MICROSOFT: IS THE CREATIVE SPARK BURNING OUT

Why Microsoft fails to innovate new products and become a pioneer and market leader?

Microsoft is leading computer operating system maker which is widely used in personal
computers and laptops, however, due to changes in the computer market environment and
dynamics, more users are using a tablet PC and smart phone, Microsoft demand for windows
operating system is declining... Apple and Google is one of the closed competitors of Microsoft,
which both leads in their own version of the operating system, Apple IOS and Google Android is
leading operating system used in smart mobile phones and tablet computers.
For many decades, Microsoft heavily relies on its series of windows operating system for
computers it enters into mobile and gaming industry lately as resulting other market competitors
who were innovated. Microsoft was always blamed to copy ideas from its competitors and does
not have its own idea and also faced many lawsuits as well from its competitors.
The reason behind the Microsoft fails to innovate is it is playing safely and doesn't wish to
position itself outside of operating system business despite the fact Microsoft spend US$9. 5
billion on research and development, but this amount fails to recognize new technologies and
opportunities in existing as well as other markets. Microsoft only entered into other business
division such as in mobile, cloud, and gaming upon pressure from shareholders.
It is also seen that Microsoft is growing its market and product range by inorganic growth
through merger and acquisition, as recent events such as purchase of Nokia smartphones division
and Skype calling company and certain other organization. The sole purpose of acquiring this
organization is to use its technologies, ideas and innovations link it into Microsoft products.
Microsoft is acquiring companies since year 2000. It seems that only innovative idea that was the
base of Microsoft which was laid by Bill Gates, since then there had been no such idea and only
major and minor updates were made as response to change in computing power and
technologies.
By purchasing Nokia smartphone division, Microsoft enters into smart mobile industry however
its windows operating system is not enough innovative to give a tough hand to competitors
operating system such as Android and IOS. Innovation is usually come when Microsoft launches
its own mobile division and learns from its mistakes.
Microsoft office products concept is also copied from IBM and Sun Java, as criticized multiples
time, it is worth to mention here that despite billion of Dollar budget in research and
development, Microsoft seems to copy the concept from its competitor and make its own version
for windows operating system rather than develop an innovation idea in house.
Plan for Special Innovation Division

Currently Microsoft operations are spread out in five division which is the client, Server and
tools, online service business, Microsoft business division, and finally Entertainment and devices
Division.
The possible strategy could to separate each division budget and head which will lead to utmost
innovative idea the team will be rewarded for its effort, as traditionally Microsoft is only relying
on its tradition services. In 2009 client and server and tool account 49% of total revenue. In order
to make Microsoft growth oriented firm it must be innovation at all the like Apple and Google.
A change management concept is required in order to change the way of thinking that prevails in
Microsoft, the failure to innovate new ideas might be on the innovator or employees side as
Microsoft employs world greatest mind so it can be expected that it is on execution side of ideas,
ideas are not executed and dumped, So change management is utmost required in order to
compete in highly competitive environment.
It is fact that innovative ideas are initially are small and experimental, and ongoing operations
are large and established and hence the economy of scale is large. So focus should be diverted
from ongoing operations to new small scale innovative idea which can be launched on the beta
version to whether the new idea will lead the market.
For this Microsoft must change its management style by become leader in every new market of
computing industry in which it operates, yes it is true potentially Microsoft will take risk as
innovator of idea then it will reap benefit until new entrants enter the market Microsoft will
capture significantly market share and will attain economies of scale.
So it is clear the in order to strategy successful following things are required,
 Change Management
 Change in Leadership style
 Separate budgets and leader responsible for each division
 A balance between ongoing operation and new innovative ideas
 Timely implementations of ideas.
 Dedicated Team
 Innovation leaders are identified and rewarded
 Motivation to innovate need to be created
 A thoughtful environment must be provided.
 No need to copy other competitors ideas
 Follow-up plans should be in place
 Continues feedback system should be in place.
These are few things that that are required in order keep Microsoft innovative and market leader
in near future.