08-26-2013 12:23 PM
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  1. a5cent's Avatar
    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.
    Last edited by a5cent; 07-15-2013 at 10:36 PM. Reason: First scentence
    07-15-2013 05:49 PM
  2. awkm's Avatar
    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.
    Laura Knotek and squire777 like this.
    07-15-2013 11:52 PM
  3. willysocks2222's Avatar
    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.
    07-16-2013 01:47 AM
  4. ag1986's Avatar
    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.
    07-16-2013 04:59 AM
  5. a5cent's Avatar
    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.
    Last edited by a5cent; 07-16-2013 at 09:11 PM. Reason: Spelling
    07-16-2013 09:20 AM
  6. Robert Carpenter's Avatar
    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 likes this.
    07-16-2013 11:27 AM
  7. a5cent's Avatar
    ^ Interesting. I wonder if we'll ever see statistics on that.
    07-16-2013 11:38 AM
  8. Robert Carpenter's Avatar
    ^ 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.
    07-16-2013 11:45 AM
  9. Simon Tupper's Avatar
    ^ 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.
    07-16-2013 12:22 PM
  10. spaulagain's Avatar
    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.
    07-16-2013 05:35 PM
  11. Simon Tupper's Avatar
    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.
    And Apple's products are not only for the consumers.
    Last edited by Simon Tupper; 07-16-2013 at 07:32 PM.
    07-16-2013 07:08 PM
  12. a5cent's Avatar
    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.
    You misunderstood him. He's not saying a company should focus solely on a single market. He's saying that companies that are organised along functional lines work best when they are focused on a single market. Apple is one such example, as they are organised functionally and focus solely on consumers.

    And Apple's products are not only for the consumers.
    No, but Apple doesn't cater directly to the needs of the enterprise. I've yet to see a large corporate IT department looking forward to supporting more iProducts. Apple makes their sales pitch to the consumer, most of whom also serve in some professional role, which is how those products enter corporations, particularly those that support BYOD policies.
    Last edited by a5cent; 07-16-2013 at 08:21 PM. Reason: Last paragraph
    07-16-2013 08:10 PM
  13. Simon Tupper's Avatar
    You misunderstood him. He's not saying a company should focus solely on a single market. He's saying that companies that are organised along functional lines work best when they are focused on a single market. Apple is one such example, as they are organised functionally and focus solely on consumers.



    No, but Apple doesn't cater directly to the needs of the enterprise. I've yet to see a large corporate IT department looking forward to supporting more iProducts. Apple makes their sales pitch to the consumer, most of whom also serve in some professional role, which is how those products enter corporations, particularly those that support BYOD policies.
    North Korea uses pretty much only Macs because Apple refuses systematically to provide any data to the government. The same can be said about a lot of foreign companies who doesn't want the US to stick their nose in their business.
    07-16-2013 09:01 PM
  14. Cleavitt76's Avatar
    North Korea uses pretty much only Macs because Apple refuses systematically to provide any data to the government. The same can be said about a lot of foreign companies who doesn't want the US to stick their nose in their business.
    Really? North Korea? That government is infamous for it's irrational behavior.

    Apple's position on releasing data to the US government is no different than MS, Google, or any other company bound by US laws. North Korea for all intents and purposes isn't even connected to the internet so the technology they use is hardly relevant. If North Korea uses Apple Macs it's probably because Kim Jong Ill thought that iStuff is cool. He also wore brown jumpsuits with aviator glasses and pretended that he was a Hollywood movie director (that dude was hilarious). Other than their Nuclear program, which they flaunt for all the world to see, their only "secrets" are the things they are hiding from their own citizens (hence the lack of internet).

    Meanwhile, every other company and government in the entire rest of the world is using Microsoft, Linux, Unix, Cisco, IBM, Lenovo, HP, VMware, and Oracle. Almost zero Apple or Google products are being used for enterprise or infrastructure level technology.
    a5cent likes this.
    07-16-2013 09:58 PM
  15. NTUser's Avatar
    North Korea uses pretty much only Macs because Apple refuses systematically to provide any data to the government. The same can be said about a lot of foreign companies who doesn't want the US to stick their nose in their business.
    Actually, the DPRK uses its own flavor of Linux. But whatever.

    I think that MS is trying to be innovative, and I applaud them for their courage. They've made plenty of progress, but they do seem to be stumbling a bit. All-in-ones are becoming much more popular now thanks to Windows 8, and tablets are becoming more powerful and business-oriented. I do wish that the start menu was still around, but overall I think they're making a change for the better.
    07-16-2013 10:31 PM
  16. Simon Tupper's Avatar
    Really? North Korea? That government is infamous for it's irrational behavior.

