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Software // Operating Systems
Commentary
8/26/2013
09:06 AM
Mike Feibus
Mike Feibus
Commentary
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Ballmer Is Off The Matrix

Microsoft's outgoing CEO couldn't see the desktop for the tiles.

It should come as no surprise that Steve Ballmer is out as Microsoft CEO. The company's vision for client computing is miserably off base, and that's on him. How could he have blessed such a misguided strategy for client devices?

On Ballmer's watch, Microsoft rolled out Windows 8, a product that is destined to go down as one of the most colossal missteps in computing history. I wouldn't be surprised to see it morph one day into a verb for undermining your own product. Like, for example, "the way they eight their core product like that, it's no wonder they went belly up."

Any first-year b-school student would tell you that Microsoft disregarded the basic tenets of business expansion with Windows 8. If you want to grow your business, you've got two logical options: Extend the reach of your existing products into new markets, or develop new products for your existing customers.

There's a simple two-by-two matrix to guide such decisions. You can make one for yourself by drawing a cross inside a square so that there are four quadrants. Label the two columns "new customers" and "existing customers" and the two rows "new products" and "existing products." Expand your business from the "existing products/existing customers" square to either extend current or develop new products. The square at the far end of the two-by-two matrix – "new products/new customers" – is better left for the start-ups.

[ Microsoft's mobile group can't pause for a new CEO. See Microsoft's Big Risk As Ballmer Departs: Windows Phone. ]

Maybe Keanu Reeves' character Neo might see how Windows 8 fits into the matrix. But here in this dimension, there's no option for taking an existing product with a large stable of existing customers -- the cushiest square on the board -- and essentially upending it by transforming it into a new product.

A common ploy in the software world is to get existing customers to pony up again for existing products by making and selling new-and-improved versions. That's what Microsoft had done through Windows 7. And it's what the industry expected the company to do with Windows 8.

This is a whole lot easier to grasp if we set aside the Windows numbering scheme for a moment. The existing product is the Desktop, and the new product is the Start Page. Shortly after the iPad came out in 2010, whispers were circulating that Microsoft was developing touch for Windows 8. Many industry participants were excited. They took that to mean that the software giant would be adding touch capability to the desktop.

They expected the company to update the menu structure so that it was more finger-friendly. And they expected to see gesture equivalents for mouse and keyboard commands. And they hoped to see some APIs so that hardware vendors and app developers could run with it.

No such luck, though. Instead of upgrading the desktop, Microsoft spent most of its efforts on the Modern UI and relegated our beloved desktop environment to a tile on the Start page.

So why did Ballmer embrace such an ill-fated direction? It's certainly possible that the Windows 8 nomenclature fogged his vision, and he just assumed that we'd all automatically upgrade from Windows 7.

More likely, he got caught up in the one Microsoft vision. It must have been intoxicating to think of a wide swath of products, all with a universal UI and programming model. But it shouldn't have been so intoxicating that he couldn't see that it was a really bad idea to upend the PC -- the market where Microsoft actually has a presence -- so that it would play nice with products in markets in which Microsoft barely registers.

Maybe if Ballmer directed the company to approach the problem from the other side of the fence -- force Windows phones and tablets to adapt to the PC desktop -- everyone might be better off, huh?

As it happens, it's too late for Ballmer. Sadly, he was so close to the product that he couldn't see the desktop for the tiles.

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DDURBIN1
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DDURBIN1,
User Rank: Apprentice
9/3/2013 | 5:26:06 PM
re: Ballmer Is Off The Matrix
P.T. Barnum comes to mind. Marketing leader yes, CEO of a tech company no.
DDURBIN1
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DDURBIN1,
User Rank: Apprentice
9/3/2013 | 5:23:47 PM
re: Ballmer Is Off The Matrix
You can also add reduced R&D as a percentage of revenue under Ballmer verses Gates which follows right along with short term thinking.
Michael Endler
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Michael Endler,
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8/27/2013 | 9:10:54 PM
re: Ballmer Is Off The Matrix
Thanks for following up. I'm glad it's worked out for him. I agree to an extent; for most truly superlative talents, a "cream rises" ranking system can work.

