RIM's top lawyer joins parade of resignations

TORONTO Mon May 28, 2012 3:57pm EDT

One of the women uses a mobile phone as they walk at the Blackberry maker's Research in Motion RIM campus in Waterloo April 18, 2012. Picture taken April 18, 2012. REUTERS/Mark Blinch

One of the women uses a mobile phone as they walk at the Blackberry maker's Research in Motion RIM campus in Waterloo April 18, 2012. Picture taken April 18, 2012.

Credit: Reuters/Mark Blinch

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TORONTO (Reuters) - The top lawyer at Research In Motion Ltd has resigned and will soon leave the struggling BlackBerry maker, RIM said on Monday, joining a parade of long-time company executives to depart since Thorsten Heins took over as CEO earlier this year.

The loss of Chief Legal Officer Karima Bawa - who litigated numerous patent disputes and helped write many of RIM's commercial deals - follows the resignation of RIM's head of global sales, Patrick Spence, last week.

"Thorsten Heins is reframing the RIM organization. Not everyone will fit into the new picture," said IDC analyst Kevin Restivo. "Departures, forced or otherwise, are inevitable anytime management sets a new course for an organization."

The resignations come ahead of what are expected to be massive layoffs this year as the company prepares to launch BlackBerry smartphones run by an operating system completely different from that used in its legacy phones.

RIM's shares have fallen some 75 percent in the last year while its market share has shriveled against competition from iPhone maker Apple Inc and a slew of manufacturers using Google Inc's Android operating system.

RIM's Toronto-listed rose 0.9 percent to C$11.34 late Monday afternoon. The company's Nasdaq-listed shares were not trading due to a U.S. holiday.

Bawa, who joined RIM in 2000, was promoted to general counsel and chief legal officer in late 2010.

She plans to stay with the company while a replacement is hired and during a transition, RIM said in an emailed statement after Reuters asked about Bawa's status.

Analysts and former employees have long complained about what they viewed as a hyper-cautious corporate approach at RIM. That grew out of a drawn-out patent dispute early in the company's rise and was exacerbated by the hiring of a slew of in-house lawyers afterwards.

CLEANING HOUSE

RIM is quietly cleaning out layers of management and recruiting fresh faces to fill important roles in a new structure being fashioned under Heins, who himself replaced longtime co-CEOs Mike Lazaridis and Jim Balsillie in January.

"Thorsten has a very different leadership style," said one former RIM employee who left several months ago. "He is picking a very specific organizational structure, inner circle, external hires and strategy, and a lot of folks aren't 100 percent comfortable with it."

The former employee spoke on the condition of anonymity to protect his ongoing business relationship with the company.

The Waterloo, Ontario-based company currently employs around 16,500 people globally. Two sources with close connections to RIM have told Reuters that RIM plans to bring its workforce closer to 10,000 by early next year.

The sources asked to go unidentified because their disclosures would hurt their relationships with RIM.

The cuts will affect RIM's legal, marketing, sales, operations, and human resources divisions, one of the sources said.

"The Research In Motion people have come to know is very likely to be a much smaller organization in the near future," said IDC's Restivo. "It's a reflection of the company's smartphone struggles. Call it an trailing indicator if you will."

RIM's share of the global smartphone market slipped to 6.7 percent in the first quarter of 2012 from 13.6 percent a year earlier, according to IDC.

A round of 2,000 job cuts was planned for around June 1, the day before the end of RIM's quarter, the Globe and Mail said on Saturday, citing several people close to the company.

Last July RIM said it cut 2,000 jobs, after its worker count ballooned to near 20,000 following a string of acquisitions in recent years.

Balsillie remains the departure with the highest profile. While cutting all formal ties to the company, he remains a major shareholder. Lazaridis is still influential on the board.

A chief operating officer, Jim Rowan, and the head of software David Yach left in March. Soon after, Alan Brenner, a senior vice president for the BlackBerry platform, and Alistair Mitchell, vice president for the BlackBerry Messenger instant messaging product, also left.

The head of RIM's India unit left in November, its head of government relations left months before that, and former chief marketing officer Keith Pardy departed more than a year ago.

RIM said this month it had replaced Pardy with wireless veteran Frank Boulben, who has yet to start work.

It has also named Kristian Tear as its single chief operating officer. He replaces Heins, who took the CEO job, Rowan, who departed, and a third operating head, Don Morrison, who retired last year.

(Editing by Frank McGurty)

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Comments (4)
rdinTempe wrote:
With 16,500 employees, it sounds like RIM got fat like a lot of other fast growing high tech companies.

My experience with this tells me that instead of hiring a good sells staff, the hired a lot of non-productive people.
They kept hiring bean counters to tell them how many beans they haven’t sold and HR people to tell them how the compensation progam for the sales staff was unfair to the bean counters.

May 28, 2012 3:44pm EDT  --  Report as abuse
mulholland wrote:
Research and forward motion wasn’t part of the business plan.

May 28, 2012 5:46pm EDT  --  Report as abuse
Cole_L wrote:
Rumors has it that Facebook is looking into the mobile industry, so why not buy their way in with RIM. RIM is a great shell to use and comes with a lot of patents.

May 28, 2012 9:38pm EDT  --  Report as abuse
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