Recently, I attended a BayCHI talk on the new direction in UI done by the Office 12 team (more on that in another post).
We had a debate as to why Microsoft would take such risks with Office here and now. I was on the side of, “this is a big risk, they didn’t have to take it… this was smart.” MarkJ and others were on the side of, “Ah, they are a monopoly, and people already bought it… they can do whatever they want”
I think I’m right, of course :-), but the reason is simple. History. Historically, when people have a monopoly or solid position, the incumbent managers do not take risks with their cash cow. In fact there have been many Harvard B school studies and books that document this. The one that comes to mind is “The Innovators Dilemma”.
I think Microsoft changed because they saw the writing on the wall and wanted to put a lot more distance between themselves and everybody else. They could have made incremental changes, again, and still pulled off a release of Office 12. There would have been very little damage to their revenue. They decided to take a huge risk, and I think they will reap many rewards for this.
What do you think?
Well the fact that Innovator’s Dilemma is bible at Microsoft and Intel should invalidate the conclusion that, “History shows that Microsoft as a monopolist will not take risks.”
BTW, the claim of the book is not that these market-leading companies (many of whom are distinctly not monopolists, natural or otherwise) fail because their inability to take risks. Rather it is their inability to see the threat from what the author refers to as “disruptive technologies” which start out as inferior but grow to supplant the technology or system on which the market-leader is built on.
From that perspective, Innovator’s Dilemma (whether you believe it or think it is bullshit) doesn’t take a side on Office 12. The book applies to answering things like why Intel invests heavily in fiber optics, or why Microsoft continues to lose money on the home console and PDA markets.
Why take risks in Office 12? I don’t believe Mark’s statement actually answers the question as to “why.” However, I think more traditional ideas such as monopoly lever might explain their decision better.
Given how Microsoft’s programming teams are organized, there could be many reasons for the risk. Some features could be for monopoly extension (moving Office into other areas), others might simply for maintenance (support of Windows the platform), and some could just be to mitigate/attack Microsoft’s other moves against what they perceive as disruptive technologies (the browser, home entertainment devices, server-client model, embedded devices, etc.).
(I am assuming that there is no real threat to Office itself else some features would be in order to get “review wins” against competing products. Perhaps I’m wrong—perhaps Apple Keynote has worried people at Microsoft into rethinking their outdated UI?)