    Apple's position on releasing data to the US government is no different than MS, Google, or any other company bound by US laws. North Korea for all intents and purposes isn't even connected to the internet so the technology they use is hardly relevant. If North Korea uses Apple Macs it's probably because Kim Jong Ill thought that iStuff is cool. He also wore brown jumpsuits with aviator glasses and pretended that he was a Hollywood movie director (that dude was hilarious). Other than their Nuclear program, which they flaunt for all the world to see, their only "secrets" are the things they are hiding from their own citizens (hence the lack of internet).

    Meanwhile, every other company and government in the entire rest of the world is using Microsoft, Linux, Unix, Cisco, IBM, Lenovo, HP, VMware, and Oracle. Almost zero Apple or Google products are being used for enterprise or infrastructure level technology.
    Having their own internet that isn't connected to the internet most of the world uses doesnt mean they don't have internet.

    "Internet access is available in the Democratic People's Republic of Korea (North Korea), but only permitted with special authorisation and primarily used for government purposes. The country has some broadband infrastructure, including optical fibre links between major institutions producing nationwide speeds of up to 2.5Gbit/s.[1] However, online services for most individuals and institutions are provided through a free domestic-only network known as Kwangmyong, with access to the global Internet limited to a much smaller group". - Wikipedia

    "primarily used for government purposes"
    07-16-2013 10:41 PM
  17. Cleavitt76's Avatar
    Which is why I said "for all intents and purposes." Their exposure to the internet is extremely limited. You make it sound like they are storing their data in iCloud because SkyDrive can't be trusted. They aren't using either one. For them, its just a highly restricted portal to the rest of the world, but only a handful of people get access in an unrestricted way.

    Anyway, my point was that your example of the North Korean Government as "Apple in the Enterprise" is not very persuasive.
    07-16-2013 11:03 PM
  18. Simon Tupper's Avatar
    Anyway, my point was that your example of the North Korean Government as "Apple in the Enterprise" is not very persuasive.
    Well any government works a little bit like an Enterprise... it offers services for which you give money. It has several employees all working for the good of the government. It was just an example that came to my mind, it wasn't supposed to be THE ARGUMENT of the day.
    07-16-2013 11:35 PM
  19. nube_android's Avatar
    I disagree! Ballmer is a great CEO. I cannot stand those who say he is an *****, monkey, horrible CEO, etc. Microsoft is doing just fine, stock is doing excellent. Sure, they are lagging behind currently in mobile. But if there's one thing people should not do to Microsoft, is underestimate them. Microsoft will keep pounding on the mobile market until they are a big player, you can count on it. And BTW, the Zune was an excellent device line, just needed to be 2-3 years earlier and a bit cheaper. Microsoft will pull their "one Microsoft" strategy together, and it will not be your dad's Microsoft. Get ready for a new Microsoft that will shake up the market like never before. It just takes time.
    07-17-2013 12:32 AM
  20. Laura Knotek's Avatar
    A lot of Microsoft's problems weren't necessarily being too late but being too early with innovations (and then failing to get those innovations perfected). Bill Gates actually alluded to this in his Microsoft Research Faculty Summit keynote speech on Monday, July 15, 2013. He joked about Bob, which was a failure back in the day. However, the idea of a "personal agent" made a comeback with Apple's Siri; and Siri will be using Bing in iOS7.

    So, the plan that Ballmer put into place to reorganize Microsoft to allow better collaboration between divisions/product lines makes a lot of sense. It should help with the execution that had been lacking in getting innovative ideas to materialize into useful products.

    It sounds like Bill Gates approves of Ballmer's plan, and I wouldn't be surprised if Ballmer consulted with Gates prior to implementing the plan.
    FinancialP, cckgz4, a5cent and 1 others like this.
    07-17-2013 01:24 AM
  21. cckgz4's Avatar
    Too slow to innovate? Depends on your perspective.

    Blackberry took about 6 years to revamp their look

    Apple has been doing incremental updates since the release of the iPhone 4

    Android's stable version (and most dramatic change) has been with Ice Cream Sandwich

    With all of those things being said, Microsoft is creating a unified experience in gaming, music, computers, and cell phone. They are trying to give an Apple experience, and while it does need work, this is what consumers want. With this brand new look, why not let it flourish for a minute before introducing something brand new for consumers to learn?

