John Paczkowski

Recent Posts by John Paczkowski

More Layoffs Looming at RIM

For Research In Motion, summer layoffs are becoming an annual event.

In July of 2011, the struggling maker of BlackBerry smartphones sacked 10 percent of its global workforce — some 2,000 employees — as “a prudent and necessary step for the long-term success of the company.”

Now it’s gearing up to do it again.

Sources close to the company tell AllThingsD that RIM will soon announce another major global restructuring that will include “at least” 2,000 layoffs. “RIM has about 16,500 employees worldwide now,” one source said. “That number will be down to 14,500 before the summer’s over. … 14,500 or less.”

The cuts are expected to be companywide, with every division — from marketing and sales to legal and operations — taking some kind of hit. Expect a few executives to leave along with the rank and file. In other words, it’s looking like it’s going to be at least as bad as the last round of layoffs. And it’s already begun: according to some sources, RIM has already been furtively sacking small groups of employees — no more than 10 or so — in an effort to keep the cuts quiet.

News of the looming restructuring was first reported by the Globe and Mail, which says the planned layoffs could be announced as soon as June 1 — just one day prior to the end of RIM’s first quarter.

Another unfortunate turn of events for RIM’s long-suffering workforce. But really, after the missed targets, the slashed financial outlooks and the decision against providing earnings and revenue guidance, it seemed inevitable. Remember, RIM CEO Thorsten Heins has vowed to improve execution at the company, streamlining operations and saving $1 billion by the end of fiscal 2013. His plan for achieving that, as explained by CFO Brian Bidulka: “Primarily by optimizing the cost position of our products and services and improving overall resource effectiveness and organizational efficiency.”

A well-worn corporate euphemism for “layoffs.”

So, really, RIM’s leadership said they were going to sack a bunch of folks months ago. And now that’s exactly what they’re doing.

“… It is now very clear to me that substantial change is what RIM needs,” Heins said during the company’s grim first-quarter earnings call. “I am focused on creating long-term value for this company, and I’m committed to do whatever it takes to deliver on that commitment.”

Whatever it takes.


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