42 – Strange Week of Change for Microsoft

Mark my words – this week will be remembered as the moment of change for Microsoft. And 42 is again the answer.

Throughout the last five weeks, Microsoft have been on a wave of great announcements with Microsoft Dynamics CRM 2011, Windows Phone 7 and the launch of new initiatives. But Microsoft also suffered a loss when president of Microsoft  Business Division – Stephen Elop moved to Nokia.

Coincidence or planned? Is Microsoft rattling the crate to stir up new roles and transition the company management?

All though the weeks have been exciting, this week of 42 2010 have been a tipping point for Microsoft. The week started as Ray Ozzie, CTO for Microsoft, announced his retirement from the company he made a change for. Microsoft lost a great asset i Ray, and the solutions invented under his management will set the stage for Microsoft the next 10 year. Starting low – Microsoft made its comeback with the announcement of Office 365. Finally a clear indication of “all in”. And what a statement. I believe it is the right model, I believe it is the only model for Microsoft. Unfortunately I do not believe in the execution of the model, as too many partners of Microsoft are trying to cope, and find their balance in the act. It is hard times with margins targeting zero – and customers declining professional services.

The IT market is undergoing a dramatic change and, this week have marked the transformation of Microsoft. Personally I do believe that the change in management is planned. I do believe that Microsoft is seeking new innovative and smart people to continue the path of cloud computing. For the thousands of partners this means new faces, new models and new business development.

But it also mean hard time for cash and collect, and I do believe that partners should recap their business model, and start changing. I follow many independent software vendors every day – and yet these companies have the best opportunity and model to fit for cloud computing, they still act as yesterday.

Ray Ozzie, Stephen Elop and Office 365 are marks of change. Consider your change today!

Microsoft is “leading with online” – should you?

This year, at Microsoft’s World-Wide Partner Conference in Washington (WPC), used any moment to tell its partners that they now are leading with online. But what does this mean? And why the sudden change towards online? Should you adopt the same strategy – and why should you?

First of all – Microsoft have done some big mistakes before. Focus on their Internet Explorer product, made them loose half a century to play catch-up with Netscape. Windows Phone is another great example on a loosing strategy for Microsoft. Half a decade lost here too. So is Microsoft misleading the ecosystem? I doubt not – I believe Microsoft already lost 2-3 years of great momentum – they just got better to spot their strategy mistakes. Reality is that Microsoft’s Hosting partners have been preaching the Software + Services business model for nearly 12 years now. Since Microsoft Exchange 2000 – and a bit before – Software + Services has been a part of Microsoft, but now – truly now – customers are in fact telling Microsoft they don’t want to:

• Update any application anymore. Dealing with updates and redeployments are often 40-60% of time spend in the internal IT departments, and over 40% of the external consultant fees.
• Stay up to date, with latest features and functions.
• Pay for what they consume, and use. Customers want to have an easy opt-in options, and a structured and predicted opt-out.
• Outsourced management of their infrastructure and applications, moving focus for the internal IT department to become internal business advisors in IT usage.

Cloud Paradigm on Technology: Earning while boosting your investment

It a known paradigm for many Independent Software Vendors (ISVs) and cloud computing businesses: get a capital investor to bridge your existing business model with the future of software distribution – or, try to build a new business model, whilst preserving the old revenue streams – becoming a FUSE-CO (future-service-company). It is doable. It is risky. If you pull it off – and you have the right solution, your private beach is already reserved.

If you need the muscle and in loss of time: get that capital investor, your still get a private beach (just a small one).

Microsoft recently held a conference for Microsoft BizSpark participant’s dating their ISV partners with the venture market. A great way to build an eco-system of add-value for being a Microsoft Partner; and a great quick entry for an V.C., to spot groups of ISVs in a little time – with a high investment opportunity. I had the opportunity to speak with some of the participant in BizSpark recently, and it became apparent to me that tomorrows business service companies face a set of challenges that we, as an industry, adopted upon them.