Foley on Microsoft

How to Fix Microsoft in Five (Not So) Easy Steps

Mary Jo offers her tips on rectifying Microsoft's troubles.

• By Mary Jo Foley
• 07/01/2006

It's summer and the living is supposed to be easy. Easy, that is, unless you're Microsoft CEO Steve Ballmer. Ballmer just can't seem to appease Microsoft shareholders, customers and watchdogs, and no wonder. The company has lurched from one PR mess to the next. Whether it's the embarrassment of Vista delays, the warnings about skyrocketing costs, or the market gains of competitors like Google and Apple, it seems Microsoft can't buy a break. Some are even predicting that Ballmer could soon move on (voluntarily or not) from his CEO post if Microsoft's stock doesn't shape up.

With Microsoft picking up bad press like lint in a laundry room, Ballmer and company might welcome a little real-world advice. Let's cut to the chase and look at my five favorite ideas to fix what's broken at Microsoft:

1. Stop pitting internal teams against each other. Government regulators, worried about collusion among internal Microsoft divisions, needn't bother. From what I've seen, there's very little cross-division collaboration. In fact, Microsoft seems determined to reinvent the wheel -- repeatedly. Witness the disparate calendar functionality cooked into Vista, Outlook/Exchange and Windows Live Mail. Or ponder the three distinct IM clients -- Office Communicator; Windows Messenger and now Windows Live Messenger.

2. Face the hate. Microsoft tech evangelist and blogger Robert Scoble (who recently left the company), in a late April missive, wondered what it would take to satisfy the author of the sharply critical Mini-Microsoft blog. One poster urged Microsoft to build trust among two diametrically opposed groups: Disenfranchised Microsoft customers, and technology customers rooted in the ABM (Anything But Microsoft) camp. Microsoft could win hearts and minds by fostering genuine transparency -- such as launching real blogs on real topics by real people. It could also hire folks with strong connections to open source and other communities beyond the Redmond gates. Linux expert Bill Hilf and IronPython creator Jim Hugunin come to mind.

3. Quit "playing not to lose." That's the advice Windows Live Program Manager Mike Torres has for his company's MSN/Windows Live strategies. Microsoft needs to stick its neck out and get a lot more proactive. Instead, it seems content to react to challenges from Google, Yahoo and purveyors of the latest Web 2.0 solutions.

4. Lighten up on litigation. Microsoft's lawyers have been working overtime to settle the many lawsuits to which Microsoft is party. But just like death and taxes, lawsuits are an unavoidable part of Microsoft's future. Entire companies bank on scoring a big payoff from Redmond. Still, fear of lawsuits is no reason to horde cash -- the company's track record in litigation is strong and it has enough lawyers to extend appeals until many opponents simply disappear. Why not unlock those funds to boost shareholder dividends or, better yet, step up innovation?

5. Get smart with clients. Some users crave power-hungry, thick-client apps on their desktops, and then there's everyone else. Microsoft got smart and developed an Ajax toolkit and refreshed the rotting Internet Explorer code. Now it must extend this thinking. Stop trying to make every feature "part of the operating system." The smart/Web client genie is out of the bottle and all the wishful thinking in the world won't put it back.

If you were to come up with your own "Top Five Fix-Its for Microsoft," what would be on your short list? Write to me at [email protected].