheques deducted to “pay back” the company for what was being portrayed as my mistake. I never received an apology and almost had to drop out of school due to the loss of a full month’s pay. On my last day my boss deliberately avoided me at all cost. The best part is that I recently heard that my boss just got promoted to the VP of the business affairs department.”
I appreciate the comment of C3vsThWorld: "Its WAS NOT a good response...the letter from the employee was one of honesty and true concern for his company. All this response did was throw numbers around as if that made anything the person said false."
7.3... A RIM scientist has similar experience of the Open Letter
After reading the open letters, RIM's responds, the emails of RIM's employee and the readers' comments, I once talked with an employee who is working in the lab of RIM as a material scientist. She said that she once wrote a suggestions’ letter to the management of RIM, but without any response. She felt that the corporate culture of RIM is not worthy for appreciation.
Besides above, I once called my friends who were working in RIM at that time.
The one who works in the service department said that their work efficiency has a lot of room for improvement.
Obviously, in RIM, it has no normal channels for facilitating the communication between subordinates and superiors to promote the development with the wisdoms of all employees.
I call this phenomenon as the obstruction of enterprise. It also is fatal, and it is the main cause of RIM's decline, and the main cause of RIM did a dirty job with the outstanding employee.
Indeed, the topic of this article may take as the discussion of the issue of Corporate Culture, at least in most of. From the experiences of world class successful enterprises, no one would doubt that, a healthy corporate culture is a prerequisite for their healthy development.
The reason for my taking RIM as example is not for criticizing RIM, but I would like to sum up lessons for improving the management of Canadian firms, so that they can healthy development.
Talking about to here, it is necessary to talk about a story.
I have a friend, as a strategic analyst, is working at Mobil Alberta branch. We often long chat via telephone to talk about the corporate management issue, especially for Mobil, a world class company. We both worry about the economic downturn. He said that, in the last two years, the rent is skyrocketing near their neighborhood, a same basement room is $300/m in last year, is $450/m in this year. The tenants are mostly from eastern Canada.
These fully demonstrate the poor management of most Canadian businesses, and the serious of the Canadian economy.
8... Related reports on news media
Terence Corcoran: Is BlackBerry Ltd too Canadian to fail?
Terence Corcoran | Sept 27, 2013 More from Terence Corcoran | @terencecorcoran
http://business.financialpost.com/fp-comment/blackberry-ltd-canada
THE CANADIAN PRESS/Chris YoungWe must accept that Fairfax Financial CEO Prem Watsa genuinely wants to save BlackBerry not just because he believes there’s a business there to be salvaged and revived, but because BlackBerry is a Canadian enterprise that must be saved because it is Canadian. Thousands and perhaps even millions of Canadians probably share his emotional if not quite rational view.
Saving BlackBerry to keep it Canadian ignores the success in our history of failure
Some already call him the Warren Buffett of Canada, but if Prem Watsa hopes to hold on to that flattering label he might want to drop the Canadian nationalism that seems to be driving his attempt to take control of BlackBerry Ltd.
A big nationalist spirit pops up whenever the head of Fairfax Financial talks about his US$4.7-billion plan to buy all the outstanding shares of the world famous smart phone maker. As he put it the other day, “One of the reasons I went on the [BlackBerry] board, and I said it publicly, was to keep the company in Canada and to make sure it survives and exists in Canada. It is one of Canada’s most successful companies. Companies do fall on hard times and they come back again and we expect this company to do the same.”
We must assume Mr. Watsa is serious when he rolls out the Canadian angle as one of his prime motivations. We must accept that he genuinely wants to save BlackBerry not just because he believes there’s a business there to be salvaged and revived, but because BlackBerry is a Canadian enterprise that must be saved because it is Canadian.
Thousands and perhaps even millions of Canadians probably share the same emotional if not quite rational view. The company founded by Jim Balsillie and Mike Lazaridis now apparently needs to be coddled and protected. At BlackBerry’s peak, the two CEOs became local heroes, iconic corporate stars, symbols of a collective national achievement who somehow represent features of our national psyche. They are us, we are them.
It’s not the first time.
Back in 2009, Mr. Lazaridis himself played to the nationalist gallery when he appeared before a House of Commons committee to argue against the sale of some Nortel Network assets to a Swedish company. To make his point, he hauled out the tired old industrial policy tear-jerker yarn about the Avro Arrow, the Canadian-made and Canadian-designed fighter jet killed by Ottawa in 1959. “Fifty years later we consider the disposition of another beachhead [Nortel] built by Canadian ingenuity,” he told Parliamentarians. “Let us learn from our history and not make the same mistake again.”
Related
BlackBerry posts $965M loss as revenue drops 49%
BlackBerry Ltd partners waver as rumours swirl the smartphone pioneer could exit handset business
At different points in history, Canadians have sought to preserve businesses as if they were part of our identity. We want to hold on to them. Protect and own them when they’re great, prop them up when they are weak, cry for them when they die, avenge them when they are buried.
