Chapter & Lesson #13

Chapter 13 

 

“It takes a leader to create the momentum, it takes a vision to direct the momentum, it takes a massive action to build on the momentum, and it takes self-discipline to sustain the momentum. Momentum is the bridge between a vision and its results. 

Farshad Asl 

 

After the big launch of MSN 8, and the total self-destruction at AOL Time Warner.  The damage was done,  AOL no longer looked like a threat to Microsoft.  The momentum had changed, for both companies.  New Internet darlings were being formed, and the fear of AOL stealing Microsoft’s relevance seemed almost silly in retrospect.   Many in the division said that we had followed AOL right over the cliff.  Now both seemed to be dead.   To me that description, while harsh, felt accurate.  MSN was still losing money and had no clear reason for existing now.   Sure, everyone at Microsoft understood that the Internet was important, but it was now less clear how important it was to Microsoft specifically.   Microsoft was still selling Windows and Office successfully and was becoming increasingly strong in the enterprise software space.   Leaders all across the company were growing tired of losing money on MSN, without the threat of irrelevance looming from AOL, the investment in MSN seemed more and more pointless.  

Without a raison d’être the MSN  Division was sent into a state of chaos.   The battle was over, Windows had no looming threat from AOL.  Yahoo! looked like an interesting business.  But never seemed to represent a big threat or big enough opportunity for Microsoft to take seriously.  Google was starting to look like a serious business to many of the people who worked in MSN, but CEO Steve Ballmer seemed to have absolutely no clue of how huge search would be.   Ballmer totally missed that Google was setting up to shake Microsoft to its core.   All the winds were out of the MSN sail.  It was a division with no momentum at all, it was losing gobs of money, and had no clear idea how it would ever make a profit.  MSN’s biggest problem was becoming its own existence. 

For the next couple of years, MSN and the Online Division at Microsoft was basically totally rudderless.  There would be multiple executive changes at the top, along with constant staffing reorganizations laced with new memos stating where the new focus would be.   As a middle manager, it got to the point that it was just embarrassing trying to explain the new goals and strategies the latest executive wanted to go after.   Almost every 6 months there would be a new division leader, new lieutenants would be named, and reorganizations would become a routine of life while working in that group.  It was painful to watch and be a part of it.  The silver lining is I was being paid well to put up with all of the nonsense.   Otherwise, it would have been totally intolerable. 

The oddest reorganization I remember was when Steve Ballmer named a guy who was a friend if his,  and one of his “mentees”, to head the Marketing and Business functions of MSN.  This guy (who I won’t name) had made his reputation at the company leading the battle against Linux.  Linux is an open source software program for operating systems, where people and organizations donate code that is then freely available to anybody who wants to us it.   Open source was considered to be a huge threat to Microsoft’s proprietary and closed Windows Operating System, where Microsoft made most ofit’s huge profits at the time.

This new guy’s claim to fame at Microsoft was that he had crafted a marketing campaign called “get the facts” which was a successful competitive smear campaign on Linux.  It used all the fear uncertainty and doubt you could muster up, to scare IT managers and developers away from using Linux.  Steve loved it, and apparently loved this guy.   Within a few weeks of him landing in our buildings across the freeway from Microsoft’s main campus, it was clear that this guy was a gun slinger.

One of the most outrageous things about the new guy was that he had 2 business managers, one of whom was an extremely attractive young female.  The other, who was not as attractive, seemed competent enough.    (It is not unusual for a senior executive to have a one business manager at Microsoft.  These roles basically do all the dirty work that executives don’t want to deal with.  They organize staff meetings, they take personnel meetings that the executive himself does not want to take or have time to deal with, they deal with administrative type stuff)   The consensus on the team was that 2 business managers for this relatively small group was far from necessary.   More concerning to the business, nothing was happening with this guy’s leadership, he seemed to be traveling all over the world, not leading the group in any direction at all, or making any decisions.  One odd side note, that everyone on the team noticed, was that his beautiful business manager was traveling with him on extended trips.  This was very unusual, in fact, it was much more common to see business managers stay back at HQ to handle any routine things that might come up while an executive was out traveling into the field.

On one of those trips, apparently, Steve apparently received a heads up that some hanky-panky was going on.  To Steve’s credit – he put an immediate end to whatever was going on, and this particular leader never returned to Microsoft.   The details were never revealed to the team on exactly what happened.  But it was clear, something had gone very wrong with this rising star’s career, and it was likely a result of personal misconduct.

That VP’s firing was sort of a sign of the rudderless times in that division.  Another leader lasted only 6 months before he had a nervous breakdown.  Another was hired in from Kimberly-Clark who had worked on the Pampers brand, she was a disaster.  Diapers and software are not very deeply related, I remember a meeting where I had to explain to this person what Internet Explorer was, literally she did not know what an Internet Browser was, or how it was different from Yahoo (the web portal).   I knew she would not last past 6 months in that job, and she didn’t.    I could never quite figure out why she was hired in the first place.  

The place was a mess.  We had a running joke on the team that our job was to educate the newly named executives as they passed through the division.  We put a sign up on our doors that read “EEC” which nobody outside of our group knew what it meant, it stood for “Executive Education Center”.  It was one of the more idiotic corporate jobs I had ever been a part of.  I finally decided I had too much of the drama, the stupidity and the bridge to nowhere mentality that was taking over in the online group.  I started looking to get out and move to a division with more focus and better opportunity to keep my career moving forward.   It was a wise move.

 

 

Learning Lesson #13   Momentum is as important as any feature when working Technology.   I was lucky enough to get an up-close view of multiple big platform battles while working at Microsoft.  I learned that “capturing the narrative” of winning momentum is as important as any product feature you can deliver.

Momentum can come in many forms.  You can be far behind a competitor, but if you are stealing away market share from them, you can translate that into your own momentum.   Or you may be losing a lot of money in a business, but if you are reducing that loss significantly QTR over QTR that also counts as momentum.   You may launch an obviously technically superior offering, and if you can keep that superiority gap over the competition, even if you are not gaining share or profits yet, that can still be good for momentum.   

The ultimate in momentum is when you are taking share, increasing profits and or gross margins, and delivering a product that is perceived as better than the other guys.   If you have all of these things in your favor at any company or division, you will be riding high while it lasts.

Momentum convinces the press, customers, partners, and even your own employees that you are winning a battle.   The momentum is what creates the necessary resources to keep the battle well-funded, and the army well motivated.   If momentum dies you go to the grave with it, this is what happened to Nokia, Blackberry, Netscape, HP, Yahoo, MSN, AOL, Bing and a host of so many other great companies and products.  

You can be way behind a competitor, but if you have more momentum, if you are stealing away market share, mind share or both, you can be perceived as winning. 

This is a critical element to recognize in technology competition, primarily because things change so quickly in technology.  You can be the leader one day, and in the doghouse the next.  Technology companies run on fear, and if you are not beating the competition, you are losing.  In the winner takes all world of platforms battles, losing means long days trying to reinvent your product, your company, and your reason for being.  Thus momentum is everything.  

If you find yourself in a place where there is no momentum and little hope in finding it, consider making a move elsewhere. 

 

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