1. Patrick J. Riffel
Jacob Babcock
Zach Motsch

3.  Did Microsoft ever come out with something
that will make our computers moist and
chewy like cakes where we could just eat
them while we were working?
 So far, Microsoft hasn’t!
 However, competitors like Google and Apple
have introduced innovative products.

4.  “Microsoft was built on innovation, and our
future depends on it” – Bill Gates
 2009 – Dropped in sales
 First year ever
 May 26th, 2010 – Apple overtakes # 1
 October 4th, 2010 – Stock Downgraded
 Microsoft has become known as
“clumsy, uncompetitive innovator.”

5.  The great tech war of 2012
 Apple, Facebook, Google, Amazon
 Microsoft not included

6.  Why was Microsoft no longer creating the
breakthrough innovative technologies it once
used to pride itself on, and how could they
regain their once dominated # 1 position in
the industry?

7. 
 1975: Microsoft is founded by Bill Gates and
Paul Allen
▪ Sold computer language BASIC to MITS
▪ Micro-soft is an abbreviation of “microcomputer
software”

8.  1977: Bill Gates and Paul Allen move from being
"partners" to Gates as President and Allen as V.P.
 1978: First international sales office – Japan
 1981: Microsoft goes private
▪ Bill Gates - President and Chairman
▪ PaullAllen - Executive Vice President
 1981: The 16-bit IBM personal computer is
launched
▪ Uses the 16-bit "Microsoft Disk Operating System" ("MS-
DOS")

9.  1983: Develops the Windows graphical
operating system
 1983: Develops Microsoft Mouse
 1986: Microsoft Works Launched
 Integrates word processing, spreadsheet, database,
communications, and drawing functions
 Public share increases by $61 million from
$21 per share to $28 per share

10.  1989: IBM and Microsoft make a decade long
agreement to jointly develop a range of
system software offerings
▪ Includes enhancements to MS-DOS, Microsoft
OS/2, and Microsoft LAN that work with Intel processors
▪ Microsoft Office is released
 1990: Microsoft Windows 3.0 is released
 1995: Microsoft 95 is launched
▪ Coupled with the "Microsoft Network" ("MSN"), a collection of internet services
▪ Microsoft and NBC form partnership to create a 24-hours news source on MSN

11.  1997: Microsoft Windows 97 along with Microsoft Internet
Explorer 4.0 is launched
 1998: U.S. Justice Department brings two antitrust cases on
grounds that Microsoft's Web browser's inclusion in Windows
95 forces the browser on PC makers and violates a prior pact
with the Feds

12.  2001: Windows XP is launched internationally
 2001: Xbox gaming system is released
 2002: Partner with Compaq, Acer, Fujitsu, Sony, and
Toshiba to release the Tablet PC
 2003: Announce "Windows Mobile" software for
mobile devices
 2004: Federal court approves the settlement
between Microsoft and the Department of Justice

13.  2007: Launch globally:
▪ Windows Vista
▪ Microsoft Office 2007
▪ Zune, digital and music entertainment device
▪ Microsoft Windows Mobile 6
 2008: Microsoft launches bid to acquire
Yahoo!
 2009: Windows 7 is launched
 2009: Bing search engine is launched
 2010: Microsoft Office 2010 is launched

14.  Corporate Culture
 Manages to frustrate the efforts of best thinkers
 Large groups shut down smaller teams in current
structure
 Near all executives in charge of music, e-
books, phone, search, andtablet left in past
decade.
▪ Interview from one of the departed execs states, “Too
many semi-competent managers, too much in-house
politics”

15.  Research and Development
 Timing of product launch has been poor
▪ Web TV- Early
▪ Mobile, MP3 , Video Games – Late
 Spent 9.5 Billion in 2009

16.  Innovation
 Focused on higher margin, lower risk products
▪ Made financial sense
▪ Fell behind in integration and innovation because of it
 Focused on large scale, rather than speed

18.  Bill Gates wrote a class scheduling
program for his school. He
tweaked the program’s code so
that he was placed in classes with
mostly female students
 Microsoft employees are called
“Softie”
 Average – 38-year old Male making
$106k
 Huge art collection
 Over 5,000 contemporary pieces
 Microsoft campus is full of
bunnies
 Had to catch and have them spayed
and neutered

19.  Widely recognized
 Large market share - Global
 Diversified - OS, Browsers, Search
Engines, Media player, gaming, mobile
 Dominates PC World
 High margin products

20.  Lagging in new creative and innovative
products (Apple)
 New products are more imitations then new
ideas
 Neglected to enter the video game industry
until 2001
 Poor timing to market
 Company culture that frustrates the efforts of
visionary thinkers

21.  Large R&D budget - $9.5B
 Multiple different technology segments to
improve and grow in
 Improve in customer tastes rather then business
needs
 Purchase up and coming companies with
innovative ideas and employees
 Further develop and integrate social media
platform within businesses
 Combine existing business products into a social media platform

