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BlackBerry Ltd.'s decision to dump its CEO is a black mark on its board of directors. Not because dismissing Thorsten Heins is a mistake – but because the board never should have put him in the corner office in the first place. He was the wrong leader with the wrong strategy at the wrong time. The board seriously misjudged what the floundering company needed – a colossal fumble that cost BlackBerry nearly two years, almost $5-billion of market value, and quite possibly its only decent chance for survival.

Early Monday, the battered smartphone maker called off its proposed sale, replacing it with a $1-billion convertible debt issue. In conjunction with the financing, it dismissed Mr. Heins, the BlackBerry insider who had served as CEO since January, 2012. He is succeeded, at least on an interim basis while an outside search is conducted, by former Sybase Inc. chairman and CEO John Chen – himself an outsider from BlackBerry's inner circle.

Mr. Heins was a capable BlackBerry executive who was hand-picked by Jim Balsillie and Mike Lazaridis when the pair stepped down as co-executives and co-chairmen early last year. It was certainly time for Mr. Balsillie and Mr. Lazaridis to step aside. BlackBerry had been on the wrong path for too long, stubbornly (or arrogantly) following a flawed and failed strategy.

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What BlackBerry desperately needed was new blood and a new direction – a skilled and experienced turnaround artist who wasn't wed to the company's past and who would re-make it for the future. What it needed was another Lou Gerstner, the outsider credited with turning around a deeply dysfunctional and strategically moribund IBM Corp. in the 1990s.

Instead, the board agreed to go with more of the same. It accepted Mr. Lazaridis and Mr. Balsillie's choice as their successor, and indeed, both Mr. Heins and the company's new chairman at the time, Barbara Stymiest, insisted that they had no intention of taking BlackBerry in a new strategic direction.

How much of the decision to go with Mr. Heins was acquiescence to the company's powerful founding fathers, and how much was a wrong-headed belief that the company's failings were a matter of poor execution rather than a poor strategy, is hard to say. Either way, the board demonstrated an inexcusable lack of vision. Now, nearly two years later, the choice, both in leadership and strategy, has only left the company nearly two years further down the road to ruin.

The board is finally making some aggressive changes that it should have made back then – including something of a re-make of the board itself. Mr. Chen becomes executive chairman, while Mr. Watsa, who had stepped down from the board while his company considered a takeover bid, returns. Mr. Heins and fellow director David Kerr are out. Ms. Stymiest is vacating the chair to make way for Mr. Chen, but remains on the board.

But it may simply be too late. Another 21 months of missteps under Mr. Heins – another series of failed products that have failed to recapture consumer imagination or market share – have left the business in a hole that looks impossible to climb out of. If that's the case, the stay-the-course management choice of early 2012 may go down as the moment the board inadvertently sent its own company to doom.

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