March 16, 2006 9:59 AM PST

Ballmer plays up business focus

NEW YORK--Microsoft will spend $500 million this year to promote upcoming products designed to make business workers more productive, CEO Steve Ballmer said Thursday.

Software due to arrive over the next year will cater to information workers in corporations, he told an audience at a Microsoft-organized customer event here. The event was specifically targeted at business executives, such as CEOs, rather than IT workers or developers.

Credit: Microsoft
Microsoft CEO Steve
Ballmer speaks to
business customers in
New York.

In the past few years, information workers "haven't had all that much" in terms of product innovations, Ballmer said during a press meeting after the conference and his keynote speech.

Microsoft is expected to release Windows Vista and a suite of Office 2007 products by the end of the year. In addition, the company is getting ready to launch an expanded communication product line around its Exchange e-mail server software.

Ballmer said that Microsoft's sharpened focus on end-users this year goes back to the company's roots of appealing to end-users during the early days of the PC.

"In many ways, we are still feeding off the core vision of (Microsoft founders) Bill Gates and Paul Allen, which is the notion of empowerment," he said.

Ballmer sought to draw a contrast with IBM and its approach to selling to businesses. He said that IBM is increasingly a consulting-led company, rather than a technology company.

"We're talking about making people in business more productive every day. IBM is talking about doing a project," Ballmer said.

He added that Microsoft's forthcoming software puts the company into new product categories, which will help drive revenue growth.

In particular, upcoming editions of its Office productivity suite and server products, such as Microsoft's SharePoint portal software, will enable the company to offer software for tasks such as business intelligence and collaboration.

During a presentation, Chris Capossela, a corporate vice president in Microsoft's business division, demonstrated how future products might improve efficiency in typical business situations, such as searching a company network to prepare a sales presentation and analyzing sales numbers. These tasks were done with Office-based applications, rather than specialized tools.

Gartner analyst Tom Austin said that although IBM does indeed actively seek out consulting business, it is still developing software to make office workers more productive.

Austin said Microsoft does have a stronger focus on individuals and provides a great deal of value through a combination of its products. For business customers, however, the value of well-integrated products comes at the price of greater reliance on Microsoft, he said.

"Nobody locks you in as much in delivering all that value as Microsoft, but nobody delivers as much value," he said.

Other analysts at the event noted that Microsoft faces a challenge in convincing customers to upgrade to new versions of Office, because many customers do not take full advantage of already available features.

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So much of what MS is proposing...
... is already being done in companies with competent management
and employees. Using MS Office, maybe with Access and FileMaker
Pro, a few other focused programs and basic intelligence,
corporations do very well.

Without competent management and employees, nothing MS can
offer will make any significant difference.

It's not the suit that let's Superman fly
Posted by Earl Benser (4310 comments )
Reply Link Flag
May Have Missed the Point
Software can absolutely make a difference on employee productivity. It is one of many tools that professionals use every single day. Depending on how complex, integrated and powerful software is it can have dramatic impact on employee effectiveness and satisfaction with IT.

Said another way, I can give someone an axe or a power saw to clear a forest. Both are great tools and can get the job done. Yet, we understand that there is a productivity difference between the two.

I think this is a great path for MSFT to follow. In fact, I wish more vendors would pick up on this core theme/focus. To the extent that they can invest more $$$ in usability and make their packages simpler yet more powerful, it will provide very, very direct business value.

BTW, I saw the video of this off a link on WSJ. The stuff (Office 2007 I believe) that I saw demonstrated was fairly compelling . It made sense, and is something that most business professionals could actually understand and use. We must remember, business professionals want simplicity in software. Their jobs are to be good at what they do. Software should enable that, not impede it.

Good words MSFT. Now, let's see you deliver. With all due respect to us IT folks, I love the focus on the end user. Make software that much easier for our internal customers to use, and you will make satisfaction with IT higher. You will also make them a lot more productive.

Posted by James_U (80 comments )
Link Flag
Core vision of "empowerment"?
That was not Gate's vision. As usual, he saw others were having
success with it in the micro computer area, so adopted the
terminology but not the reality, as if it were his idea. That
empowerment scared the hell out of IBM, which is why they
brought out a really weak PC, the biggest oversight being an OS
(which Gates luckily provided in the aptly named QDOS 'Quick and
Dirty OS' from Seattle Computer Systems). Windows is still big in
business because it controls the user, which businesses like, which
is the opposite of empowering them.
Posted by Ian Joyner (66 comments )
Reply Link Flag
Microsoft still has the best most secure products
No matter what everybody is going on about
open source. They forget the fact that open source everybody including the most wicked hackers have the code which makes it very very vunerable
Posted by DannyJock (7 comments )
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