22.  Shift in the industry
 PC's to non-PC's
 Phones and appliances
 Cloud computing
 Offering services to customers
 Google Docs
 Competitors
 Apple, Google

23.  Co-founded by Steve Jobs and Steve Wozniak
 Lagged behind Microsoft in the computing
industry in the ’70’s and ‘80’s
 Jobs quite in 1985 due to loosing a
boardroom battle for control of the company
 Apple started its turnaround in 1996
 Jobs vision and $150M from Microsoft

24.  Founded in 1998 by Sergey Brin and Larry
Page
 Internet serach engine
 97% of revenue in 2008 and 2009 was generate
through search advertisement sales
 Expanded its products
 Books, Maps, Apps, News
 Purchases companies –YouTube and DoubleClick
 Mobile - Android

25.  World’s largest provider of computer products
and services
 IT infrastructure services
 Business processes services
 Business solutions requiring advanced computing
power
 Has more patents than any other company in
the world
 Created new innovative products that would
generate revenue
 Innovation Jam in 2006
 150,000 employees and stakeholders

26.  Founded in 1994 by David Filo and Jerry Yang
 Leading online portal before google
 Revenue generated by providing marketing
on most of its websites
 Published its website in 25 different
languages
 Became bureaucratic and slow at innovating
 Brickhouse – 2006
▪ Offsite incubator to create new innovations and ensure
they reached the market as soon as possible

27.  Continue to Invest in R&D
 Focus on Cloud-based technology
 Improve communication between R&D and
marketing departments to better align launch
timing and customer needs

28.  Breed Innovation
 Take more risks to discover either flaws or new
opportunities with ideas
 Maintain diverse social connections
 Create fellowships that promote and award
innovation and new business
 Work with education institutions to launch
entrepreneurial-centered courses and programs

29.  Change work culture
 High monetary rewards for innovation
 A flatter organizational hierarchy that cultivates
ideas and lends a stronger voice to the employees

30.  Improve marketing strategy
 Shift from business focused to a consumer
focused marketing strategy
 Increase marketing focus from product features to
product “ease of use”
 Develop more customer retail locations
▪ Release innovative and risky product that will only be
available in stores

31.  Overview of recommendations
 Discussed ways that Microsoft can improve corporate
culture, breed timely innovation, and improve their marketing
strategy.
 What has happened since 2010?
 Increased profits
▪ 62 Billion (2010) – 69 Billion (2011)
 Skype Acquisition for 8.5 billion
 New marketing campaign emphasizing how products connect
family
 Ranked #1 in social media saviness, ahead of all competitors
▪ This change may have some affect on their culture.

33.  Blum, J. An inside look at cloud-based microsoft office
365http://www.entrepreneur.com/article/220246
 Cohen, Amanda. "Surveying the Microsoft Antitrust Universe." Berkley
Technology Law Journal 19.333 (2004): 333-64. EBSCO. Web. 5 Nov. 2011
 Das, Anupreeta. Microsoft, Others Work on Yahoo
Bid.http://www.online.wsj.com/article/SB100014240529702046187045766413500
08919750.html#ixzz1bIo97NUX
 Manjoo, F. (October 19th, 2011). The great tech war of 2012
http://www.fastcompany.com/magazine/160/tech-wars-2012-amazon-apple-
google-facebook
 Microsoft jerry seinfeld bill gates shoe circus commercial.
http://www.youtube.com/watch?v=rIjNJZpRtj8
 N.A. Apple reports 4th quarter
results.http://www.apple.com/pr/library/2011/10/18Apple-Reports-Fourth-
Quarter-Results.html
 N.A. Microsoft annual report
2010.http://www.microsoft.com/investor/reports/ar10/index.html

34.  N.A. Microsoft officially welcomes
skypehttp://www.microsoft.com/presspass/press/2011/oct11/10-13SkypePR.mspx
 Naraine, R. IT wrestles with microsoft monoculture
myopiahttp://www.eweek.com/c/a/Windows/IT-Wrestles-with-Microsoft-
Monoculture-Myopia/
 O’brien, Kevin. Europe Drops Microsoft Antitrust Case.
http://www.nytimes.com/2009/12/17/business/global/17msft.html?pagewanted=
all
 Productivity future vision
(2011).http://www.youtube.com/user/officevideos#p/u/0/a6cNdhOKwi0
 Rosoff, M. Microsoft's 15 biggest acquisitions (until
today)http://www.businessinsider.com/microsofts-15-biggest-acquisitions-so-
far-2011-5
 Sandbert,, Jared. "Microsoft's Six Fatal Errors." Newsweek 135.25 (2000): 22-
29.EBSCO. Web. 5 Nov. 2011.
 Wilcox, J. Microsoft's clever 'family' marketing campaign is
exceptionalhttp://betanews.com/2011/11/03/microsofts-clever-family-marketing-
campaign-is-exceptional/.