The Trouble With Microsoft

I have been reading the Mini-Microsoft blog. Man, does he paint a negative picture of Microsoft. The company comes across as floundering and ineffective. Consumed with forced rankings in performance reviews and seemingly unable to ship out products in a timely fashion.

I watched Steve Jobs last night here. He was announcing yet another wave of new products. Innovative. Exciting. The way I used to remember Microsoft. I found myself being inspired by his genuine passion for creating really cool products.

So what is the problem at Microsoft? BusinessWeek asked Jobs that question. Fascinating dialog:

Q: What can we learn from Apple’s struggle to innovate during the decade before you returned in 1997?
A: You need a very product-oriented culture, even in a technology company. Lots of companies have tons of great engineers and smart people. But ultimately, there needs to be some gravitational force that pulls it all together. Otherwise, you can get great pieces of technology all floating around the universe. But it doesn’t add up to much. That’s what was missing at Apple for a while. There were bits and pieces of interesting things floating around, but not that gravitational pull.

People always ask me why did Apple really fail for those years, and it’s easy to blame it on certain people or personalities. Certainly, there was some of that. But there’s a far more insightful way to think about it. Apple had a monopoly on the graphical user interface for almost 10 years. That’s a long time. And how are monopolies lost? Think about it. Some very good product people invent some very good products, and the company achieves a monopoly.

But after that, the product people aren’t the ones that drive the company forward anymore. It’s the marketing guys or the ones who expand the business into Latin America or whatever. Because what’s the point of focusing on making the product even better when the only company you can take business from is yourself?

So a different group of people start to move up. And who usually ends up running the show? The sales guy. John Akers at IBM is the consummate example. Then one day, the monopoly expires for whatever reason. But by then the best product people have left, or they’re no longer listened to. And so the company goes through this tumultuous time, and it either survives or it doesn’t.

Q: Is this common in the industry?
A: Look at Microsoft — who’s running Microsoft?

Q: Steve Ballmer.
A: Right, the sales guy. Case closed. And that’s what happened at Apple, as well.

5 replies
  1. michael
    michael says:

    An interesting perspective, but so off the mark. Do people really think that Steve Ballmer runs the show? If the ‘sales guy’ runs the show, then why was the last 1/2B of investment channeled into R&D?

    As to shipping products, I also find this interesting. While Apple has come up with a great widget, (It saved Apple), the question becomes what is sustainable? Is there a broader value proposition?

    People tend to forget that while companies like Apple do well in their niche markets, (Google is another example of this) Microsoft is going after every market. Consumer, small medium business, enterprise. No other company in the market has that spread – not IBM, Oracle, or Apple.

    The burden of this is that the company has seen products slip. But another question, is that not expected? Vista will be the single largest software project ever completed by mankind …. And in the next 18 months, Microsoft will ship more products than they have in 3 years. SQL 2005, Biztalk 2006, Windows Vista, IPTV (SBC launches in December, Bell Canada 2006), Office 2006, XBOX 360, a revamp of MSN and a laundry list of new apps, new versions of MSN CRM and Dynamics, Small Business Accounting 2006, Visual Studio 2006, Business Scorecard Server 2006, Windows Server 200 R2, Connected Services Framework 3.0, and on and on …. (Including a number of very interesting NDA plays).

    The next 18 months will be very interesting. The value that Apple, Google and Linux provide Microsoft is that they provide the rally cry. Microsoft is never stronger than when there is a strong competitor.

    In the end, that benefits the consumer.

  2. michael
    michael says:

    I leave you with one last thought …. Halo 2 and XBOX.

    Halo 2 is the single best selling video game of all time, a MS title. In a single day it sold more copies than any video game or entertainment device (i.e. Any first day movie launch) in history – $125M USD.

    In November Microsoft will launch the XBOX 360 in a) Every single WW market (A first) b) 6 months ahead of Sony c) with more than 200 titles in development for the platform d) with market lead over Sony in Canada (XBOX sells more than Playstaion in Canada) e) with a truly remarkable integrated integration story (Links in IPTV, Media Center and Live service) f) with Halo 3 in development for the day the Sony Playstation 3 launches.

    Sony is a great competitor. They bring out the best in Microsoft.

  3. richard cleaver
    richard cleaver says:

    Off the mark? The objective view is the stock price.

    And, at the end of the day, the sales guy running Microsoft is responsible for the dismal performance of the company’s stock. Let’s hope that he does get the company to rally.

    To your point on competition… Microsoft does not like competition. It likes to take out competition. And in a way that does not bring out the best in business practices. Of course, Microsoft has paid the price for some of that past behaviour as Sun and Real Networks will attest 😉

  4. Matt S
    Matt S says:

    halo RULES!!


    *looks to his xbox 360 preorder reciept, pinned triumphantly on the wall*

    I must be the only non anti-microsoft nerd in North America right now….but I’m sure things would be different if I was still taking programming courses. Hehe.

    “Blue screen of death! Ahhhhh…..”


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