I'm still skeptical of stacked ranking, though. A term like "bottom dwellers" sounds like a generalization to me, especially since some groups at Microsoft are comprised almost entirely of people with PhDs. Not that people with advanced degrees can't be lousy workers-- but if nine people score perfectly on a test and you miss only one question, would it be fair to fire you as the "bottom" performer? Seems like some of this stuff should be considered in relative terms, rather than measured by an absolutely scale. Also, managers - even at great companies like Microsoft - don't always invest in the right performance metrics, or the right way of measuring them. I wonder if many perceived "bottom feeders" have been driven out by stack ranking, only to prove after moving somewhere else that they have much to contribute.
WKash
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WKash,
User Rank: Author
8/27/2013 | 8:59:50 PM
re: Ballmer Is Off The Matrix
Sadly for Microsoft, while Windows 8 did try to bring needed uniformity to the desktop/laptop, tablet, smartphone continuum, it was hopelessly too late, and all the more doomed, given Microsoft's failure in the mobile market. The marketplace had already made iOS or Android the platforms of choice. But perhaps another factor cementing Windows8's fate is the degree to which corporate and government IT shops are also recasting their operations into the cloud, and looking at the savings potential of adopting alternative licensing options. One imagines had Windows7, with all of its improvement, been released in today's environment, it would still have faced a disintegrating marketplace.
Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
8/26/2013 | 11:01:16 PM
re: Ballmer Is Off The Matrix
Perhaps in 1999 Gates didn't think the company needed a visionary. So he tapped a numbers guy to hold steady and keep the company above the fray. Problem is the numbers guy stayed for 13 years.
Thomas Claburn
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Thomas Claburn,
User Rank: Author
8/26/2013 | 7:49:41 PM
re: Ballmer Is Off The Matrix
Ballmer deserves credit for generating returns for investors, but Microsoft's present situation suggests that a focus on short-term shareholder value can be detrimental in the long-run. Jeff Bezo's insistence on reinvesting revenue at the expense of immediate returns offers an alternative management path.
Michael Endler
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Michael Endler,
User Rank: Author
8/26/2013 | 6:43:54 PM
re: Ballmer Is Off The Matrix
Different conversation, I think. Your anecdotal experience merely suggests that for some people, Windows 8 is a good product. That's different than talking about the product's success overall.

Mike Feibus's point isn't about one person's experience, or even one company's experience; it's about the aggregate attitude toward Win8, as measured by data. By almost every standard to which the public has access, Windows 8 has been a poor performer, even if you adjust for circumstances (e.g. Windows 7 had the advantage of following Windows Vista, whereas Windows 8 had the misfortune of following the wildly popular Windows 7). If you throw in the Surface write-down, lost marketing dollars, and all the rest, Windows 8 has been an objective failure. If Windows 8.1 doesn't turn around the OS's trajectory in a major way, "colossal misstep" won't be an unwarranted label.

That's not to say Windows 8.1 won't make necessary adjustments, or that Win 8 doesn't meet some people's needs, even in its current form. I think you can also argue that some people who think Windows 8 is garbage could actually benefit from it, if they'd only learn how to use it.

But a lot of informed people don't like the OS, sales have been dreadful, and usage share among those who have adopted the OS is pretty poor. That Windows 8 has failed isn't a matter of opinion. It also isn't necessarily a dismissal of the OS's merits. Rather, that Windows 8 has failed is simply a statement of the facts.
RobPreston
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RobPreston,
User Rank: Author
8/26/2013 | 6:30:17 PM
re: Ballmer Is Off The Matrix
Not every omni-competent CEO has the chops to arbitrate technical issues. Cisco's John Chambers comes to mind. We need to give Ballmer some credit for doing more than milk the cash cows. For one (big) thing, he has rallied employees and partners around cloud computing, much like Gates did (around the Internet more broadly) more than a decade ago. It's still early days in the cloud, but Ballmer has laid the groundwork at Microsoft. Ballmer certainly has made some big mistakes; so did Bill Gates in his day. All big companies, especially in technology, need a change of leadership after a certain period of time to keep things fresh. But don't underestimate Ballmer as a first-class marketer, as an energizing, thoughtful leader, and someone who knew his weaknesses and hired/promoted people to compensate for them. And, from all that I could see, he's a good man. Lots of companies should be so lucky.
Michael Endler
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Michael Endler,
User Rank: Author
8/26/2013 | 6:26:30 PM
re: Ballmer Is Off The Matrix
Was your wife's cousin's husband measured with stack ranking? If people feel treated well under that sort of managerial system, I'm genuinely curious to hear more about why they like it. It's a fairly maligned aspect of the Ballmer culture.
Michael Endler
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Michael Endler,
User Rank: Author
8/26/2013 | 6:24:13 PM
re: Ballmer Is Off The Matrix
I think that's fair. In the handful of interviews he's given since making the announcement, he's conceded that he didn't always give due attention to products that he "didn't get." Tablets fall squarely in that category, in a variety of ways. Ballmer deserves credit for growing Microsoft's server business, and the next CEO will appreciate some of the groundwork Ballmer laid with Office 365, Windows Azure and a few other pieces. But the next CEO will also probably wish that Ballmer had laid some of this groundwork a few years earlier. Ballmer is clearly a smart guy, but this was the wrong job at the wrong time, as his continual missteps over the years attest.
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