Former Microsoft Executive, Dick Brass

There’s been an interesting dust-up in the press recently, having to do with innovation at Microsoft.

An ex-Microsoft employee, Dick Brass, wrote an op-ed piece in the New  York Times, basically saying that Microsoft is failing to innovate.  He says that in spite of good intentions, great employees, and beaucoup resources they don’t have a formal system for innovation. Brass tries to be kind, you sense in his words that he actually cares a great deal. He concedes that Microsoft it still dominant and a big money maker, but he’s pointing out that unless they find a way to innovate faster they are ultimately doomed. The evidence he presents is virtually indisputable (in my view). Brass was leader of the team that developed Clear Type. He’s a true insider. While he was kind in tone, the truth he expresses, the story he tells, has got to be painful for executives at Microsoft to hear.  Actually, you hope it would be painful to hear.

I agree with the assessment Brass makes. I wondered if Microsoft would be bothered to respond in public, and sure enough, they have. It would have been really interesting to hear an admission of error. Or, that the Brass piece gave them pause for serious thought. It would have been a good signal that they aren’t in denial about their innovation process.

Frank X. Shaw, a corporate VP in communications at Microsoft responded with an easy-going rebuttal. I’ll give him style points, it’s a well written piece. He takes issue not so much with Brass’s facts, but with how they are interpreted, and he puts a positive spin on things. His big point is that Microsoft is good at the “scale” of innovation. And he says that this is the better yardstick by which to measure innovation success or failure. To be expected I guess, but I’d say he’s missing the bigger point.  Yes, scale is important, it is indeed an important measure.  And yes, Microsoft, when they connect, does scale extremely well. And, let’s be fair, Microsoft has done some pretty amazing things over the years.  It’s not that they aren’t innovative at all…

The bigger point is that the pace of innovation matters.  Shaw says blithely at the end of his piece “There is always the opportunity to do more, to move faster, to bring products and services to the world in new and interesting ways, and we embrace this.” The key phrase to notice is “move faster.”  Brass is saying, and I agree, they don’t really embrace the speed element. Why? Because they don’t think they have to. At the end of the day, Shaw is paying lip service to faster paced innovation. And that’s a shame for Microsoft.

Microsoft has had the luxury of market dominance in a key technology so long that they’ve gotten lazy. Maybe not even lazy, maybe it’s just that the bureaucrats have taken over. It matters a great deal to deliver new technology to the market First.  The value of first-in-market positioning is Marketing 101. Microsoft started by doing just that, and that’s why they own the operating system market for personal computers. However, Microsoft is rarely first, or even a fast-following second to the market with a significant new technology or product any longer. Shaw talks about how Clear Type is actually a good example of how well Microsoft innovation works, saying “For the record, ClearType now ships with every copy of Windows we make, and is installed on around a billion PCs around the world. This is a great example of innovation with impact: innovation at scale.”

Yes, Mr. Shaw, scale does matter. And it is lovely that billions of PC’s around the world now have Clear Type. But what about technologies that aren’t able to piggyback on Microsoft’s existing platforms and products?  The delay and corporate political goofiness that the Clear Type team had to contend with is exactly why Microsoft doesn’t have a competitive music player, and why it’s only a contender, and not the leader, in the games market.

Microsoft will continue to do well for a few years, perhaps longer.  But eventually they will pay the price for not having created a a more receptive and formal culture of innovation. It’s not too late…