What are the dominant economic characteristics of the wireless communications industry? What are the distinguishing features of the market for smartphones?
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The wireless communication industry is marked by several important characteristics. One of them is the intense competition among various corporations that offer similar products and services to clients. Among them, one can distinguish Research in Motion (RIM), Motorola, Sony Ericsson, Apple as well as some smaller companies. Another economic characteristic is the growing market for this industry. For instance, in 2007, there were at least 3 billion wireless subscribers (White, Beamish, and Mazutis 763). In part, this trend can be explained by the development of such countries as India or China where companies can find more customers. Additionally, there are several distinguishing features of the market for smartphones. First of all, one can say that the increasing number of customers want to use devices that can act as mobile phones, organizers, and Web applications. Buyers tend to set higher performance standards for handheld devices. This is the reason why the demand for smartphones has risen dramatically in a great number of countries. Moreover, this market is affected by such trends as the development of high-speed wireless networks and the increasing willingness of users to browse the Internet with the help of handheld devices (White, Beamish, and Mazutis 763). Therefore, one can argue that the market share of smartphones is most likely to grow shortly. These are the main trends that one can identify.
How is the wireless phone industry changing? What are the underlying drivers of change and how might those driving forces change the industry?
As it has been said before, the wireless phone industry is becoming more oriented to the production of smartphones and the development of software solutions that support such devices. Overall, there are several drivers that prompt companies to change their strategies. One of them is the changing needs of customers who tend to set new requirements for mobile devices. Yet, there is another driving force that should not be overlooked. In particular, it is necessary to focus on technological innovation because a single product can affect customers’ attitudes toward handheld devices. For example, the arrival of the iPhone has demonstrated the capabilities of smartphones and stimulated the demand for these products.
Additionally, the companies that represent this industry have to modify their policies to respond to the increasing competition. For instance, such corporations as Apple or Google attempt to enter the market that has been dominated by RIM (White, Beamish, and Mazutis 764). Therefore, this company has to address these challenges and retain the loyalty of customers. Each company has to face the fact that their products should be constantly improved; otherwise, they may soon become obsolete. This is the main difficulty that these businesses have to overcome. So, it is necessary to focus on the following factors: 1) the changing demands of customers; 2) technological innovation, and 3) competition among manufacturers.
What strategic approach has Research in Motion chosen to employ in international markets? Would you characterize its strategy as a global strategy or a localized multicountry strategy? How has it utilized location to build a competitive advantage?
It is possible to say that currently Research in Motion prefers a localized multi-country strategy and they have not tried to expand geographically (White, Beamish, and Mazutis 765). This organization cannot be called a global company such as Microsoft or Google. First of all, it should be noted that their operations are conducted primarily in Waterloo, the city where RIM was founded (White, Beamish, and Mazutis 765). Secondly, this company carefully selects the locations for its operations. In particular, these places should have sufficient pools of talented engineers and developers who can meet the company’s performance standards (White, Beamish, and Mazutis 768). Currently, the company conducts its operations in Canada, England, and the United States; moreover, it has acquired a company in Israel. Nevertheless, one should remember that this strategy gives RIM several competitive advantages over other firms. First of all, the management of the company can better control the core business processes and safeguard their intellectual property rights. By recruiting students from Canadian universities, RIM has been able to create a culture that appeals to many employees (White, Beamish, and Mazutis 766). Finally, this company operates in countries that have similar business cultures and they do not have to face the challenges related to the differences in legislation or labor relations. These are the main benefits that their strategy yields.
How important is it for Research in Motion to increase the size of its pool of software developers? What are the different options for substantially increasing its R&D staff?
On the whole, this company greatly depends on the efficiency of their Research and Development (R&D) efforts. This is why they should recruit the most skilled software designers and engineers. As it has been said before, this industry is driven by technological innovation, and RIM needs to respond to the new challenges. So, this task is important for the sustainability of Research in Motion. Different strategies may enable the company to increase its R&D staff. One of the approaches is to scout for talented employees in different countries such as China, India, Russia, Israel, and so forth.
This approach is currently adopted by Microsoft, Apple, Nokia, and other companies. These organizations want recruits to understand and integrate into the corporate culture (White, Beamish, and Mazutis 767). Additionally, many companies prefer to outsource some of their activities abroad. For instance, Motorola opened its offices in such countries as South Kora, Vietnam, China, and India (White, Beamish, and Mazutis 769). Very often they prefer to acquire small IT companies in these countries. This strategy gives them access to a skilled and less expensive labor force. Furthermore, companies operating in this industry establish companies with different universities that can perform some of the R&D activities (White, Beamish, and Mazutis 770). Again, this approach is primarily aimed at cost-reduction. These are the main options that are available to RIM.
Which option for increasing the number of software developers should Research in Motion pursue? Explain how your recommended course of action is consistent with Research in Motion’s resources, organizational capabilities, and management preferences.
It is possible to say that RIM should focus primarily on the recruitment of students and IT professionals from Canada and the United States. Furthermore, their scouts should search for skilled employees in such countries as China, Russia, or India. These recruits should have an opportunity to work in Waterloo or other offices previously established by RIM. There are several rationales for this recommendation. First of all, the company is one of the most popular employers in the mobile phone industry. Furthermore, many software developers will be willing to move to Canada or the United States if they have this opportunity. Additionally, this strategy will enable the managers of RIM to maintain a unique culture that emphasizes innovation, egalitarian relations, and empowerment of employees. Certainly, this organization may prefer to outsource their activities to other countries in which companies find many skilled employees who may require lower wages. However, the problem is that RIM will have to operate in countries with different business, culture, labor legislation, and copyright laws. Therefore, the leaders of RIM may find it more difficult to control every business process. This is why RIM should focus on extensive recruitment of candidates for their R&D department.
White, Rob., P. Beamish, and D. Mazutis. “Research In Motion: Managing Explosive Growth.” Crafting and Executing Strategy: Concepts and Cases. Ed. Arthur Thompson and John Gamble. New York: McGraw-Hill/Irwin, 2011. 758-774. Print.