Nadra reengineering Microsoft: How the market value returns to the first camp (the mindset has changed, no longer is Windows-centric, embracing other platforms, and daring to find a new battleground outside the battlefield)

Source: Internet
Author: User



It is said that the current Silicon Valley in the United States is full of "curry flavor." Others say that Silicon Valley has become the "Valley of India". The reason is that the Indians, represented by Microsoft CEO Satia Nadra and Google CEO Sandar Pichai, have dominated the world's most formidable technology giants in recent years.

Since February 4, 2014 as CEO, Microsoft, under Nadra, has risen from $36.35/share to $105.95/share on July 18, 2018, and the company's market capitalisation climbed to more than $800 billion in the current $300 billion from the end of 2013 at the start of 2014.

Microsoft, which used to be the world's number one company, created a $620.58 billion market record in 1999. But as the era of mobile internet misses, Microsoft's market capitalization has shrunk to below $300 billion. And it is because of the recent four-year scalpel-style internal and external reform, so that the current value of Microsoft Satia Nadra back to the first camp, after Apple, Amazon, Google, is the world's fourth market value of the company.

transformation

A successor who is not favored


Lenovo, a person told the "China Business newspaper" reporter, for individual users, the first contact with Microsoft, most likely a CD-ROM, in China, the CD is mostly pirated, but this part of the revenue for Microsoft is the most marginal; For enterprise users, Microsoft is not only an operating system, Companies become Microsoft's customers will sign an agreement, Microsoft will provide a discount for some of the software in this agreement, such as Windows licensing fees, SQL Server database licensing fees or office fees, so as to stimulate enterprises to use Windows, purchase more micro software and services, For example, early Word, Excel, PowerPoint, and now the Cloud Office suite Office 365, Azure Cloud services, and more.

The person said the change in Microsoft's fortunes was marked by the introduction of Apple's first-generation iphone in 2007, the world's smartphone era. Over the next few years, smartphones have become more important devices than PCs. This makes the PC era of Microsoft, Intel, Hewlett-Packard, Dell, Lenovo and other groups face the transition pressure.

An analyst at IDC told reporters, "Looking back this year, Microsoft and windows in the mobile market last Chance is 2010, that year Apple just launched the iphone 4, a from hardware to software to industrial design are far away from the competitor's products." Android is now maturing after a series of tinkering, with Samsung, Motorola and HTC offering Android phones that sell more than millions of levels. But Microsoft eventually missed the opportunity because Microsoft wanted to replicate the business model of the PC market-Microsoft did the operating system, the handset maker made the hardware, and paid for the licensing fees for every smartphone with a Windows-powered system, but the problem was that Android was no money. ”

As a result, Microsoft's days are actually getting more and more upset. Steve Ballmer, who originally planned to act as Microsoft's CEO to 2017, was abruptly announced by Microsoft on August 23, 2013, and Microsoft did not appoint a new CEO at the same time, announcing that it was looking for the new CEO.

Throughout the fall and winter of 2013, the American media have speculated on who will become Steve Ballmer's successor. The media coverage of that period, including the then Ford CEO Alain Murali, then Qualcomm COO Steve Mollenkov, then Ericsson CEO Mr Vestberg, and so on, has been associated with this position.

There were also internal candidates, including the then Microsoft Director, Symantec CEO John Thompson, then Microsoft Chief Operating Officer Kevin Tena, and then Microsoft Executive Vice president, head of Cloud Computing and Enterprise Division Satia Nadra.

The media likened Microsoft's new CEO to a "hot potato". Bloomberg, for example, published a report at the end of January 2014 titled, "Why don't you want to be CEO of Microsoft?" 》。 Bloomberg believes that compared with Microsoft's market capitalisation of $600 billion in 1999, more than 10 years after Microsoft's market capitalisation is less than half of the original, in the mobile internet era of loss, let Steve Ballmer gradually understand the facts, and finally decided to retire early, looking for new people to dominate the reform of Microsoft, but this is destined to be a difficult task.

"Vanity Fair" at the time of the heavy report "Empire Restart" revealed that Microsoft's board of directors in whether to ask the new CEO with an engineer background, should choose to appoint insiders or outsiders, there are big differences.

