RIM preparing to cut thousands of jobs

RIM preparing to cut thousands of jobsSo far the Thorsten Heins era of leadership at Research in Motion has been defined by a welcome ratcheting down of the blue sky speak (despite initial hiccups) and a refocusing on the very real and practical changes needed if the company is to turn things around.

However, there's also a hard reality to be faced: the RIM of 2012 isn't strong enough to sustain a workforce of 16,500 employees around the planet. Cuts are coming, and they're going to be painful.

That's hardly news, of course – in fact, it's an obvious reality of doing business: when you stop making money, your business shrinks, and your headcount has to follow.

So far in RIM's case, the publicised staff changes have largely been on the executive level, such as the sidelining of former co-CEOs Jim Balsillie and Mike Lazaridis, or most recently the departure of head of global sales Patrick Spence, but with RIM's first financial quarter closing at the end of the week, more painful cuts are expected to be announced over the next few days.

According to several sources quoted by Canada's Globe and Mail, RIM is expected to make significant layoffs that “will sweep across departments, ranging from senior positions in RIM's legal division to human resources, finance, sales, and marketing”.

RIM's global workforce peaked at around 20,000 back when the company was the leading player in the smartphone game, but last summer 2,000 jobs were cut as the company's change in fortunes started to bite.

In total, this week's cuts are expected to be at least as deep, though some have spoken of a figure as high as 6,000 as RIM tries to restructure its finances to suit its diminished status ahead of what it hopes will be better times ahead once the BlackBerry 10 OS emerges.

Unpleasant though the cutbacks will be – even for those at RIM who keep their jobs – Heins has been warning that “major changes” are needed to help RIM survive practically since day one.

The novelty in terms of RIM's recent history is that his warnings are more than just soundbites: Heins is now more and more looking like a pragmatist who's prepared to make the difficult decisions regardless of how unpopular they make him. Which is probably about the only way RIM will actually survive.

Via Reuters

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3 comments

JanSt / MOD  May. 28, 2012 at 14:23

6000 people who won't buy a BB - nor their fam...

Heins served as a member of the Canadian-German Chamber of Commerce... He should have a grasp of why Germany didn't fare quite as badly as other countries in this recession (so far).... ah well...

matt101101 / MOD  May. 28, 2012 at 17:53

why Germany didn't fare quite as badly as other countries in this recession
That's basic economics, a manufacturing based economy will recover quicker, and not be hit as hard to begin with, compared to a tertiary industry based economy (such as the UK's).

See, I can run RIM too :p.

JanSt / MOD  May. 28, 2012 at 19:14

why Germany didn't fare quite as badly as other countries in this recession
That's basic economics, a manufacturing based economy will recover quicker, and not be hit as hard to begin with, compared to a tertiary industry based economy (such as the UK's).

See, I can run RIM too :p.


Yes, but a major factor was that the strong unions in Germany prevented mass ejection of staff... There were compromises, paycuts etc, but staff wasn't laid-off like the Kardashians' wardrobe. Thus, companies were more flexible and responsive when jobs needed to be done.

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