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Nadella’s Job One

 

Microsoft has a new CEO – a safe choice, steeped in the old culture, with the Old Guard still on the Board of Directors. This might prevent Nadella from making one tough choice, one vital break with the past.

Once upon a distant time, the new CFO of a colorful personal computer company walks into his first executive staff meeting and proudly shares his thoughts:

“I’ve taken the past few weeks to study the business, and I’d now like to present my top thirty-five priorities…”

This isn’t a fairy tale, I was in the room. I didn’t speak Californian as fluently as I do now, so rather than encourage the fellow with mellifluous platitudes — ‘Interesting’ or, even better, ‘Fascinating, great vision!’ — I spoke my mind, possibly much too clearly:

“This is terrible, disorganized thinking. Claiming to have thirty-five priorities is, in fact, a damning admission: You have none, you don’t even know where to start. Give us your ONE priority and show us how everything else serves that goal…”

The CFO, a sharp, competent businessman, didn’t lose his cool and, after an awkward silence, stepped through his list. Afterwards, with calm poise, he graciously accepted my apologies for having been so abrupt…

Still, you can’t have a litany of priorities.

Turning to Microsoft, will the company’s new CEO, Satya Nadella, focus the company on a true priority, one and only one goal, one absolutely must-win battle? For Nadella, what is Microsoft’s Nothing Else Matters If We Fail?

In his first public pronouncement, the new Eagle of Redmond didn’t do himself any favors by uttering bombastic (and false) platitudes (which were broadly retweeted and ridiculed):

“We are the only ones who can harness the power of software and deliver it through devices and services that truly empower every individual and every organization. We are the only company with history and continued focus in building platforms and ecosystems that create broad opportunity.”

One hesitates. Either Nadella knows this is BS but thinks we’re stupid enough to buy into such pablum. Or he actually believes it and is therefore dangerous for his shareholders and coworkers. Let’s hope it’s the former, that Nadella, steeped in Microsoft’s culture, is simply hewing to his predecessor’s chest-pounding manner. (But let’s also keep in mind the ominous dictum: Culture Eats Strategy For Breakfast.)

Satya_Nadella

Assuming Nadella knows the difference between what he must say and what he must do, what will his true priority be? What battle will he pick that, if lost, will condemn Microsoft to a slow, albeit comfortable, slide into the tribe of has beens?

It can’t be simply tending the crops. Enterprise software, Windows and Office licenses might not grow as fast as they used to, but they’re not immediately threatened. The Online Services Division has problems but they can be dealt with later — it continues to bleed money but the losses are tolerable (about $1B according to the Annual Report). The Xbox One needs no immediate attention.

What really threatens Microsoft’s future is the ebullient, sui generis world of mobile devices, services, and applications. Here, Microsoft’s culture, its habits of the heart and mind, has led the company to a costly mistake.

Microsoft has succeeded, in the past, by straddling the old and the new: The company is masterful at introducing new features without breaking older software. In Microsoft’s unspoken, subconscious culture, the new can only be defined as an extension of the existing, so when it finally decided they it needed a tablet (another one after the Tablet PC failure), the Redmond company set out to build a better device that would also function as a laptop. The best of both worlds.

We know what happened. Users shunned Microsoft’s neither-nor Windows 8 and Surface hybrids. HP has backed away from Windows 8 and now touts its PCs running Windows 7 “Back By Popular Demand”  — this would never have happened when Microsoft lorded over its licensees. And now we hear that the upcoming Windows 8.1 update will boot directly into the conventional Windows 7-like desktop as opposed to the unloved Modern (née Metro) tiles.

Microsoft faces a choice. It can replace the smashed bumper on its truck with a stronger one, drop a new engine into the bay and take another run at the tablet wall. Or it can change direction. The former — continuing to attempt to bridge the gap between tablets and laptops  — will do further damage to the company’s credibility, not to mention its books. The latter requires a radical but simple change: Make an honest tablet using a version of Windows Phone that’s optimized for the things that tablets do well. Leave laptops out of it.