    And would you call the Kinect innovative? I would
    07-17-2013 04:46 AM
  22. ag1986's Avatar
    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.
    \
    In the case of MS, their business pretty much is dependent on one group - enterprise.

    I haven't taken the time to go through their earnings reports, but I'd bet money that almost all (80% or more) comes from selling Windows, Office and their other corporate products (Exchange, Sharepoint, IIS etc). What businesses want from their IT is not what the consumer wants.
    07-17-2013 05:44 AM
  23. ag1986's Avatar
    North Korea uses pretty much only Macs because Apple refuses systematically to provide any data to the government. The same can be said about a lot of foreign companies who doesn't want the US to stick their nose in their business.
    Source? I have never seen such a statement ANYWHERE.
    07-17-2013 05:48 AM
  24. Cleavitt76's Avatar
    Well any government works a little bit like an Enterprise... it offers services for which you give money. It has several employees all working for the good of the government. It was just an example that came to my mind, it wasn't supposed to be THE ARGUMENT of the day.
    The only reason I challenged the North Korea argument is because I think some of the previous posters had some good points about the involvement that MS has in the enterprise. MS is huge in both the consumer and the enterprise markets, but many of their competitors only compete in one or the other. Apple and Google for example really don't have a presence in the enterprise. This is important for two reasons...

    1) MS may at times move more slowly because many of their products have features related to enterprise customers. Windows and office are both really good examples of this. Unlike OSX which is really a consumer only OS, Windows is used on most business desktops as well as by most consumers with a home PC. Windows Server is also a repackaged version of desktop Windows and must be developed in coordination. MS Office is used by home users, but it is also integrated very tightly with Exchange server, SharePoint, SQL Server, and lots of other business/enterprise products. All of this requires additional coordination, development, and testing, but the benefits (both to Microsoft's profits and to their customers) are often overlooked by people doing a direct comparison to competitors that only operate in the consumer market.

    2) MS also doesn't get credit for a lot of it's accomplishments because about half of their innovation and focus is only noticed by those that are involved in the enterprise market in some way. The Windows NT kernel was developed as the basis of a server OS and later became the kernel used by desktop Windows, Windows Phone, and soon XBOX One. Many other MS enterprise products are not suitable for direct use by the consumer world, but those products are still innovative and many of those products help to indirectly drive things that are used in the consumer world. Microsoft's development tools (Visual Studio, .Net) come to mind.

    When you consider those two things I think MS is actually more quickly innovating that any of it's competitors. As a matter of fact, I can't think of any other time when MS has been moving so quickly. In a span of about 1 year (starting last fall and ending this fall), MS will have released major updates to every one of their products that I can think of. Both consumer and enterprise. This includes products that traditionally have only been updated every 2 to 5 years if not longer. Off the top of my head all of these products are either new or have seen major updates in the past year...

    SQL Server 2012 (major update)
    Windows Server 2012 (major update)
    Hyper-V (major update)
    System Center 2012 (no personal experience)
    Windows 8 (major update)
    IE10 (including new touch optimized version)
    Windows Phone 8 (major update)
    Office 2013 (including new touch optimized version)
    Hotmail -> Outlook.com
    Windows Azure
    Windows RT
    Surface
    Surface Pro

    And in the next few months...

    Xbox One
    Windows 8.1
    IE11

    Wow. I really didn't even realize myself just how much MS has done recently until I started typing that list. Compare this (incomplete) list to Apple's and Google's list of recent accomplishments. They look like they are standing still compared to MS. MS may not be where they want to be in every market (mobile mainly), but as a whole it's hard to argue they are innovating too slowly. If anything I think they might be innovating too quickly for consumers and especially the enterprise to keep up.
    HeyCori, a5cent and Mach_E like this.
    07-17-2013 01:57 PM
  25. Cleavitt76's Avatar
    In the case of MS, their business pretty much is dependent on one group - enterprise.

    I haven't taken the time to go through their earnings reports, but I'd bet money that almost all (80% or more) comes from selling Windows, Office and their other corporate products (Exchange, Sharepoint, IIS etc). What businesses want from their IT is not what the consumer wants.
    I agree that MS is more dependent (or is it more diversified?) on the enterprise market. However, it may be to hard to quantify exactly how much. Your examples of Windows and Office are exactly what I mean. Both are sold as enterprise and consumer products and both are very successful (the most popular options) in those markets.
    07-17-2013 02:09 PM
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