Is Microsoft too slow to innovate? + Ballmer the man of the situation?

[HeyCori]

The guy in charge of the Xbox division was doing a good job and Ballmer just fired him. Then he named himself boss of the Xbox division right after ruining it (for me). I just can't appreciate his work.

That's a flat out lie. Don Mattrick willingly quit to become CEO of Zynga. In fact, the co-founder of Zynga even stated that he purposely recruited Don for CEO.

Don Mattrick Is Now the CEO of Zynga [UPDATE: Mattrick weighs in]

Today is a big day. I?m excited to announce that Don Mattrick will be joining us as Zynga?s new CEO and member of our Board. I wanted to let you all know why I made the decision to recruit Don and what I think it means for all of us.

And here you are blaming Ballmer because Don has the opportunity to become CEO of another company. And Ballmer only made himself head of the division long enough to finish the reorganization and then he passed it off.

Considering we've done this dance before, this is simply Tupper's monthly I hate Ballmer thread where all he does is spread FUD in an attempt to discredit everything Ballmer has done. Everything he says should be taken with a HEAVY grain of salt.

 

[Simon Tupper]

I hate Ballmer[/I] thread where all he does is spread FUD in an attempt to discredit everything Ballmer has done. Everything he says should be taken with a HEAVY grain of salt.

I haven't posted in months........ And im generally positive about MS.

 

[Simon Tupper]

I'm not saying that Ballmer should be perfect, but seriously... The guy should at least let someone else take care of every interview. They need to rebuild the company's image and a quick way to do so is to change the face everyone associate with the company. Ballmer isn't good in public relations and its a very important part of his job. Add to that the relatively low number of sales and I don't think anyone should blame me or the medias to dislike his work.

 

[stmav]

Again, no one is blaming anyone. But it's also a matter of personal opinions. Not everyone agrees with that outlook of Ballmer. And as far as the media, I'm not sure it matters who is CEO, as long as it's Microsoft, the opinion will be the same. But there really is no need to create another thread about this. Just add any new information to one of your existing ones.

 

[Simon Tupper]

Again, no one is blaming anyone. But it's also a matter of personal opinions. Not everyone agrees with that outlook of Ballmer. And as far as the media, I'm not sure it matters who is CEO, as long as it's Microsoft, the opinion will be the same. But there really is no need to create another thread about this. Just add any new information to one of your existing ones.

Creating a new thread makes it easier for everyone to understand my point of view on the new information I'm adding to the subject. While adding it to an old thread is ineffective and would only create confusion resulting in people talking about the old subject.

 

[stmav]

When the subject is the same thing, which in case calling out Ballmer and Microsoft being slow, there is no need for another thread. Per your forum rules.

[INFO]
Cross Posting - Do not post duplicate questions or topics in multiple forums or threads.[/INFO]

Again, no one is saying not to state your point of view, please do. But there is no need for multiple threads.

 

[Robert Carpenter]

The guy in charge of the Xbox division was doing a good job and Ballmer just fired him. Then he named himself boss of the Xbox division right after ruining it (for me). I just can't appreciate his work.

This is incorrect information. He left, he wasn't fired. Please don't try to say otherwise because it was proven.

The restructuring of the company is going to fix a lot of these problems that you are talking about. I'm not going to explain how and why they will fix it because it's very involved, but it is definitely going to help their products come together better.

 

[ag1986]

This is incorrect information. He left, he wasn't fired. Please don't try to say otherwise because it was proven.

The restructuring of the company is going to fix a lot of these problems that you are talking about. I'm not going to explain how and why they will fix it because it's very involved, but it is definitely going to help their products come together better.

This is not really true. Ballmer restructured MS into what we call a functional organisation as opposed to what it used to be, a divisional organisation. This is not a good thing; we were discussing this in my part-time MBA study group.

