A snowstorm stranded former Motorola executive Larry Conlee in Waterloo, Ont., one night in late 2000. He had flown up from Chicago for a job interview with Research In Motion. His first meeting with founder and co-CEO Mike Lazaridis was scheduled at 4 p.m., but given Conlee couldn’t fly home that night, the two went for dinner and ended up talking strategy for hours. Lazaridis was particularly interested in hearing about Conlee’s ideas on how RIM could boost its manufacturing volume, and Conlee was more than happy to oblige.
He was offered the position of chief operating officer of engineering and manufacturing at RIM shortly afterward, and joined RIM the following January. “He’s been one of the most critical additions in the history of the company,” says Barry Richards, a senior analyst at Paradigm Capital in Toronto.
Conlee, 62, has worked in obscurity, at least compared to the flash of co-CEO Jim Balsillie. But his impact has been significant. In 2001, the company’s manufacturing and supply chain capabilities were fairly basic. RIM shipped approximately 400,000 wireless devices to a handful of carriers that fiscal year, and new customers were clamouring for RIM’s products. The company had to figure out how to ramp up its manufacturing operations to put a BlackBerry in the hand of every needy executive and manager.
Enter Conlee. He orchestrated the explosion in the manufacturing of the BlackBerry, and took the company from shipping fewer than half a million devices a year to more than 30 million in the past four quarters alone. RIM also has 11 production facilities around the world, up from a single Canadian factory a few years ago.
Conlee had plenty of experience coming into the job. He’d spent 29 years at Motorola, a company that had decades to perfect mass production of its devices. At RIM, Conlee introduced the concept of a platform manufacturing strategy, meaning the company produced a core device and modifies it to create different BlackBerry models. “That increased our ability to go from launching one product every year to where now we have major product launches every month,” he says.
Flexibility is also necessary because RIM has to modify the BlackBerry to meet different regulatory requirements in the 160 countries in which it’s sold. The company’s 475 carriers demand customization, too, even for something as seemingly insignificant as the placement of their logos on the BlackBerry. “It’s a very difficult thing to ramp up production and meet all those requirements,” says Gus Papageorgiou, managing director of technology research with Scotia Capital.
But a peek at RIM’s financials shows the operational processes put in place by Conlee have worked. Although the company also makes money through software and services, more than 80% of its $11.1 billion in revenue in fiscal 2009 came from device sales. “They’ve very rarely said demand has exceeded their ability to supply, because they’re able to deliver very quickly,” Papageorgiou says.
However, Conlee won’t be guiding RIM’s success for much longer. The company announced at its annual general meeting in July that Conlee will be retiring this year. “I’m getting to be an older guy,” he says, adding he wants to spend more time golfing and travelling. Conlee is also a budding wine connoisseur. “One of the good things about wine as a hobby is that great wine is in great parts of the world, so there are lots of places to visit,” he says.
A replacement has yet to be named, but analysts say Conlee is leaving the company in a strong position to expand its manufacturing operations. “He’s very good at making surfe he won’t be missed,” Papageorgiou says. “Even though he will be.”