Except, of course, that Canadian corporate history is littered with the bones of enterprises that came and went, died young or failed in old age, and are now barely remembered, if at all. “Some firms are so far gone we can’t even remember them,” said the great Canadian historian, Michael Bliss, in an interview this week.
In his 1987 book, Northern Enterprise: Five Centuries of Canadian Business, the former University of Toronto professor unsentimentally documented the rise and fall of whole industries and scores of companies. During the interview we came up with dozens of once-famous Canadians companies, BlackBerry forerunners that not too long ago were seen as Too Canadian To Fail or too important to fall into the hands of foreigners.
The global tractor giant Massey-Ferguson; the national retail powerhouse T. Eaton Co.; the Tilden car rental business; the steel giants Stelco, Algoma and Dofasco; Dome Petroleum; the household appliance makers Inglis and GSW; telecom equipment giant Nortel Networks; the Reichmann’s Olympia & York real estate empire.
And who can forget — except most Canadians have forgotten or have likely never heard of — Michael Cowpland and Terry Matthews, the two flamboyant Ottawa whiz kids who founded Mitel Networks in 1973. Mitel Networks became a world-beater in the telecom switching business. Along with Nortel, Mitel was at the heart of Ottawa’s Silicon Valley North, before it ran into financial troubles in the 1980s and was sold to British Telecom, which a few years later broke the company up. Various Mitel pieces continued to operate for years.
Cowpland and Matthews were the Balsillie and Lazaridis of the 1980s. Whether BlackBerry will evolve along the lines of Mitel, with various parts continuing to exist for years, would be nothing but speculation at the moment.
The idea that companies such as BlackBerry or Mitel or Eaton’s or Massey-Ferguson can and somehow should endure is mostly a fantasy of the moment that ignores history. Businesses and their executives are sometimes treated like sports heroes whose teams we want and expect to win. When sports teams lose, however, we shrug and move on to next year. The same should be true for businesses that run into losing streaks and often disappear. Tomorrow is another day and another batch of entrepreneurs and circumstances will conspire to produce new successes — and more failures.
In a comment on his Northern Enterprise history years ago, Mr. Bliss saw Canadian business failures as a natural part of the landscape: “One of the strongest themes in my book is failure in business.”
The last chapter begins with the collapse of Massey-Ferguson, the farm equipment giant whose plants once dominated vast swaths of central Toronto real estate now overrun with massive condo developments. “One of my strongest beliefs about business history generally is that you have to write the history of failure as well as success. And if the book does nothing else, it conveys a sense of a business world which is fraught with peril, hazard and frequent failure.”
In BlackBerry’s case, blundering management, bad decisions and a co-opted board of directors are often portrayed as the creators of the hazards that eventually felled the company. What history will likely show, however, is that BlackBerry was wiped out by a hurricane called Apple. The iPhone became a massive force that swept the smart phone industry with a fury that was likely beyond the control of anything BlackBerry could or might have done.
So too with Nortel, the other great Canadian tech giant that, ultimately, was felled by rapidly changing global markets. Could Nortel have survived with better, smarter managers? Possibly. But it is certain that it would have been foolish for anyone to have mounted a political or business campaign to save the company and keep it Canadian for the sake of keeping it Canadian.
As the BlackBerry story unfolds, it looks like the tech rocket the company launched in the Kitchener-Waterloo area will provide a foundation for new activity. Thousands of jobs will be lost at BlackBerry, but many in the region are confident thousands more jobs will be created as new companies emerge to capitalize on the legacy the company leaves behind.
Even if that hope were likely false and new jobs created were unlikely to replace the losses, there’s still no reason to fall into an anxious nationalist lament and force government or financial institution to support BlackBerry as a going Canadian concern. That’s the preference of some, including Jim Stanford, economist at the Canadian Auto Workers/Unifor union. In a tweet this past week, he asked: “Does govt have ‘any’ role to play in Cdn high-tech like Blackberry? Or just let the ‘chips’ fall where they may?” The right answer is: No and Yes.
If Prem Watsa has a viable plan to save BlackBerry and keep it whole in Canada as a Canadian firm, that’s fine. If it works he’ll be the next Canadian corporate hero and earn his title as Canada’s Warren Buffett.
If Mr. Watsa doesn’t succeed, Canadians — along with BlackBerry investors and users everywhere — will be saddened. But that’s the nature of enterprise in Canada, filled — as Mr. Bliss put it — with peril, hazard and frequent failure.
Why meetings are bad for you — and your business
While meetings may be necessary, there's a growing awareness in the corporate world that we can’t let them go on aimlessly. Bottom line? They're bad for business.
By Sophia Harris Business reporter
Sophia Harris has worked as a CBC video journalist across the country, covering everything from the start of the annual lobster fishery in Yarmouth, N.S., to potash prices in Saskatchewan. She now has found a good home at the business unit in Toronto where she produces for the national news and writes and shoots and edits video for CBC.ca.