It is quite an accomplishment to be the #1 Worst CEO of the Year, and it’s fair to say that the pair at the top of Blackberry maker RIMM truly deserve it. They beat out tough competition in incompetence, but their powerful combination of arrogance and complacency got them to top spot.
What did co-CEOs Mike Lazaridis and Jim Balsillie do right in 2011? Unfortunately, not a heck of a lot. Let’s start with the bottom line, a 70% drop in market cap. Like Reed Hastings at Neflix (this year’s #2 Worst CEO of the Year), the market extracts a huge price for failure. Blackberry’s market share is now by some estimates in single digits, a remarkable turn of affairs for the company that revolutionized mobile email. Perhaps most fundamentally, Mike and Jim were completely unable to stem the bleeding at RIMM, providing virtually no comfort to investors, and customers, who wanted to believe in the company. Blackberry outages that made front-page headlines around the world, ill-advised forays into tablet computers, and self-inflicted distractions to buy hockey teams all contributed to a view of leadership as AWOL.
In some ways, the freefall of RIMM was years in the making. For example, the iPhone was seen as a toy, not serious. Google’s Android was irrelevant. We are the kings of mobile email, look at all our customers on their “CrackBerries.” Unfortunately, this turns out to be one addiction that is not all that difficult to kick.
Will RIMM recover? The history of business does not provide an encouraging answer. Once Palm pilots began to lose favor with customers, were they able to make a comeback? No. Has Motorola made up lost ground from their refusal to move from analog to digital in the mid-1990s? No. Is Nokia back on top after taking their eye off the ball for too long? No. But there may be hope. Palm was acquired by H-P, Motorola Mobility was acquired by Google, and Nokia is locked into a partnership with Microsoft. At some point so much value has been lost that the company starts to attract attention by acquirers who remember the past more than the present. RIMM shareholders can only hope.
With this last selection, the #1 Worst CEO(s) of the Year 2011 are now in the record books. Stay tuned in 2012 as I dissect the best, and worst, of what leaders in business, non-profits, and government have been up to, and what we can learn from their mistakes.