Thursday, November 30, 2006

The Innovator Microsoft

BusinessWeek, in their annual list of the world's 25 Most Innovative Companies for 2006, ranks Microsoft at number 5. Microsoft ranked superior in Product and Business Model Innovations with Windows and Office, and Windows Live Services.

Microsoft today released the much awaited Windows Vista, Office 2007 and Exchange 2007 for businesses. CEO Steve Ballmer claims this to be the "biggest launch we've ever done."

Importantly, Ballmer believes that Vista will spur a new 'Wave of Innovation". Ballmer claims that a "new set of applications are also being brought to market and enabled by the core innovations in Office 2007 and Vista. Some 30 new products will come to market over time on the back of this wave of innovation."
What are these new Innovations from Microsoft?

The new Windows Vista, Office 2007, Exchange 2007, SharePoint Server 2007, Exchange Server 2007, Enterprise versions of both Vista and Office 2007 with new capabilities such as enterprise services for Exchange and SharePoint, Unified Messaging Services for Exchange, Exchange Hosted Services, Forefront Security for Exchange, Forefront Security for SharePoint.

What's coming down the Innovation road?

Office Communicator 2007, Office Communications Server 2007, Voice Call Management for Office Communications Server 2007, Office Performance Point Sever 2007, data mining add-ins for Office 2007, the Windows Desktop Optimization Pack, Forefront Client Security, System Center Configuration Manager and client, and System Center Operations Manager and client.

Asked on what else Microsoft could put into the next version of Windows, Ballmer said there are a "lot of things we never got to with Vista that we will work on going forward. There are improvements to be made in networking infrastructure, we need to take advantage of the shift to multicore processors, and there is a lot more to do for IT administrators to make systems simpler and cheaper to deploy."

Microsoft is also planning on service enablement inside of Windows. "That is a big theme and you can expect to see a lot more services enablement going forward," Ballmer said

Four Core Pillars of the Business Market

Ballmer talks about the four core pillars that make Microsoft's People Ready business fulfill today's business needs:

The first pillar is helping simplify how people work together, with unified communications a dominant theme in that regard, and which encompasses VOIP (voice over IP)—technology that will ship next year—e-mail, IM and video.

The second pillar is finding information and improving business insight, which includes finding information, searching documents, e-mail and people; integrating systems through XML and Web services; analyzing information through visualizations; and reporting and empowering decisions through business intelligence, portals and search.

The third pillar is helping people protect and manage their content, including retention and rights management; drive encryption and backup; and electronic forms.

The fourth pillar is about reducing IT costs and improving security.

Ballmer also emphasizes that staying in sync with information is another core need, encompassing Wikis, blogs and RSS, with collaboration and workflow very important in allowing people to connect and share easily. Working remotely with mobile PCs is another big area.

At the launch event, Diane Prescott, a technical product manager for Microsoft, demonstrated how data can be accessed through Outlook. Outlook Voice Access allows users to dial in and manipulate their e-mail and calendar, and it can also dynamically detect when a foreign language has been used, she said. Outlook Web Access has also been changed and now allows users to wipe clean a device they may have lost or that has been stolen to protect company data, she said.

"Vista is the first product developed under the SDL (Security Development Lifecycle), making it more secure. Deployment also has to be simplified, and a single image helps in this regard. Security risks also have to be mitigated, support costs reduced and identity and access controlled...," Ballmer said.

Innovation and Creativity talks abound

In a Q & A between Ballmer and eWeek Senior Editor Peter Galli, Ballmer made many references to Innovation and Creativity as strategic to Microsoft:

In answer to Galli's question on how you make the Windows development process more agile, especially when it took five years in the making, Ballmer talks about:
"It's that first period where we had the greatest learning. We are going to incubate, or incubate and innovate, instead of trying to do all this integrated innovation."

In response to the incubation of new technologies, rather than just having integrated innovation, going forward, Ballmer says:
"Let me give you an example: WPF, Windows Presentation Foundation, we have it in the marketplace, but the Windows shell doesn't use it yet. And that's OK.

If we tried to hold Windows until the shell could rewrite, then we're back on very long cycle times.

It's a good example of incubate or incubate and innovate than opposed to innovating and integrating all in one big bang."

Ballmer also talks about innovation in the context of when Microsoft will cross the line and what new technology goes on which track:
"I mean, it is not like we are not going to do any integrated innovation, it's just that we are thoughtful and we have to learn from experience where we are crossing the line beyond the state-of-the-art innovations coming together."

While talking about Windows-enabling service and how Microsoft will be one of the biggest service providers through Windows Live, Ballmer suggests:
"So that platform, the end-user platform, the developer platform, for rich-client code, be it on PCs or phones—which are getting smarter, not dumber, that's important innovation that needs to be supported by service and enable service and we're working hard on all aspects of that issue."

Finally, Ballmer provides this gem in response to "How does becoming far more of a services provider play out with your partners and those traditional service providers?”
"Every innovation is both an opportunity and a threat for anybody in our industry, be it a partner or competitor."

And Ballmer goes on to state: "Well, in the grand scheme of things, partners have done fine, and the move to software as a service should again be an enabler of new and different kinds of creativity."

Bottomline

Microsoft recently launched the media player Zune in response to iPod’s market leading innovation. It has received a tepid market response. I even argued that Zune has the potential of being a disruptor in the long term.

Is Microsoft launching a new wave of innovation with Windows Vista, Office 2007 and Exchange 2007 and some 30 new products? Or are these merely nice-to-have product enhancements that users were asking for, and were just delayed for the past few years? Who is going to benefit the most from this new wave? The Small Business or the Enterprise or the Developer? The productivity worker or IT? And how difficult will it be for IT to upgrade and for users to take advantage of these new innovations? The major new features, four core pillars, and all the talks about Innovation and Creativity can make your head spin as you try to sort out how this will fundamentally impact you, the person, in Microsoft's grand scheme of People Ready business. And one can argue that Microsoft has not yet service-enabled Windows, not taken advantage of multi-processor architecture, still has some work cut out in network infrastructure, and need to win over IT in general. And the biggest question is still left unanswered: What is Microsoft's innovation strategy vis-a-vis Google and the new Web?

Selected references:
Leading eBook on Creativity and Innovation in Business
Creativity and Innovation Best Practices
Creativity and Innovation Case Studies
The Innovation Index
Top 50 innovative companies in the world

References:

BusinessWeek

eWeek: Ballmer: Vista to Spur 'Wave of Innovation'

eWeek: Ballmer: Biggest Launch Ever

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