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RIM Plunges as New CEO Keeps With Status Quo
Scott Moritz | January 24, 2012

Thorsten Heins, who worked at Siemens for more than 20 years, takes over the duties of RIM’s founders Mike Lazaridis and Jim Balsillie, who stepped aside as co-CEOs on Sunday. (Reuters Photo/Geoff Robins) Thorsten Heins, who worked at Siemens for more than 20 years, takes over the duties of RIM’s founders Mike Lazaridis and Jim Balsillie, who stepped aside as co-CEOs on Sunday. (Reuters Photo/Geoff Robins)
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Research In Motion’s Thorsten Heins got off to a rocky start to his tenure as the BlackBerry maker’s chief executive officer.

Investors clamoring for a strategic shakeup were instead told by Heins on a conference call on Monday morning that no “drastic change” is needed. The comments sent the stock sliding, more than erasing a gain of as much as 7.6 percent in early trading.

RIM, which helped pioneer the US smartphone market more than a decade ago, is betting on the management overhaul to stem falling sales and market-share gains by Google’s Android and Apple’s iPhone and iPad. Heins, a 54-year-old German native who spent more than 20 years at engineering giant Siemens, said that he promotes “creativity, innovation and free thinking” and that he is ready to go head-to-head with the Silicon Valley rivals.

“We need to fight back and get stronger,” Heins said in an interview. “You will see and hear much more from us.”

Heins, who is replacing co-CEOs Jim Balsillie and Mike Lazaridis, joined RIM four years ago after more than two decades at Siemens in roles ranging from research and development to product management. He was one of RIM’s two operating chiefs, overseeing engineering, hardware and software.

RIM slumped 8.5 percent to $15.56 at the close in New York on Tuesday after rising as high as $18.29 in early trading. The stock has lost 89 percent since its peak in 2008, when soaring BlackBerry sales pushed RIM’s market capitalization to more than $80 billion, making it the most valuable company in Canada. Its sales have now declined for two straight quarters, and its market value stands at $8.2 billion.

“I’m a German and this is what I like to talk about: the process discipline,” Heins told investors on the conference call. In the interview, Heins plans to continue on the strategic path laid out by his predecessors. Lazaridis will be vice chairman and lead the board’s innovation committee, providing counsel to the CEO.

“It’s hard to see how this change can impact the company’s course,” Ittai Kidron, an analyst at Oppenheimer, told investors in a note on Tuesday. “RIM’s previous leadership is still involved so their influence is there and important. We believe this could make it difficult for Mr. Heins to make changes without their approval.”

Balsillie and Lazaridis, who guided RIM together for two decades, said the decision to step down and appoint Heins was theirs. Lazaridis, who founded the Waterloo, Ontario-based company in 1984, said the shift is a result of the company’s evolution and the introduction of new technologies that will give RIM more competitive products.

Heins’s top challenge will be to lead RIM’s transition to next-generation products running on a new operating system, which has suffered from delays. In December, RIM said the first BlackBerrys based on the new system, called BB10, won’t be available until the latter part of this year.

Bloomberg