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Put customers before cash cows

Raj Supe. Words Left Unsaid. Now Microsoft was refusing to commit to its future beyond the latest release? It was pivoting to a new model: Windows as a service. Rather than asking consumers to shell out hundreds of dollars every few years for a new version, it would release Windows 10 as a free upgrade for current customers and make regular updates and improvements.

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A cynic might observe that adding a credit card to your product portfolio is the oldest trick in the book for adding a revenue stream. At one point, Microsoft accounted for a mere one percent of mobile market share. The duopoly of Apple and Google had an insurmountable lead in mobile. The move was a disaster. The truth was, no one was asking for a third mobile OS. Instead, Microsoft had to write off billions on the acquisition and is still figuring out its place in the mobile ecosystem.

Reversing its focus to look at problems from the outside in instead of inside-out has led Microsoft into fields that, five years ago, were much harder to imagine them leading in, like cloud computing and AI. They discovered, for example, that as more and more companies relied on expanding sets of data to drive their business, storing the data was becoming an expensive logistical nightmare. This was especially true for the large enterprise customers Microsoft had served for years. Microsoft refocused its efforts on the cloud to better meet this need for their customers, so that even those who wanted to maintain some data on local servers could adopt a hybrid solution.

Most large companies already have the talent to innovate and drive growth. The company invested millions in its research team over the years, yet somehow their findings never made it into the products.

The Rise and Fall of Facebook’s Memory Economy

Microsoft has improved the way it identifies which research to use in which products and how to get even the most distant employees to collaborate. For example, every six months or so, they host a two-to-three day workshop between research and product teams to share their findings and participate in a hackathon. Now the company is renowned for its AI efforts in vision, speech, language, and real-time calculation, from healthcare solutions to CPG inventory management. Even an old signature like Office now subtly employs AI in just about every capability in the suite.

He points out sharply that even when all the economic vectors seem to be leading in a certain direction, unexpected human behavior, usually in the form of political change, can shift everything in a heartbeat.

The Fall Before the Rise | Armstrong Economics

Consider that the Asian Development Bank was located in Manila in the s because, back then, everyone was absolutely sure that the Philippines was the future star of Asia. Rather he looks to help readers navigate this turbulent world with rules that can help them identify which countries might, over 5 to 10 year time horizons, rise, fall, or muddle through. Unfortunately, in most parts of the world, the birth rate is falling. Countries that can come up with ways to welcome immigrants without causing too much political backlash will have a leg up, as will those that figure out ways to employ more older workers and women.

That will be easier in nations that elect political reformers as Argentina recently did rather than populists by this logic, Latin America may be at a turning point since its already passed through the dark life cycle stage of populism that many parts of Europe and even the US are in now.