Business lesson from BlackBerry’s plight: Only the paranoid survive

But I will be doing you an injustice if I don’t give context to this story. In 2009 a new member joined our team at Outdoors Africa. Nick came in as the associate director in charge of business development. He had come from a telecommunications company.

Before Nick came, my colleagues and I were happy with our basic phones popularly known as Mulika Mwizi. The first thing he did was compel us to get a phone that was seen as a status symbol.

Secondly, we needed a low-cost mobile data phone. (That was before the advent of bundles so data cost quite a bit.) And those of us with that phone could exchange messages for free using their messenger service. This made them affordable and well-suited to our mobile networks.

Your guess is as good as mine. Nick made sure we bought BlackBerrys. BlackBerry was the first firm to effectively put e-mail into the pockets of business folk around the world.

Its elegant system worked anywhere and was bandwidth and data-efficient. When I look back on the heyday of the BlackBerry brand, I’m reminded of how deeply it was connected to the business community.

In other words, it was seen as a symbol of those who had made it professionally.

There has not been a technology that so quickly penetrated the consumer market as smartphones did, with BlackBerry being the innovator. I even remember President Barack Obama holding up his BlackBerry and saying, “I cannot live without my BlackBerry.”

Today, the brand is regarded as the mother of all disruption stories.

So what went wrong? Within a year or two of the iPhone disruption, BlackBerry knew of the grave dangers to their business. Yet they were never able to respond effectively, even as Google and its Android division showed it could be done.

They missed out on what we call productive paranoia. Let me explain. Any successful company receives plenty of signals that it is succeeding.

Look again at how BlackBerry’s share price surged, even as Apple and Google entered the mobile phone market. One of the basic challenges of transformation is that by the time the data is convincing, it’s too late to really do anything about it.

A company with healthy paranoia distrusts the data and is restless in its search to create tomorrow’s business model. Companies are always exploring new market spaces.

If you read reports of efforts at BlackBerry, you see telltale signs of the curse of abundance: they debated and pondered and compromised.

By contrast, the paranoid organisation innovates with a degree of ferocity that allows it to keep pace with radical changes in the marketplace.

Intel’s Andy Grove warned years ago in a book that only the paranoid survive. Such paranoia can only result from consistent and regular mechanisms to tap into the industry’s periphery — the place where new trends and technologies emerge.

And guess what? The race is now faster than ever. It’s very difficult to stay ahead. Those barriers don’t exist any more. These days you’re an algorithm away from some pretty serious competition.

Look at what everyone, including Apple and Mark Zuckerberg, are trying to do with payment systems. There is going to be a lot of disruption.

The worst mistake you can make is to think that you’re better, you can out-muscle or out-handle the competition. I don’t think you can. Ask BlackBerry.

Mr Waswa is a management and HR specialist and managing director of Outdoors Africa. [email protected]