Microsoft-case Study

 Entrepreneurial days

 Steward type management : – Efforts and Strategies for sustaining the lead in market.

Bill Gates

Harvard University

Computer terminal of Seattle School

Paul Allen

University of Washington

Language Program: BASIC

1974, PC ( A l t a i r ) was developed by Allan’s Interest using Intel’s in Intel’s 8080 Microprocessor technology.

Allan consulted Gates to develop a language program for the computer.

Allen developed Simulator and assembler

Language for ALTAIR

LUCK

Gates wrote Codes

Gave demonstration successfully to Robert (ALTAIR designer)

With success in 1st stage, they FORESAW the coming future

MICRO from

SOFT from

Microprocessor

Software

Microsoft

Software for Micro-processors.

Vison • Gates DECIDED to develop BASIC • No company w as using 8086, • Gates Vision al low to lead the marke ed him t.

Bill Gates

Intel p re 8086 sented chip 1978 , in

1980, IBM contacted ‘MS’ to develop ‘Project chess’

• MS started looking for new OS. • Paul Allen contacted ‘Seattle Computer Products’ for ‘QDOS’ & negotiated an agreement for use of OS in whatever way MS wants

ital IBM to Dig • MS send as they didn’t Research, gy olo had techn rtunity d the oppo te c je • DR re

Deal allowed Microsoft to offer OS to IBM & license BASIC, FORTRAN and eventually COLBOL to IBM Knowledge

+

IBM name

Complimentary assets

Open Architecture

Launch of IBM PC

and

Decision came back to haunt IBM in future

Microsoft contract With IBM Open Architecture.

•  Allowed so ft developers to ware develop numerous applications.

2 Years IBM decided to use 8088 technology

Microsoft was again assigned for development

Personnel stress was faced due to technical problems, cultural differences

IBM PC was launched in Aug 12, 1981

MS DOS & CP/M were fighting for right to become leader in market

MS DOS dominated the market

Gates convinced many software developers to design software for MS DOS

‘Gates’ knew that applications represents actual value to users,

the broader the number of application better the operating system’s chance of survival

S M n o i l l i m 30 , 0 8 9 1 f o By the end ammed PC’s were in r g o r p S O D market IBM acquired LOTUS in 19 order to ensu 95 in re the develo pment of application s for its OS/2

OS/2 technology was developed by IBM in an attempt to recapture leadership in PC industry OS/2 was IBM Proprietary technology but proved to be late attempt to compete

Apple’s system was graphically displayed and was much easier for non-experts

1980

•  DOS was standard OS •  Wasn’t user friendly

DOS was text based and monochrome

1981

•  Development of GUI •  GUI should neither effect DOS nor application designed for it

1983

Gates announced that graphical interface would be operational by the end of 1984

Announcement of GUI came after a close competitor ,VISI Crop, announced its own windows environment.

Turned out to be strategic announcement for customers to wait for Microsoft product

Technical information release was delayed.

Fortunate Gates

Many other companies were trying to establish their systems

None was successful.

l a i r u e n e r p Entre

Stewar manag d ement type st yle

Entrepreneurial Faced ch industr allenges of y stage o at different f matur ity Instabi

lity

Freque nt M progra ove of mmers

Steward type… (1984…)

Launc Window h of s1.05 i n 1985 Divisio n OS and in-charge of a were d pplications evelop ed Deploy m respon ent of sibility.

Window 95 was even considered as primitive version of Macintosh. Apple was unable to capitalize on its superior GUI technology

Application base was low for Windows 1.03

1989, Application for Windows flooded in market

launch of Windows 95 was once again delayed, and again LUCKILY no other competitor came with better technology 1990, Windows 3. was launched I million copies were sold that year

1990

32 bit technology included in Intel’s Pentium microprocessor Windows 95 was launched

1995

Despite of critics MS office share in market was 90%

1996

With Microsoft included software to access Microsoft network, Competition was with online service provider like AOL, CompuServe…

Introduced Windows NT to compete with UNIX

Pushing software companies to develop compatibility between Windows 95,98 or NT

Because of compatibility problem there was low demand of Windows NT

 Microsoft strategy in 1994 focused around 5 main areas: 1.  Consumer Software 2.  Advanced Technology 3.  On-line Services 4.  Network Computing 5.  Office Equipments







 Internet plateform & tools division  Desktop & Business System  Software strategy  Consumer system  On-line services  Office Business Unit  Long term Research  Strategic Relations

1.  Finding smart people 2.  Organizing team of overlapping functional specialist 3.  Pioneer & Orchestrate evolving mass market 4.  Focusing creativity 5.  Do everything in parallel 6.  Improve with continuous feedback & sharing. 7.  Attack the future

Strengths

•  Windows 95, 98, 2000 series, and Windows NT are globally known with a market share of about 88% •  World's largest software company with global recognition and strong reputation for innovative products •  Software products have high name recognition, broad-based corporate and consumer acceptance (Word, Excel, PowerPoint, Access).

Weakness

•  Dependency on hardware manufacturers to preinstall Microsoft's PC operating system •  Little or no significant presence in the wireless market •  Falling sales in the operating systems and server software sectors

Opportunities

•  Cheaper global telecommunication costs open new markets as people connect to the Internet •  The demand for personal computers in American and global markets remains strong despite the growth and increasing popularity of personal handheld devices.

Threats

•  Apple and Linux threaten Microsoft's 88% market share of the desktop operating market •  Rapid development of mobile devices that will displace/replace personal computers •  Recession or economic slowdown in the U.S. or global market impacts personal computer equipment sales and their need for an operating systems •  Technology life cycle is shorter and shorter

 In MOT, Timing is critical.

 In 1970’s IBM was huge in technology market & only focused on main frame computers not PC’S.

 Microsoft saw the future prospects & targeted PC market.

 Microsoft grabbed opportunity in its deal with IBM.

 IBM followed open architecture for launching PC in late 1980’s & eventually lost its dominant market share.

 Microsoft kept the right to license its OS & started selling it to various organization providing IBM clones.

 Even huge companies like IBM can benefit from alliances with small companies

 Its important to exploit the technology.

 Incremental innovation is also important to be managed.

 Entrepreneurial personality, vision, ability to forecast the future of technology and other mgt. skills are important for success of the firm.

 Develop technology keeping future prospects in mind.

 Calculated risk taken.

 Major factors were technical and business ability.

 Luck was a significant factor.