Satia Nadra also disclosed in the book "Refresh" that, at the time, Microsoft's internal mainstream opinion was, "only outsiders can get the company back on track." Any rumours of a chief executive would be hard to resonate with. "But after several months of gaming, at a meeting on January 19, 2014, the Microsoft Board finally decided to appoint Satia Nadra as the new CEO. February 4, 2014, Microsoft formally announced this decision.

One of the main reasons Microsoft's board of directors chose Satia Nadra, according to the article "Empire Restart", was that "as insiders, what outsiders can bring is Satia Nadra." As a successor to Steve Ballmer, Satia Nadra is clearly not the one to be favored. "Refresh," the book said, Satia Nadra understand that we are "hopeful, but also have doubts."

The Satia Nadra takeover of Microsoft, at the time, faced a very sinister situation: first, the global PC shipments have peaked and slipped into a downturn-then the quarterly shipments of about 70 million units, the number of smart phone quarterly shipments of more than 350 million units; second, the previous year launched the Windows 8 also suffered a cold reception, while iOS and Android showed a sharp upward trend, and internal surveys revealed that most employees did not think Microsoft was moving in the right direction.

Change

Driving internal Change


In a private communication, a Microsoft Chinese person concluded that Satia Nadra's changes to Microsoft, in-house, are mainly manifested in reshaping the corporate culture, corporate strategy and vision, and benefiting from the external representation of a more open, collaborative image. Satia Nadra's first decision in February 2014 was to lay out a reading assignment that would allow all executives to read Marshall's "non-violent communication", a book on harmonious coexistence and promoting cooperation. For many Microsoft employees, this is the first obvious sign that Satia Nadra will not only reshape Microsoft's business strategy, but also change Microsoft's corporate culture.

Then, as a veteran who had been in the service of Microsoft for 22 years, Bill Gates and Steve Ballmer, the third CEO, how did Satia Nadra develop his own efforts to transform Microsoft? In the "Refresh" book, Satia Nadra said, after the CEO, his most important job is to let Microsoft "regain Soul Spirit", this "soul Spirit" is "technology of the people."

Satia Nadra that from the the 1970s Bill Gates created Microsoft, Microsoft's "Soul Spirit" is to each family, each desk has a computer, which was a self-confident and courageous, inspiring ambitious goals, at that time Microsoft has completed the goal. Therefore, Microsoft needs to set a new goal, to promote a new "technology of the people." "I think that Microsoft should turn to ' move first, cloud first ', no longer a personal computer first, or even a mobile phone first. How to make Microsoft successful in a ' mobile first, cloud first ' world is the common challenge we face. "Satia Nadra said.

What does it mean to be "no longer personal computer first"? means that Microsoft no longer treats windows as the most important business. In fact, until 2012, Steve Ballmer publicly stressed that "there is nothing more important than windows in Microsoft." "Satia Nadra advocated a strategic transformation at that time to face the challenges imaginable."

At the same time, why is "move first, cloud first"? "Microsoft has led the PC Revolution through the development of the most affordable computing devices. But with the free Android operating system, Google found a way to halt windows, and we failed to take a timely response. In 2008, Linux-based Android smartphones began to aggressively seize the market, with more than 1 billion activated devices based on the system in 2014. "While competitors define the mobility of the product, we can define the mobility of the human experience," Satia Nadra said. The two trends of mobility and cloud together form the foundation of our transformation. ”

In Satia Nadra's view, the difference between "mobility of products" and "mobility of experience" is that smartphones are clearly more mobile devices than PCs, but people who can't do more work and live on their smartphones are not "mobility of experience", and this "mobility of experience" is enhanced Exactly what Microsoft is good at, and Microsoft's unique value in the mobile internet era.

It is in this direction of thinking, Microsoft's overall research and development ideas have changed. For example, in the development of Windows Phone at that time, some enterprise customers like the function of cross-screen switching, which allows the phone to replace the PC. For example, to get into the mobile market, start driving Office cross-device application development.

