Computerworld, 8 November 2010, has an article called “Ozzie to Microsoft: Simplify, Simplify.” Unless Microsoft can become nimbler and less bureaucratic, they will not be able to keep pace with technology change in the marketplace.
Ray Ozzie, Microsoft’s departing Chief Software Architect (and Bill Gate’s successor since 2006) has prepared a five-year plan for the company that “exhorts the company to push further into the cloud—or perish.” (Hence, a recent Microsoft stock price that is half of what it was more ten years ago!)
According to Ozzie—and I believe most technology architects today would agree—the future of computing is far less about the PC and Windows and much more about mobile devices and services, which are not traditional core competencies of Microsoft.
The new technology landscape is one that is based on:
- Mobility—access anywhere (smartphones, tablets, and embedded appliances)
- Pervasiveness—access anytime (24/7, “always on”)
- Shared services—access that is hosted and shared, rather than device or enterprise-based.
Despite seeing the future, Microsoft is having trouble changing with the times and many are questioning whether they are in a sense a “one pony show” that can no longer keep up with the other technology innovators such as Apple, Google, Amazon, and others that seem to be riding the mobility and cloud wave.
Wes Miller, a technology analyst, states about Microsoft: “My frustration is that it’s a big ship, and the velocity with which the boat is going will make it hard” for them to move from a PC-centric to a cloud-oriented world. “You’re talking about competing with companies that are, if not out-innovating Microsoft, then outpacing them.”
With the deep bench of intellectual talent and investment dollars that Microsoft has, why are they apparently having difficultly adjusting with the changing technology landscape that their own chief architect is jumping up and down screaming to them to confront head-on?
To me, it certainly isn’t ignorance—they have some of the smartest technologists on the planet.
So what is the problem? Denial, complacency, arrogance, obstinance, accountability, leadership, or is it a combination of these coupled with the sheer size (about 89,000 employees) and organizational complexity of Microsoft—that Ozzie and Miller point out—that is hampering their ability to effectively transform themselves.
This certainly wouldn’t be the first time that the small and nimble have outmaneuvered lumbering giants. That’s why according to Fortune Magazine, of Fortune 500 companies, only 62 have appeared on the list every year since 1955, another 1,952 have come and gone. It’s sort of the David vs. Goliath story again and again.
While Microsoft is struggling to keep pace, they are fortunate to have had people like Ray Ozzie pointing them in the right direction, and they have made major inroads with cloud offering for Office365 (Office, Exchange, SharePoint, and Lync—formerly OCS), Windows Azure (service hosting and management), and Hyper V (for server virtualization).
As I see it, Microsoft has 3 choices:
- Change leadership—find someone who can help the company adapt to the changing environment
- Break up the company into smaller, more nimble units or “sub-brands,” each with the autonomy to compete aggressively in their sphere
- Instead of focusing on (the past)—base product enhancements and the “next version,” they need to be thinking completely outside the box. Simply coming out with “Windows 13” is a bit ridiculous as a long-term strategy, as is mimicking competitors’ products and strategies.
As is often the case, this is really isn’t so much a question of the technology, because Microsoft can certainly do technology, but it is whether Microsoft can overcome their cultural challenges and once again innovate and do it quickly like their smaller and more agile rivals.