Thorsten Heins was blunt but compassionate when he detailed the reduction of headcount that RIM announced today. He said that RIM currently has about 16,500 employees globally and will be reducing it by at ~5,000 to somewhere in the 11,500 range. He stressed that RIM is trying to be responsible and respectful especially to the different cultures and uncertainty that these employees are experiencing. Heins explained that a function of this may be outsourcing certain functions to other companies that have a better economies of scale for that function but are not central or core to the business. All of this is set to happen by the end of Fiscal 2013 which gives them less than 9 months.
RIM has already started doing this by outsourcing key parts of the companies Global Repair operations including management of device level repairs. Here are the key initiatives in this CORE program:
-- a reduction in the number of layers of management to drive better clarity, efficiency and accountability across the organization; -- the continued streamlining of our supply chain, which includes the consolidation of our manufacturing footprint from 10 external manufacturing sites to three, and working closely with our suppliers and other partners to identify ways to drive further efficiency; -- outsourcing key parts of the Company's Global Repair operations, including management of device level repairs; -- targeted use of resources in our sales and marketing initiatives to more effectively leverage marketing windows and prioritize our marketing efforts and spend in regions that offer the highest opportunity and return; -- further outsourcing of non-core functions as determined during the implementation of the CORE program; and -- a global workforce reduction of approximately 5,000 employees, which is expected to be completed by the end of fiscal 2013.
To all of you who will no longer be working at RIM I wish you the best of luck in future endeavors. Our thoughts are with your and your families. Hopefully this sacrifice will allow RIM to lean down for the tough road to the BlackBerry 10 launch and rollout.