BlackBerry SWOT Analysis

BLACKBERRY SWOT ANALYSIS 6

SWOT Analysis

STRENGTHS

WEAKNESSES

BlackBerry has strength in its physical resources distributed in different parts of the world. Due to the diverse nature of its customers, the company has plants in Europe and America. Currently, the company enjoys a total space of 1.6 million square feet that has an approximate value of 1 billion dollars. On the space sits the assembling and research facilities as well as the administrative offices. The company, therefore, has space for expansion if the need arises.

Also, its strength lies in the technological capacity of the company. When the company came into existence, it set the bar high for other competitors. Even if the competition from rival companies including Samsung, Nokia, and Apple is still intense, Blackberry enjoys a brand that bears technological innovation and class. The innovative and security feature of its products give it an upper hand over the competitors. Consequently, the company enjoys the procurements by the G7 and the department of defense of the united states. Also, its mobile phones are compatible with software from other companies (Rocha, 2014).

Another important strength of the company is that it outsources the services of top manufacturers of the various parts of their products. The management identifies a manufacturer with credits in a particular field and contacts them. It also identifies the trends in mobile use in the different markets and capitalizes on the. For example, the company is eying India due to its growth in the use of smartphones. The motive not only captures new market niches but also popularizes the company’s image.

Unlike other companies that have been leading in the mobile market, BlackBerry is among those that have recorded a significant increase in their profits margin. In 2011, BlackBerry’s profits amounted to 19.907 billion dollars. However the following two years recorded drop with the worst being in2013 when the company’s profits amounted to 11 billion. The trend is attributable to the company’s weakness of reduced sales of software mainly die o poor marketing and product leadership.

Another weakness that ensues in the company is the relationship with its human resources. The company’ leadership is on the blame for mismanagement and a consequent need to lay off thousands of workers. In 2011, the reduced sales forced the company to terminate the services of 2,000 workers. The following years, another 5,000 workers lost their jobs and in 2014, the company laid off 4,500 employees. John Chen, the new CEO has disclosed that the company might terminate the services of unspecified number of workers in future. The situation, therefore, makes the company as a non-preference for talents that fear to lose their jobs (Chen, 2013).

The company also has an internal weakness in its distribution strategy. Although companies try a much as possible to be unique in their operations, they have to intensify them to make sure that they do not place themselves on the receiving end of the actions of their competitors. Blackberry has a weak strategy that limits its visibility to only a few platforms. Other companies like Samsung and Apple are visible on various platforms, and this gives them a chance to win large numbers of people. Although Blackberry capitalizes on the needs of its consumers as well as loyalty, it misses a point on expanding its market.

Over the past few year, the company has exhibited laxity in the introduction of new products into the market. Unlike the trend observed in close competitors like ale and Samsung, Blackberry has not treated its customers with new products. However Chen assures the consumers that the company can regain its position after the leadership upheavals.

OPPORTUNITIES

THREATS

The company has a significant market in the world market. Mobile phone companies especially those capitalizing on the sale of smartphones are eyeing North America for is predicted an increase in the use of smartphones. Blackberry controls a significant share of the market in this region. The predicted growth is an opportunity for the company to increase its sales and revert the negative growth of its financial returns. The growth comes along with favorable political climate whereby the government systems gives international companies an unlimited trade environment provided they fulfill the various internal regulations (Rocha, 2014).

There lies an opportunity in the growing trend of people using devices that secure their data due to the increased cases of hacking and data recovery. The security feature of BlackBerry phones comes in handy to fulfill the gap. The preference for blackberry products by influential bodies like the G7 and the United States department of defense has an effect on this trend. The reputation of the company in the social arena can propel it to increase its sales. Also across the globe, people are opting to use smartphones and the rate observed in North America is gradually intensifying in other parts of the world. With the increase in mobile phone manufacturers, there are increased cases of manufacturers developing counterfeit products. Therefore, when people want to get the value for their money, they will loom for genuine products with a good reputation. BlackBerry lies squarely is the description of such a company (Statista, 2012).

There is a threat in the Middle East and China over the security feature of mobile phones. In the Middle East, there has a trend of extremist groups defying government regulations and forming rebel groups to fight the mainstream rule. For this reason, they prefer Blackberry that makes it difficult for security personnel to trail their communications. China is among the countries raising concern over the increased use of blackberry-making it difficult to monitor people communication. These governments consider the blackberry security features a threat to their countries security. Therefore, they are still contemplating on whether to ban the use of BlackBerry phones in their countries. Should they decide to implement the idea the company will suffer a big loss in the Asian and Middle East Marketer. It is, therefore, a great risk to the future of the company (Sampson, 2011).

