How Microsoft fumbled the tablet opportunity and lost focus under Steve Ballmer

August 23, 2013

Ballmer had some major success at Microsoft. His 13 years as Microsoft chief executive saw the firm become the leader in web browsers, enhance the position of the X-Box video games console, and also become a leader in CRM (Dynamics).

He helped make SharePoint and Lync household names in enterprise and tentatively moved Office to the cloud as demand rose for cloud computing. And Azure was strongly positioned as an alternative in cloud services.

And up until 2-3 years ago, Microsoft was firing on all cylinders. But then they lost the focus of what their customers wanted.

Specifically, the disaster in tablets, the failure of Windows RT and the idea Microsoft knew what was best for customers by ramming Windows 8 down their throats universally on all form factors, whether they wanted it or not.

And ultimately, if you lose the focus on what your customers want, you will lose. Customers vote with their checkbooks, and Microsoft was losing badly in the current market. They were hearing the feedback, but they seemed not to be listening.

For all that, Ballmer was a masterful salesman and promoted Microsoft incessantly. He was hugely successful in his first decade.

But lately he had lost touch with his marketplace and the customer base; the infighting and turnover of executives had been dramatic; the company’s lack of vision was destructive (while some may argue that this lack of vision was inherited, you can’t be the leader for more than a decade and claim others’ legacy). His insistence that Microsoft was on the right course even though customers were complaining was catastrophic. 

Microsoft also struggled desperately to grasp the opportunities in tablets and with mobile, under his leadership, with little success.

(Jack Gold will be a featured speaker at the upcoming Tablet Biz conference & expo coming to New York November 13, 2013).

Wrong from the Start with Windows 8

The refusal to add back the Start button on Windows 8 when virtually the entire marketplace was asking for it dramatically decreased the desirably of the operating system and even accelerated the downswing in PC sales.

The near-total failure in mobile devices (with minimal market share) when that’s where the market was going was another disaster. But more importantly than all of that, users and enterprises were focused on the fact that they didn’t believe Microsoft had a long term vision that would lead them into the next decade.

It was clear to most that Microsoft needed a new strategy and new focus. Ballmer had lost his focus. He was telling people what they wanted rather than listening to the market.

So it is clearly a time for new leadership and vision at Microsoft, although Ballmer will be there a while longer yet, which could be a problem in itself.

If he gets to pick a clone of himself as a successor with the same direction and strategy, Microsoft is in big trouble in the long term – they need a new leader, a visionary, who can bring back innovation to the company and who can also provide products people are willing to spend money on.

Unless such a leader is found, Microsoft is in for a continued, albeit slow, decline. Many people still maintain a goodwill feeling towards Microsoft and want it to succeed (and of course enterprises have made huge investments in Microsoft products). 

Can Microsoft tap into this with new leadership and once again become an innovative leader in the market, or at the very least, give people what they want and are willing to put their money down to obtain?

That's the ultimate question the next leader in Redmond will have to answer, and demonstrate a willingness to address.


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