RIM Keeps Manufacturing Out of China

This one act has probably done more to show the world that RIM is in it to win it than any other so far this year – RIM is staying out of China.

The Huffington Post had a really great article in it yesterday. The article described how Thorsten Heins, RIM’s CEO, has made an operational decision to stay out of China. Specifically speaking, despite the cheap labor and lax environmental laws, RIM’s manufacturing operations won’t be moving there… ever.

The immediate question is, “why is this important?” That’s really quite simple. Historically, it’s been very easy for Chinese companies to “acquire” intellectual property and produce like and/or competing products and services from companies operating within their borders. In many cases, government officials order, intimidate, cajole, or otherwise “make” Chinese workers cough up the information.

Shortly after that happens it’s not been unheard of for foreign companies to lose or be underbid for work because a Chinese organization introduces a like product and wins a contract or business with that illicitly gained information. This is a well-known occurrence for organizations with operations in China.

RIM is in butt-saving mode. Its cutting staff, cutting costs etc., trying to insure that it has enough staying power to release BB10 and the new devices that run it. The one thing it won’t be doing to save money on manufacturing costs.. ? Moving its manufacturing operations to China.

This is huge step in the right direction for RIM; and it may be the first thing they’ve done right this year. This decision protects RIM’s reputation, RIM’s current product line and most importantly, RIM’s customers from rogue Chinese government sponsored hackers running amok through RIM’s enterprise, or YOUR enterprise because the Chinese were able to hack through BIS/BES. It protects RIM’s most valuable asset – its security features. It also protects RIM’s value

Despite the fact that RIM could have saved a great deal of money on operating expenses, Heins has likely saved the company by keeping the company out of China.

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