Is Microsoft The New GM?

Dick Brass issues a harsh wakeup call to Microsoft in this New York Times Op-Ed. Oldsters like me who've spent our lives thinking of Microsoft as The Evil Empire are now vaguely embarrassed to be taunting what now looks like a pitiful, reeling giant. Seemingly beset by more agile rivals on every side, Microsoft continues to lurch through highly profitable years but fails to innovate, keep up, or look even slightly cool. Many of it's flagship products are losing market share and looking threatened.

Brass:

AS they marvel at Apple’s new iPad tablet computer, the technorati seem to be focusing on where this leaves Amazon’s popular e-book business. But the much more important question is why Microsoft, America’s most famous and prosperous technology company, no longer brings us the future, whether it’s tablet computers like the iPad, e-books like Amazon’s Kindle, smartphones like the BlackBerry and iPhone, search engines like Google, digital music systems like iPod and iTunes or popular Web services like Facebook and Twitter.

Some people take joy in Microsoft’s struggles, as the popular view in recent years paints the company as an unrepentant intentional monopolist. Good riddance if it fails. But those of us who worked there know it differently. At worst, you can say it’s a highly repentant, largely accidental monopolist. It employs thousands of the smartest, most capable engineers in the world. More than any other firm, it made using computers both ubiquitous and affordable. Microsoft’s Windows operating system and Office applications suite still utterly rule their markets.

I am skeptical. Exactly when did MS ever innovate? The earlier MS showed a certain talent for adopting and gaining control of new technologies developed elsewhere, but I can't recall a single major MS product that was homegrown. Amazon had a revolutinary idea. Google had a revolutionary product. Apple has both innovatve products and a relentlessly perfectionist esthetic utterly at odds with Microsoft's "everything including the kitchen sink" philosophy.

Brass is right, though, in thinking that it would be bad to revel in Microsoft's troubles. He has his own diagnosis for why an army of the world's best and brightest have largely failed to bring great new products to the market - entrenched corporate politics, as well as some old scores to settle.

What happened? Unlike other companies, Microsoft never developed a true system for innovation. Some of my former colleagues argue that it actually developed a system to thwart innovation. Despite having one of the largest and best corporate laboratories in the world, and the luxury of not one but three chief technology officers, the company routinely manages to frustrate the efforts of its visionary thinkers.

For example, early in my tenure, our group of very clever graphics experts invented a way to display text on screen called ClearType. It worked by using the color dots of liquid crystal displays to make type much more readable on the screen. Although we built it to help sell e-books, it gave Microsoft a huge potential advantage for every device with a screen. But it also annoyed other Microsoft groups that felt threatened by our success.

Engineers in the Windows group falsely claimed it made the display go haywire when certain colors were used. The head of Office products said it was fuzzy and gave him headaches. The vice president for pocket devices was blunter: he’d support ClearType and use it, but only if I transferred the program and the programmers to his control.

Is it a leadership problem? Or inevitable senescence?