Microsoft elevates Great Plains division

Microsoft has tweaked its chain of command in a move to strengthen a division of the company that makes accounting software and tools for handling other corporate functions.

Doug Burgum, senior vice president of Microsoft's business solutions group, now reports directly to Microsoft Chief Executive Steve Ballmer, the company said Thursday. Previously, Burgum reported to the head of the group that develops Microsoft Office desktop applications.

As part of the reshuffle, Orlando Ayala, the executive who oversees sales of Microsoft's server software and other products for small and midsize businesses, will report to Burgum. Ayala will become chief operating officer of Burgum's unit while maintaining his other roles. Microsoft plans to closely align their divisions, which handle products that are partially interdependent.

Microsoft said the new reporting structure indicates a growing focus on business applications that help companies coordinate their accounting, staffing and inventory-tracking activities.

"Our commitment to bringing business applications to small- and midmarket-segment customers throughout the world is unwavering," Burgum said in a statement.

The company entered that market in 2001 with the $1.1 billion purchase of Great Plains Software, putting it into direct competition with Lawson Software, Britain's Sage Group and numerous other software companies that cater to midsize businesses.

That's when Burgum, who was chief executive of Great Plains, joined the company. He's still based in Fargo, N.D., at Great Plains' former headquarters.

Since then, Microsoft has expanded the unit internationally with the acquisition of Danish software maker Navision. It has also added new product lines, introducing a set of applications for coordinating sales, marketing and customer service. The company says it will invest $2 billion annually for the next five years in sales, marketing and development efforts targeted at small and midsize business, or companies with less than $1 billion in annual revenue.

Microsoft doesn't report the unit's finances, but AMR Research says it brought in about $659 million in revenue for the company last year, a sliver of its more than $32 billion in annual revenue.

Microsoft has a 3 percent share of the $21 billion ERP (enterprise resource planning) market, behind, in ascending order, Sage, Oracle, PeopleSoft and SAP, according to AMR. Although Microsoft's market share is small, it's among the fastest-growing, with 60 percent revenue growth last year, AMR says.

[mas90guru]

Looking for a spinoff soon.

This is the first step toward what I think will be a spinoff of the accounting software. The revenues and headaches of managing a reseller channel might outweigh the revenue potential for MSFT. Plus this is not an area that they have a lot of leverage or can build functionality into the OS. I think Intuit would be a great purchaser of some portion of the accounting apps.