Hold up an iPad and a PlayBook and you see one tablet device that’s clearly a hit with consumers, and one that isn’t.
Compare the boards of the two companies behind the products – Apple Inc. and Research In Motion Ltd. – and the differences are even more striking.
Sitting at Apple’s board table are some of the most powerful consumer products executives in the world: Robert Iger, chief executive officer of Walt Disney Co., Andrea Jung, chairwoman and former CEO of Avon Products Inc., and Mickey Drexler, who built the Gap into a retail powerhouse and now runs J. Crew Group Inc.
If high-level consumer products experience is a theme among Apple directors, accounting is the specialty around the RIM board table. There are four accountants on its 11-member board, including chairwoman Barbara Stymiest and ex-CEO Jim Balsillie. Only Claudia Kotchka, a retired Procter & Gamble executive, has senior-level consumer products experience other than the RIM insiders.
RIM’s move to make Ms. Stymiest, a Bay Street veteran, chairwoman and bring investment expert Prem Watsa of Fairfax Financial to the board is a solid first step, corporate governance experts say. But for RIM to push its executive team in the battle against Apple and other tech giants, more board moves will be needed.
The Apple board has a breadth of outside technology industry experience, including the former CEOs of defence contractor Northrop Grumman Corp., tax software specialist Intuit Inc. and biotech heavyweight Genentech Inc. The RIM board’s techies, other than RIM insiders, number two: a retired senior executive with European telecommunications firm Telefonica SA and the former head of IBM Canada.
“One of the main things Barbara Stymiest has to do is to bring more talent on the board ... and ask some of the people to leave. She needs to do this in the next six to nine months,” said Beverly Behan, a New York-based adviser to boards of S&P 1500 firms and author of Great Companies Deserve Great Boards. Although the RIM board “has just made some important and difficult decisions,” more work needs to be done to add expertise in technology, Asia and consumer products, she said.
“RIM needs an infusion of new directors on the board who understand and are deeply rooted in the business,” said David Anderson, president of Anderson Governance Group, a Toronto-based adviser to the boards of large Canadian and international companies. “If a board is to serve its function to be in a position to challenge management on a regular basis in the interests of the company – this is not a board that’s well composed to do that.”
In a statement sent to The Globe, RIM said it believes its board “is highly qualified and that the RIM board members' experience speaks for itself,” RIM said in a statement, pointing out that in addition to a co-founder, board members have experience in technology, telecom, banking, education and consumer goods.
Ken Wong, a marketing and business strategy professor with the Queen’s School of Business, said the board should consider adding an expert in payments technology, either from a credit card company, a major retailer or data powerhouse Equifax – “somebody who would give them insight into how to make this good engineering technologically more usable.”
Mr. Anderson said the board should ask if Ms. Stymiest herself is the right person for the job of chair. “The chair must have the authority and respect among directors and with the CEO to lead,” he said. “Is the new chair the right person? Does she know what needs to be done and can she rally the board? Will she coax and guide the board to courageous decisions?”
Ms. Stymiest didn’t respond to a request for comment.