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The lost decade – on how people really don’t understand Microsoft


Vanity Fair started this enormously stupid phenomenon called Microsoft’s lost decade. I have been in the Microsoft ecosystem for quite a long time, not as a Softie but as a partner for over 15+ years. I usually blog in Finnish in our corporate blog but this whole “lost decade” thing pushed me to start an English blog as well. A big thanx to Neowin, it was your great post “What the hell is Microsoft’s lost decade?” that made me write a blog post of my own on the subject.

During “the lost decade” I have founded two companies, both 100% focused on Microsoft technologies. The previous one was founded in late 2001 and is nowadays one the best known Microsoft partners here in Finland. Our current startup Sulava employs around 20 people and is growing rapidly. We are already one of the most recognized Finnish cloud partners. My companies have delivered hundreds of solutions to blue chip clients in Finland and to their subsidiaries around the world. We have always utilized the newest Microsoft technologies, most of which has been published and developed during the lost decade. And I can tell you our clients love the technology.

Unparalleled achievements

I’d like to give you a short look on some of the Microsoft’s achievements during the lost decade. SharePoint was launched back in 2001, so most of it’s life cycle has been during the lost decade. SharePoint alone has sold 125+ million licenses – that’s unbelievable. Windows 7 alone has sold 630+ million licenses. Office 2010 has sold 200+ million licenses. The list just goes on and on. These numbers are clearly unparalleled by any other competing products or companies. Xbox is nowadays the most popular gaming device and Kinect is one of the fastest selling consumer devices ever. Bing’s search market share (US) in June 2012 was 15,4% (28,8% when combined with Yahoo). That’s not a lot but Bing is the only search engine that can compete with the Google in the US. And that’s actually huge when you think it this way – the 3rd player (Ask) has marketshare of 3% or so. I could continue this list for quite a long time, but I think everyone should get the point by now.

As for innovation.. Just check out the unbelievable things happening at Microsoft Research or read Steve Clayton’s stories on Next at Microsoft. This should give you a hint on what’s happening at Microsoft. And one more thing. During this lost decade I have had a pleasure to work with Microsoft in tens of charity projects. Microsoft’s impact on non-profits is amazing, and in 2011 it’s employees spent 400,000+ hours on volunteer work and raised over $100 million to charities. Who could call this lost work?

A huge transformation

Microsoft has gone through a huge, and I mean absolutely huge, transformation to the cloud in the past 6 years or so. Now almost every single Microsoft product is available or is going to be available in the cloud. Microsoft has introduced a whole new Azure platform, which is an astonishing Cloud OS when combined with Windows Server 2012 and other Microsoft tools like System Center 2012. Office 365 is likely to replace SharePoint as a Microsoft’s fastest selling product. And again the list just goes on and one. Everything in the cloud has happened during the lost decade. And the transformation has shaken Microsoft business, including licensing and revenue model, to the core. Yet the company has hit a record revenue & profit countless times. Most of the modern companies would have lost at least half of their cash and market cap if they were to go through a transformation this big. Actually I think most of the IT companies would have been buried for if they have tried to do something similar as Microsoft has already gone through during this lost decade.

Microsoft has the widest offering in the technology space. It should be clear to everyone that there are, and always will be, companies that are more advanced and quicker to respond than Microsoft in some small segments. But when you think for example business productivity or the life of an ordinary consumer as whole no other company comes even close.

Stack rankings

That’s enough for the business / tech side for now. Vanity Fair’s Eichenwald lists Microsoft’s so called “stack rankings” as “the most destructive process inside of Microsoft” and he stresses that every Microsoft employee he knows thinks so. What a crap. I know personally hundreds of current Microsoft employees, many of them being personal friends as well. Most of them don’t love the obsessive scorecards, which of course are the base of the stack rankings. But almost everyone understands that the scorecards need to be there, otherwise it would be impossible to lead a company as big as Microsoft (94,000+ employees plus an absolutely huge number of vendors in 100+ countries). I really, and I mean really, don’t see destructive internal competition inside Microsoft. If anything I see people bored with too detailed scorecards, but that seems to be the trends almost everywhere nowadays. I simply don’t get where Vanity Fair pulled up their scoop on stack rankings being the most evil invention ever.

A story + a bit on Surface

And then to the story on the e-reader / tablet innovation. I have heard quite another story. According to version I heard a couple of Softies like Bill Gates and Craig Mundie had a vision of an iPad like tablet something like 10 years ago. It would have been completely touch controlled – not by a stylus as a replacement for the mouse. But what happened to this vision? Obviously Bill Gates didn’t thumb down his own vision. According to what I heard the product groups, and especially the marketing, didn’t see the difference between touch based device and current Windows. So finally they decided to go on with a stylus controlled tablet PC and later on stylus based Windows Mobile instead of a new touch based UI. That was not the way to do it of course. Microsoft was on a wrong track for quite a long time but now it’s finally going to the right direction with Windows 8, Windows Phone 8, Xbox + Kinect, Office 2013 and various other products. And btw, I have been using Office 2013 for a while in my tablet with touch – believe me, it does work.

I’ll end this rant with one more example on how far too many people underestimate and don’t understand Microsoft. At the moment Microsoft is going to sell the Surface only though it’s own stores – and there are only around 30 of them or so. People keep saying that Microsoft has made a huge mistake. Limiting the sales to the Microsoft stores has been a very well thought decision. Microsoft already has one of the largest retail chains in the world. Don’t believe me? Check out your local stores… There are quite many places and ways to buy for example a Xbox, Microsoft keyboard / mouse or a copy of Office. Microsoft could have easily and effectively utilized the same retail chain for the Surface had they decided to do so.

Disclaimer: And oh yes, one could call me a Microsoft fan boy. And I do earn my living from the Microsoft ecosystem and I love to work with Microsoft products and people. But that doesn’t change the facts, does it?

4 Comments Post a comment
  1. Good article Aki

    July 31, 2012
  2. Someone #

    Stack ranking has nothing to do with scorecards. Having scorecard is one thing. Having a team where everyone exceeds their goals but only 1-2 get bonuses while 1-2 get screwed because of stack ranking is the problem. That is stack ranking. Not the scorecards.

    About the cloud: it may be good for Microsoft but no one so far has convinced me that it’s in the best interests of the customers or individuals who have to give up their information to the cloud. If cloud was really cheaper for customers and made Microsoft less money than on-premise installations they wouldn’t be doing it. This leads to the result that since Microsoft is all-in they plan to make more money on it than the existing on-premise model. This means that for the CUSTOMER the on-premises model could be better if they can do it right.

    Microsoft does many things well but they are not perfect. There are plenty of things that are screwed in any company with the size of Microsoft and unless they learn from their mistakes and the criticism they will suffer from it.

    I think this post just proves your fan boy status. It doesn’t do any good for Microsoft nor you.

    August 29, 2012
    • Marcel Valdez #

      Agree with this. Completely. This guy doesn’t even understand what stack ranking is. Scorecards? WTF is the author talking about. Did he even read glassdoor reviews? People hate that shit, even star performers getting good reviews.

      November 20, 2012

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