That is a priority, a single, easily stated goal that can be understood by everyone — employees and shareholders, bloggers and customers. To paraphrase a Valley wag, it’s a cri de guerre that’s so simple you can remember it even if you’re tired, drunk, and your spouse has thrown you out in the rain at 3 A.M. in your jockey briefs.

This is an opportunity for the new CEO to make his mark, to show vision, as opposed to mere care-taking.

But will he seize it?

Nadella should know the company by now. He’s been with Microsoft for over twenty years, during which time he’s proven himself to be a supremely technical executive. The company is remarkably prosperous — $78B in revenue in 2013; $22B profit; $77B in cash. This prosperity bought the Board some time when deciding on a new CEO, and should give Nadella a cushion if he decides to redirect the company.

Of course, there’s the Old Guard to contend with. Bill Gates has ceded the Chairman role to John Thompson, but he’ll stay on as a “technical advisor” to Nadella, and Ballmer hasn’t budged — he remains on the Board (for the time being). This might not leave a lot of room for bold moves, for undoing the status quo and for potentially embarrassing (or angering) Board members.
I can’t leave the topic without asking another related question.

We’ve just seen how decisive Larry Page can be. He looked at Motorola’s $2B red ink since they were acquired by Google — no end in sight, no product momentum — and sold the embarrassment to Lenovo. If regulators approve the sale, Motorola will be in competent hands within a company whose leader, Yang Yuanqing also known as YY, plays for the number one position. (Lenovo is the company that, in 2005, bought IBM’s ailing PC business and has since vaulted over Dell and HP to become the world’s premier PC maker.)

With this in mind, looking at the smartphone space where Apple runs its own premium ecosystem game, where Samsung takes no prisoners, where Huawei keeps rising, and where Lenovo will soon weigh in — to say nothing of the many OEMs that make feature phone replacements based on Android’s open source software stack (AOSP) — is it simply too late for Microsoft? Even if he has the will to make it a priority, can Nadella make Windows Phone a player?

If not, will he be as decisive as Larry Page?

JLG@mondaynote.com
@gassee

Why Twitter needs a design reset

 

Twitter is the archetype of a greatly successful service that complacently iterates itself without much regard for changes in its uses. Such behavior makes the service — and others like it — vulnerable to disruptive newcomers. 

Twitter might be the smartest new media of the decade, but its user interface sucks. None of its heavy users is ready to admit it for simple reason: Twitter is fantastic in broadcast mode, but terrible in consumption mode. Herein lies the distortion: most Twitter promoters broadcast tweets as much as they read them. The logical consequence is a broad complacency: Twitter is great, because its most intensive broadcasters say so. The ones who rarely tweet but use the service as a permanent and tailored news feed are simply ignored. They suffer in silence — and they are up for grabs by the inevitable disrupter.

Twitter’s integration can’t be easier. Your Tweet it from any content, from your desktop with an app accessible in the toolbar, or from your smartphone. Twitter guarantees instant execution followed by immediate gratification: right after the last keystroke, your tweet is up for a global propagation.

But when it comes to managing your timeline, it’s a different story. Unless you spend most of  your time on Tweeter, you miss many interesting items. Organizing feeds is a cumbersome process. Like everybody else, I tried many Twitter’s desktop or mobile apps. None of them really worked for me. Even TweetDeck seems to have been designed by an IBM coder from the former Soviet régime. I looked around my professional environment and was stunned by the number of people who acknowledge going back to the basic Tweeter app after unsuccessful tries elsewhere.

Many things are wrong in the Twitter’s user interface and it’s time to admit it. In the  real world, where my 4G connection too often falls back to a sluggish EDGE network, watching a Tweeter feed in a mobile setting becomes a nightmare. It happens to me every single day.

Here is a short list of nice-to-have features:

Background Auto-refresh. Why do I have to perform a manual refresh in my Twitter app each time I’m going to my smartphone (even though the app is running in the background)? My email client does it, so do many apps that push contents to my device. Alternatively, I’d be happy with refresh preset intervals and not having to struggle to catch up with stuff I might have missed…
Speaking of refreshes, I would love to see iOS and Android coming up with a super-basic refresh system: as long as my apps are open in the background, I would have a single “Update Now” button telling all my relevant apps (Email reader, RSS reader, Twitter, Google Current, Zite, Flipboard, etc.) to quickly upload the stuff I’m used to read while I still have a decent signal.