MS' current org structure is an imitation of Apple's and that is a bad idea. Apple has very few products, all of which are tightly controlled and integrate very well and are predominantly oriented towards the consumer market. Jobs was, and now Cook is, aware that such a hierarchy can only be viable when you have a very small number of products. They have basically: iPhone, iPod, iPad (which are basically the same), Macs and a software division.

MS has a wide range of products with an equally wide range of targets, from the corporate IT market to the gamer. There are at least ten products with a $1B+ run-rate (fun fact - the iPhone alone makes more money than all of MS put together). Under their current org structure, each function (Marketing, Engineering, Finance et al) are under one VP while each product cuts across these functions. So where before you had one integrated division in charge of Xbox development, programming, marketing and whatnot, each of those are split across the organisation. That's going to impact collaboration and focus.

Every organisation of any size is structured divisionally. Please see strat which echoes most of my thoughts.

 

[ag1986]

Interesting point of view OP...

Microsoft Research have "innovated" virtually every major technological advance in the mobile/PC/tablet space over the last 15 years. It's the "implementation" of those ideas has been severely lacking.

You look at almost everything Apple or Google have done and the chances are MS had a product like they have 3 or 4 years previously they just failed to market it or chose not to.

Why is it do you think that MS gets royalties from both of them for every device they sell?

The way I see it from a business standpoint they have it pretty much spot on. They have been earning money from competing devices via patents and software licensing for years and now they are restructuring and pushing out great hardware and software of there own.

I haven't heard of MS getting royalties from Apple. As far as Android goes, most of the patent revenue is from licenses for FAT32, which is what allows consumers to plug phones into Windows PCs.

Also, the iPhone alone makes more money than all of MS (or at least it did sometime last year - not sure exactly when).

MS are basically late to the Web game and the consumer hardware space. Apple saw the latter opportunity and jumped on it, MS figured corporate licensing was all they needed. Google saw the potential of the Internet, to which MS was always a latecomer. While I don't deny that MS (Gates' MS, not Ballmer's) has done great things, I really haven't seen anything (consumer not enterprise) that was well-conceived and executed from them in the last few years (WP-no market share, W8 - debacle etc). I will however give you Xbox, but postulate that Xbox did well in spite of MS' management and not because of it.

 

[bilzkh]

If the reorg is of any indication, I think Ballmer is on the right track with his decisions.

By making MS a more functionally-driven organization he is ensuring that each product and service MS produces supports its sibling-products/services, and that *everyone* in the company is on the same page. And for what it's worth, Ballmer's MS is still a profitable company.

 

[a5cent]

Ballmer restructured MS into what we call a functional organisation as opposed to what it used to be, a divisional organisation. This is not a good thing; we were discussing this in my part-time MBA study group.

In general, and taken out of context, I would agree with your assertions, yet I don't think they apply to Microsoft in this situation. Particularly for a software engineering company (at least primarily), that strives to improve integration between and across all of their products and services, I think a more functional organisation makes sense. If Microsoft built washing-machines and microwave-ovens, I would completely agree with everything you mentioned, but software development is a very different beast.

The WP and Windows teams should have been organised this way back in 2010. There was no unified vision of where these two OS' were headed, which is why they now have conceptual differences in too many places. The WP team is still working on a lot of "plumbing", most of which revolves around merging these differing concepts. That is always difficult, but now even more so, since both OS' have already shipped. Had the WP and Windows teams been more functionally organised, the WP team would be at least a year ahead of where they are now.

Going forward, these types of divergence errors must be avoided, but this will involve not just WP and Windows, but also XBox, the developer tools unit, Exchange Server, SkyDrive and many other products. There is no way to do that except by pulling all those groups closer together. If they are going to be working together that closely in reality, then it's better to reflect that officially in the organisational charts as well.

Yes, some focus will be lost. Collaboration will be greatly improved however. Not just in terms of communication, but in terms of building a shared vision for related products to align with.

Compared to the purely divisional organisation they had thus far, which Microsoft adhered to not out of free will, but mainly due to restrictions set by government regulators, I think this can only be a good thing. I think this move was long overdue.

