Research In Motion: Will it Survive 2012?
It is clear Research In Motion has been struggling. After an unfruitful 2011, many speculate that Canada’s most famous technology company will not survive the upcoming year. After technology flops, release dates pushed back and an overall negative outlook, RIM will have to step it up in 2012 to rebound toward the ultimate goal of becoming a more profitable and successful company.
RIM’s 2011 was not its best year. Although expected to do well, RIM’s releases fell short of their mark. One of the biggest issues was the BlackBerry PlayBook. Released in April, RIM brought its take on the tablet to the technology industry proposing that it had made “the first professional grade tablet.” Although sales were around the same amount as the Motorola Xoom and Samsung Galaxy Tab, figures were not of optimum performance and did not meet expectations. This paired with a small recall, poor reviews and lack of apps made the PlayBook’s reputation less than extraordinary.
In late April 2011, RIM announced the results of a slow release. Reducing its profit forecast, investors started to lose confidence in the company and shares dropped as a result.
In May, RIM unveiled its BlackBerry Bold smartphones, an upward spike in the detrimental year. Its BlackBerry 7 OS released at the same time made some speculate that RIM could recover from its downward spiral. But not everyone was confident. In late May, the company faced a class action lawsuit from investors specifying that the failure for RIM to disclose what the suit claimed were adverse facts that led investors to commit to a company they thought would thrive, but currently wasn’t.
2011 kept producing bad results for RIM. By June, the company had to admit defeat and announced its plans for downsizing after its low Q1 results. Streamlining operations and cutting 2,000 jobs, RIM hoped this move would provide benefits by Q3 of 2011. But the BlackBerry reputation did not improve. First, an insider employee released a detailed letter describing what he thought was RIM’s undoing and his recommendations for change. It was a viral sensation, proving employees were also losing confidence. Additionally, in August 2011, London endured violent riots, and there was a suggestion of restricting use of BlackBerry Messenger. This was because rioters were utilizing social media and communication, such as BlackBerry Messenger, to spread word of vandalism and looting. By September, shareholders started calling for the company to pursue sale.
“The status quo is not acceptable, the Company cannot sit still. It is time for transformational change. The Directors need to seize the reins to maximize shareholder value before more market value is lost,” said Chairman and CEO of Jaguar Financial, Vic Alboini in September.
Although in August, RIM saw support from the US Government and their backing of the BlackBerry Smart Reader device for security, this little blip in confidence did not last long. Later in the month, thieves stole $1 million worth of BlackBerry’s from Mississauga, Ontario warehouse. And then, to make matters worse, RIM’s BlackBerry service had a massive outage in October. Occurring in Europe, the Middle East, Africa, parts of Asia and the US, it was suggested that the outage affected millions. Hoping to mollify customers, RIM offered 12 free apps in reparation, but faced another class action suit in Canada because of the outage.
Hoping to reroute Research in Motion’s falling reputation, RIM Co-CEO’s Mike Lazaridis and Jim Balsillie announced in mid-December their choice to reduce their salary compensation to $1 a year in an effort to produce confidence from investors.
In the end, unfortunately for RIM, the year ended dismally with very few expecting recovery, shares dropping drastically, and, to further RIM’s unfortunate year, thieves making off with $1.7 million of BlackBerry PlayBook stock.
Recommendations by the Industry
So far in 2012, Research In Motion doesn’t seem to be making much headway in comparison to its 2011 figures. Early January brought about rumours of a buyout by other tech companies and major businesses. Suggested to be in talks with Samsung and even Ford, rumours were dismissed soon after they blossomed.
Overall, the industry seems to be recommending a pursuit of sale. Another option would be to license out the BlackBerry brand to another company.
What does RIM make of those suggestions? It seems it’s trying to salvage the company by bringing new leadership to the helm. In late January, after numerous rumours about RIM’s plans for the future, Mike Lazaridus and Jim Balsillie announced that they were stepping down from their positions as Co-CEOs. Lazaridus explained that he would stay on the RIM Board as Vice Chair and become the Chair of the Board’s new Innovation Committee. Balsillie, additionally, is staying on the board, but both recommended Thorsten Heins—RIM’s CEO of Product and Sales—as their successor. Working together from here forward, Heins seems to be optimistic about RIM’s upcoming potential.
Tech For Q1 2012
RIM, needless to say, better surprise investors and consumers alike this year. At CES 2012, RIM brought its latest innovations that will be released in Q1 of 2012; here are some of the highlights.
BlackBerry PlayBook OS 2.0
Previewing the new OS at CES 2012, RIM showed off its new BlackBerry PlayBook OS 2.0. Highlights for the upcoming release include an integrated social feed bringing all of your social accounts to one place, contacts and a calendar that feature updates from social media, a native email where you can associate multiple accounts, and more. What’s exciting about this update is that the PlayBook now provides true multitasking, allowing apps to run simultaneously without pausing. Available in February 2012, BlackBerry PlayBook users can download the new OS update for free. This update is expected to bring the PlayBook to a new level, potentially making it a larger rival to other successful tablets.
NFC Capabilities with BlackBerry 7.1 OS
Near Field Communication technology is something many technology companies have been experimenting with. RIM is on the forefront of actually implementing it into its smartphones. Integrated with BlackBerry 7.1 OS, NFC is available via BlackBerry Tag. Changing the way users share information and content, BlackBerry owners can easily tap their NFC enabled phones together and share information such as party invites, invitation to BBM, contact information, documents, URLs, photos, media and more.
A BlackBerry Employee at CES hinted toward more NFC applications in the future such as mobile banking. Another way BlackBerry NFC could be used in the future is in Canadian hotels. Instead of opening your room with a keycard, you may in the future be able to open your door with just the tap of your BlackBerry. Implementing NFC into smartphones is definitely a smart move on RIM’s part.
Research in Motion is an important company on the Canadian technological scene. It is clear Canada would suffer from its loss. Hopefully, RIM will see a better 2012 and its new leadership, technology and innovations will return the company back to its original profitable standing.
Six issues at the top of tax and finance leaders’ agenda
New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.
According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.
And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.
Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.
Trend 1: Businesses seek more strategic counsel from tax
Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.
According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”
Trend 2: Tipping point for resourcing models
Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.
Trend 3: Digital tax administration is moving faster than expected
in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.
"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."
Trend 4: Data simplification and lower-cost resourcing are top priorities
Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.
At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”
Trend 5: Skillsets are shifting
Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.
Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact
Trend 6: 2020 brought productivity improvements
Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.