After refreshing the corporate strategy, Satia Nadra also began to refresh the corporate vision based on the first few months of listening and communication. In the full letter of July 10, 2014, Satia Nadra announced that "we must understand and embrace what only Microsoft can bring to the world, Microsoft is the" mobile first, Cloud first "world to provide productivity and platform for the experts, we will reshape the productivity of every organization in the world, every person has achieved extraordinary."

This e-mail means that Microsoft's vision is no longer "to have a personal computer in every family, every desk," and become "a force for every organization and every person in the world."

What is "productivity"? Satia Nadra writes in a full letter that productivity is far more than just documents, spreadsheets, slides, and more people are inundated with mobile devices, apps, data and social networks, and we're committed to helping people in the age of intelligence.

In this e-mail, Satia Nadra provides a target map, the central location text is "digital work and life experience", surrounded by a variety of cloud platforms and computing equipment. "Soon the world will reach 3 billion of people connected to the Internet, sensors, and IoT, and we're going to win billions of of networked devices instead of worrying about shrinking PC markets," he continued. "Satia Nadra said.

In addition, in accordance with their own transformation and business philosophy, Satia Nadra also began to build their own executive team, in the team building process, the inevitable loss of the former executive team members, but Satia Nadra's guiding ideology is, "senior management team needs to be a common worldview and cohesive team." As of March 29, 2018, Satia Nadra has announced through full-fledged mail that Microsoft will end the Windows division, dissolve the Windows Engineers team, lead the Windows business team, and set up the "experience and equipment division", "Cloud and AI platform Division", The two new divisions and the AI and Research department, led by Microsoft's Global executive vice president, confered, comprise Microsoft's three major divisions.

The reason for Microsoft to do this is that, after several years of strategic adjustment, the proportion of Windows business in Microsoft's overall revenue has fallen below 9%, for Microsoft is becoming less important, and Microsoft Smart Cloud service revenue accounted for nearly 30%, almost become with the "computer business" Productivity and business process business "shares the business sector.

It was on this basis that Satia Nadra announced that Microsoft's takeover of Nokia was a failed deal, because "I understand the logic behind expanding market share and building the third reliable ecosystem (Android, Apple), but I really don't understand why the world needs a third mobile ecosystem, Unless we can change the rules of the game, Satia Nadra announced that nearly 18,000 jobs will be cut out of Nokia, but Satia Nadra lets Microsoft mobile business focus more on the Windows Phone development needed by the organization.

In the first few months of his tenure, one of the most important things that Leonard did was to take a lot of time to listen to the voices of all sides, "meet all the executives in the company", and then emphasize "the importance of going out, telling them to visit partners and customers like Me", the key is to listen to the customer's comments and suggestions, but also try to answer two questions, one is why we are here, and the second is what we will do next. "I had a direct conversation with hundreds of employees from different levels of the company and from different departments. There is also a focus group that allows people to share their opinions anonymously. ”

Cooperation

Increased external cooperation


Satia Nadra believes that as Microsoft's new CEO, he must do a few things: clear and regular communication on the mission, worldview, business and innovation vision, and the second is to drive cultural change from top to bottom, let the right team do the right thing, and build a refreshing, unexpected partnership Make cakes together and satisfy customers; four is ready to catch up with the next wave of innovation and platform change, in the "Mobile first, Cloud first" world in search of opportunities, rapid implementation.

The IDC analyst said that in Satia Nadra all the reform measures, changes in corporate strategy and corporate culture and other content is predictable, because Microsoft had to do that, in fact, the most surprising thing is to do a lot of "enemy-friendly" work outside. If Apple is one of Microsoft's most enduring rivals, then Google is the most realistic competitor of Microsoft at the time. But shortly after Satia Nadra as CEO, he decided to fully promote Microsoft's OFFCE products, including the iOS platform and Android platform, and the development of the relevant version was immediately launched.

Satia Nadra said that Microsoft's innovation will revolve around user demand rather than around user devices. Therefore, in March 2014, in the second month of office, the Office suite was announced to be brought into the iOS platform. "Our top priority is to meet the needs of billions of of our customers, no matter what cell phone or platform they choose," Satia Nadra said. Only in this way can we continue to grow. To this end, we will shake hands with our long-time rivals, pursue unexpected partnerships and revive long-term relationships. ”

Microsoft's attitude has also received a positive response from Apple. Apple began inviting Microsoft to optimize Office 365 for Apple's new products. Apple felt that Microsoft had a new openness, so it started trusting Microsoft and wanted Microsoft to take part in Apple's launch.