The company operates a firm in Germany to serve the needs of the European market. However, the German government has been against the operations of the company citing that it uses toxic materials to further its activities. The claim is not only a threat to the company’s presence in the country but also on its image to the international community, the corporate social responsibility of the company as perceived by the work population is at risk since many will consider it as a the rest t the environment.

The technological domain is growing fast especially in the communication industry. There is, therefore, a threat of legal sues emanating from overlapping patents. BlackBerry is facing legal proceeding for allegedly contravening the patent rights of Motorola, Visto, MSTG and PACid group. The legal sues are a threat to the innovation of the company as well as its public image. Should they materialize, the loyal customers might perceive the BlackBerry features as copied from other software developers and, therefore, opt for another autonomous company. It will also give the research department a hard time trying to avoid any possible conflict with the registered patents (Statista, 2012).

Core Competency Assessment

Blackberry has a possibility ofexploiting its strengths to counter the effects of the threats andweakness observed in the different areas of operations. Itstechnological reputation and the security feature of its products isa major factor that can help it in regaining its position especiallyin the current social environment that requires data security. Itspresence in the Northern America market makes it possible to increasethe number of sales and reverse it negative financial growth(Statista, 2012). However, it is still not clear how Chen is goingto address the issue in Saudi Arabia and China.

Key Industry Pressures andSuccess Factors

In the mobile market industry,there is a lot of competition from other companies like Samsung,Nokia and Apple. These companies have intensified theirtechnological research, and this forces Blackberry to keep the pace.Therefore, the management sets aside a significant amount of fundsfor research development. The company may become irrelevant in theindustry if it yields to this pressure. The company also facespressure from the political position of Saud Arabia and China overthe increased use of smartphones. The situation requires an urgentaddress to prevent the two governments from banning the sale ofBlackBerry phones in the region. The close competitors are alsoeyeing the improving mobile markets. They are therefore developingnew marketing and distribution strategies. BlackBerry also needs todevise ways to capture a share of these markets and increase itssales.

As a key success factor in theindustry, Blackberry has remained as the only company with high-endsecurity mobile devices that make it difficult to intercept illegallyof data or communication. Besides, the companies trusted productsmakes it the only company that sells it devices to the G7 and theDepartment of Defense of the United States. Additionally, as observedin its strengths, Blackberry products are compatible with othersoftware from other manufacturers. The company, therefore, is in adeal with Samsung to include its SecuSuite and WorkLife in Samsungphones. The move will contribute to the increased use of BlackBerryfeatures.

A close examination intoBlackberry shows that the company is following the generic strategyof gaining new markets. Its strategy to intensify its sales in Indiaand North America shows that is want to increase its market share inthese regions. Further, there has a significant level of partneringwith Samsung by allowing the company to use BlackBerry features onits phones. All terse are in efforts to beating the competition andincreasing the sales.

Discussion and Recommendation

From the analysis, it is clearthat BlackBerry is not the leading company in the mobile phoneindustry but it can regain its position. The strategy used by thecompany for some years has not been instrumental it increasing itsmarket significantly compared with the growth observed in othercompanies. The poor distribution strategy that does not exploit allthe channels available has resulted in the company being popular inseveral packets of the world population.

Therefore, the management underChen should try to reach a bigger population than they current do.The growing trend of using Smartphones may not increase the company’smarket share significantly if it does not use assorted methods ofmarketing and distribution.

References

Chen, J. (2013). Blackberry ceooutlines new strategy. TheGlobe and Mail.Retrieved fromhttp://www.theglobeandmail.com/report-on-business/blackberry-ceo-the-journey-has-just-begun/article16125601/

Rocha, E. (2014, 1 March).BlackBerry to broaden its cross-platform strategy. Reuters.Retrieved fromhttp://www.reuters.com/article/2015/03/01/us-telecoms-mwc-blackberry-idUSKBN0LX1NY20150301

Statista. (2012). Smartphone userpenetration as a percentage of total population in North America from2011 to 2018. Statista.Retrieved fromhttp://www.statista.com/statistics/203713/smartphone-penetration-per-capita-in-north-america-since-2000/

Sampson, N. (2011).Strategicaudit of research in motion.State University of New York. Retrieved fromhttp://digitalcommons.brockport.edu/cgi/viewcontent.cgi?article=1027&ampcontext=honors