 

[awkm]

Compare the MS of 2007 when the iPhone arrived to the MS of today.

They've released plenty of products and services that are different and interesting.

 

[willysocks2222]

The biggest problem was the internal politics.

Ballmer has fixed this problem and I reckon he should of done it two years ago but again I have a feeling he needed Sinofsky to finish Win 8 before he got rid of him.

All I know is that it's looking better now for them and I can finally expect excellent integration between WP, W8 and Xbone.

 

[ag1986]

Sorry, I should have clarified better.

A functional org works when all your products are targeted towards the same people, it promotes collaboration and that single-vision concept people mention here.

However, MS' actual revenue generators are NOT Xbone, WP, et al; in short, not consumers.

MS makes money from enterprises and from hardware OEMs.

The vision of say, the Office and Server teams is not likely to be congruent with the Xbox or WP teams, and this is a pitfall. MS may have just killed the goose that lays the golden eggs.

 

[a5cent]

Xbox is the only product MS targets exclusively at consumers. Windows, WP, SkyDrive, Skype, etc. are targeted at consumers as well as corporations. All those bi-market products and services have at least some functional overlap with the Xbox though, so even for the Xbox, MS still has something to gain from a functional reorganization. Also consider that all of MS' products are currently going through a transitional phase, where ever more functionality is being moved to the cloud, including features like backup services (for Windows, Xbox and WP, as well as many enterprise products), and backend IT management solutions like InTune. So, here too we encounter a lot of functional overlap, possibly resulting in a unified cloud strategy, that a more functional organization can better deal with.

I get your point though. Every organizational structure has benefits and drawbacks. Some products probably have very little to gain from such a reorganization. I imagine SQL Server might be one such product. I fully expect that MS won't reorganize such units to the same degree they do others.

IMHO how well this ends up working is largely a matter of getting the details right (which aren't apparent in org-charts) and the quality of their management teams.

 

[Robert Carpenter]

Xbox is the only product MS targets exclusively at consumers.

I think that is actually about to change with next gen. The Xbox One is the closest console to a computer so far, both software and hardware. Microsoft is actually already starting to tell businesses that the Xbox One is a worthy purchase.

Microsoft Deems The Xbox One An 'Entirely Justifiable' Business Expense - Forbes

 

[a5cent]

^ Interesting. I wonder if we'll ever see statistics on that.

 

[Robert Carpenter]

^ Interesting. I wonder if we'll ever see statistics on that.

No idea, but the use cases will be pretty compelling.

"Microsoft Xbox MVP Marques Lyons lists features packaged with the Xbox like Kinect-enabled Skype video conferencing, SkyDrive cloud storage, Wi-Fi direct for beaming tablet presentations to a TV, and general apps like Internet Explorer and Office Web."

They pretty much just stated that their web apps for office will work on IE for Xbox One. What other web apps will work on it? Skype and Skydrive is a huge bonus too. Will we see strictly business oriented apps in the Xbox One app store? Who knows.

 

[Simon Tupper]

^ Interesting. I wonder if we'll ever see statistics on that.

I hope so. Xbox making its debuts in IT would be an interesting win for Microsoft.

 

[spaulagain]

Sorry, I should have clarified better.

A functional org works when all your products are targeted towards the same people, it promotes collaboration and that single-vision concept people mention here.

huuuhhh? Since when is it best to isolate yourself into a single market demographic? There are a million reasons why its a good business practice to actually adhere to different market audiences. Number one being that your business isn't solely dependent on one group. And another is that various groups within the company can actually learn or take ideas that work for one market group and apply them to another.

It is important to be unified, in that at least a group of employees have an overall perspective of the entire product portfolio and its target audiences. Its also important that the company encourage cross department collaboration even if they are for different market groups.

MS has been pretty much completely siloed over the past decade. In addition to that, their focus on the business audience has left them blind to the consumer needs. And remember, every member of a business is also a consumer. They recognize that, and are changing as a result.