At the ipad Pro launch, Apple executives suddenly told a live audience, "We're lucky to have some developers who are working with us to improve their professional productivity." Who knows more about productivity than Microsoft? The scene came out with a tense laugh. "Yes, they understand productivity. "Then Microsoft Office Marketing leader took the stage and stated that Microsoft would increase its support for the ipad.

Salesforce is both a Microsoft competitor and a partner. At an annual Salesforce marketing meeting in 2015, Satia Nadra with an iphone, "When I hand out an iphone from my jacket pocket, the audience bursts into loud laughter." Because in recent memory, no one has seen Microsoft CEO publicly display Apple products, especially at a competitor's sales meeting. But I say it's an iphone Pro, because it installs all of Microsoft's software and apps, and then the big screen appears with icons for apps such as Outlook, Skype, Word, Excel, PowerPoint, and bursts of applause on the spot. ”

Under the guidance of Open, co-operation and co-win, Microsoft started working with Apple, and began working with Google to bring Office products to iOS and Android platforms, collaborate with Facebook to connect all Facebook apps to Microsoft's Windows products, and Microsoft's Games app "My World" Also began to Butt-face book Virtual reality device OculusRift, although Oculus Rift and Microsoft HoloLens there is a direct competitive relationship.

Microsoft has also started working with Red Hat to let Red Hat Enterprise customers leverage Microsoft's Azure cloud services to expand their global presence, but Red Hat is a Linux platform that competes with Windows. "When I stand on the stage and a slideshow behind ' Microsoft Loves Linux ', an analyst joked that the sun was coming out of the West," Satia Nadra in the book "Refresh". ”

In the cloud computing market, Microsoft Azure and Amazon AWS are a pair of direct rivals, but there's no way to prevent Microsoft's Bing from becoming a search engine for Amazon Fire tablets. Today, Microsoft has been expanding its partner community, including just signing up with Wal-Mart to promote its own cloud services and artificial intelligence, signing up with companies such as GE, and accelerating access to the industrial Internet sector. It is because of the continuous opening of the soil, Microsoft can return to the world's first camp.

observed

The significance of the elephant's turning


There are too many large enterprises in the world to smoke the case. such as Motorola, Nortel Network, Nokia, and so on, once in the face of the challenge, it may appear bankrupt, be acquired, gradually sink the fate of the end, it is regrettable.

In fact, in the era of PC Internet in the Golden Age of Intel, Microsoft, Hewlett-Packard, Dell, Lenovo and a large number of companies, to the smartphone market-driven mobile internet age, are facing the problem of elephant turn, so far, Hewlett-Packard, Dell, Lenovo and other companies are still in the mire of transformation, standing in the upstream of the industry chain Although the days are not particularly sad, but also unspeakable transformation has been successful, and dare to say goodbye to the past, chose the cloud service new track of Microsoft, re-found the vast world.

Through the Microsoft case can be seen, the elephant turned the first puzzle, first of all isDare not find a new battlefield outside the main battlefield, the second is how to base on their own core competencies in the new battlefield and further gain market advantages, but also to see whether the elephant itself ills the right remedy, in addition to see whether can change their prejudices, and those who did not like the business.

Throughout the successful transformation of large enterprises, such as the blue giant IBM from hardware to software transformation, Huawei from the Tob business to the TOC business transformation, all experienced this process. And those who have not succeeded in the transformation of elephants, such as the Chinese market has been completely into the pipeline of the three major telecom operators, should learn from Microsoft, IBM, Huawei and other companies in the transformation process of the experience and lessons, can finally come out of their own a new world.

NET edit: Rui Wen

Nadra reengineering Microsoft: How the market value returns to the first camp (the mindset has changed, no longer is Windows-centric, embracing other platforms, and daring to find a new battleground outside the battlefield)

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