Save the Tweet feature. Again, when I ride the subway (in Paris, London or NYC), I get a poor connection – at best. Then, why not offer a function such as a gentle swipe of my thumb to put aside a tweet that contains an interesting link for later viewing?

Recommendation engine. Usually, I will follow someone I spot within the subscriptions of someone I already follow and appreciate. Or from a retweet. Twitter knows exactly what my center of interests are. Therefore it would be perfectly able to match my “semantic footprint” to others’.

Tag system. Again, Twitter maintains a precise map of many of its users, or at least of those categorized as “influencers”. When I subscribe to someone who already has thousands of followers, why not tie this user to metadata vectors that will categorize my feeds? Overtime, I would built a formidable cluster of feeds catering to my obsessions…

I’m puzzled by Twitter’s apparent inability to understand the needs of the basic users. The company is far from unique in this regard.; instead, it keeps relying on a self-centered elite of trendy aficionados to maintain the comfy illusion of universal approval – until someone comes up with a radical new approach.

This is the “NASA/SpaceX syndrome”. For decades, NASA kept sending people and crafts to space in the same fashion: A huge administrative machine, coordinating thousands of contractors. As Jason Pontin wrote in his landmark piece of the MIT’s Technology Review:

In all, NASA spent $24 billion, or about $180 billion in today’s dollars, on Apollo; at its peak in the mid-1960s, the agency enjoyed more than 4 percent of the federal budget. The program employed around 400,000 people and demanded the collaboration of about 20,000 companies, universities, and government agencies. 

Just to update Pontin’s statement, the International Space Station cost $100bn to build over a ten years period and needs about $3bn per year to operate.

That was until a major disrupter, namely Elon Musk came up with a different way to build a rocket. His company, Space X, has a long way to go but it is already able to send objects (and soon people) to the ISS at a fraction of Nasa’s cost. (Read the excellent story The Shared Genius of Elon Musk and Steve Jobs by Chris Anderson in Fortune.)

In the case of the space exploration, Elon Musk-the-outsider, along with its “System-level design thinking powered by extraordinary conviction” (as Anderson puts it), simply broke Nasa’a iteration cycle with a completely different approach.

That’s how tech company become vulnerable: they keep iterating their product instead of inducing disruption within their own ranks. It’s the case for Twitter, Microsoft, Facebook.

There is one obvious exception – and a debatable one. Apple appears to be the only one able to nurture disruption in its midst. One reason is the obsessive compartmentalization of development projects wrapped in paranoid secrecy. Apple creates an internal cordon sanitaire  that protects new products from outside influences – even within the company itself. People there work on products without kibitzing, derivative, “more for less” market research.

Google operates differently as it encourages disruption with its notorious 20% of work time that can be used by engineers to work on new-new things (only Google’s dominant caste is entitled to such contribution). It also segregated GoogleX, its “moonshots” division.

To conclude, let me mention one tiny example of a general-user approach that collides with convention. It involves the unsexy world of calendars on smartphones. At first sight not a fertile field of outstanding innovation. Then came PeekCalendar, a remarkably simple way to manage your schedule (video here) on an iPhone.

Peek-Photo3

This app was developed by Squaremountains.com, a startup created by an IDEO alumni, and connected to Estonian company Velvet. PeekCalendar is gently dismissed by techno-pundits as only suitable for not-so-busy people. I tested it and – with a few bugs – it nicely accommodates my schedule  of 25-30 appointments a week.

Showing this app during design sessions with my team at work also made me feel that the media sphere is by no mean immune to the criticism I detailed above. Our industry is too shy when it comes to design innovations. Most often, for fear of losing our precious readership, we carefully iterate instead of seeking disruption. Inevitably, a young company with nothing to lose nor preserve will come up with something new and eat our lunch. Maybe it’s time to Think Different™.

frederic.filloux@mondaynote.com
@filloux