What’s so great about Waterloo?
That’s what I would’ve asked at Research in Motion’s annual shareholder meeting, held Tuesday, July 12, in the company’s aforementioned hometown.
Instead, there were questions about RIM’s faltering market performance against Apple and Google, its falling stock prices, corporate governance and the future of its popular line of BlackBerry smartphones.
“We’ve faced some challenges,” was all co-CEO Mike Lazaridis would admit.
You can make a laundry list of all of RIM’s woes – there are many – and each one can be attributed to its location in that small Ontario town.
Lazaridis and his partner Jim Balsillie are under the gun to turn the company around. Shareholders, analysts and media are all aspiring to come up with ideas to do the same.
Earlier this week, RBC Capital Markets suggested RIM split itself in two – divide networking and phone business to “accelerate innovation and unlock shareholder value.” One shareholder at the meeting called Lazaridis and Balsillie innovators who don’t know how to sell their own products.
But the root cause of RIM’s problems is the sorry destination it chose for its headquarters. The first order of business for Lazaridis and Balsillie is to move the HQ to downtown Toronto.
It starts with corporate culture. The RIM parking lot is a vast, empty space on weekends. Employees get in at 9 and leave at 5 on the dot.
No one in Waterloo would know any different, though, because it’s a place where everyone leaves when the whistle blows and takes weekends off.
But global innovation doesn’t just happen between 9 and 5, even if small towns do. RIM needs to work at a big-city pace. The easiest way to do that is to move to one.
Then there’s talent. Look, Waterloo is a lovely place, I’m sure. But who would want to relocate there? Especially when the world’s other big firms are in places like San Francisco and New York.
For RIM or any technology company, acquiring and retaining talent is everything. You can’t do that in the midst of rural Ontario.
Look at the position of chief marketing officer – the most recent CMO bounced over to Samsung, so Balsillie has had to step into that role.
Now, no coincidence, RIM’s having a wretched time selling itself.
For marketing recruiting alone, Toronto is major league. RIM needs to get in the game here.
Appearance is something. Google’s offices are a “campus.” Apple is building amazing, cutting-edge buildings in California. RIM, meanwhile, lives in the home of the Ice Dogs Festival.
Most international firms – take FarmVille maker Zynga, for instance – now have full Toronto divisions. RIM, a Canadian company, should live here outright.
Balsillie, of course, has strong ties to the western Ontario region. He tried to bring a hockey team there, remember.
But RIM’s time in Waterloo has met its Waterloo. Its headquarters are now an albatross holding back the company.
It’s time to move on, and all roads lead to Toronto.
joshuae@nowtoronto.com
