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Agile Marketing Series: Case Study on Negative Feedback—Microsoft

Full disclosure: I’m an ex-softie. I loved working at Microsoft. Some of my fondest memories professionally are from my time there. There are so many wonderful and smart people at Microsoft I will never stop rooting for Microsoft to be successful.

Failure & Agile

In his article for Vanity Fair, author Kurth Eichenwald takes a pointed look at “Microsoft’s Lost Decade,” in which the company went from the most powerful player in technology in 2000 to a “me too” follower with bleak prospects going forward in 2010.

Although not named specifically in the article, I believe Microsoft’s challenges can be rooted in the culture’s challenge to fully adopt agile, top down thus hampering the ability to act on ideas that originated right under their nose: electronic readers, the touch screen, social networking and, ultimately (and a great moral injury to Microsoft), the operating system.

Bureaucracy Kills

As Eichenwald recounts in interviews with many former Microsoft engineers and managers, “Microsoft failed repeatedly to jump on emerging technologies because of the company’s fealty to Windows and Office.”

Office works with a keyboard, so touch screens were seen as laughable distractions. E-readers didn’t look enough like Windows. Why would anyone want to post small, instant messages that all their friends could see? That’s a stupid idea.

Get the picture? You don’t “know” anything.

Although the article places a heavy amount of blame on CEO Steve Balmer, Microsoft was most certainly full from the top down with managers who “knew” what would work. So certain, they couldn’t be bothered to listen to ideas for the Kindle or the iPhone or Facebook.

When leadership does not understand or value agile marketing’s emphasis on brainstorming and open, collaborative feedback within teams, EVERYONE suffers.

Instead of working together on new ideas to delight customers, team members fixate on each other and the inevitable is attacking each other’s jugulars with internal politics and passive agressive (and agressive) behavior. Instead of making up customer stories together in brainstorming activities, employees make up stories alone in their cubes with self-promotion and preservation as the guiding light.

And that’s just what I think happened at Microsoft. Somewhat famously in the tech world, Microsoft perfected the forced curve “stack ranking,” where teams and individuals have to be graded internally on a bell curve. This means that some people on the team will always get an F, no matter how well they perform—and especially they will get F’s if they come up with frivolous and “wrong” ideas like Facebook!

When you work in an atmosphere too acerbic for agile practices, this is what it sounds like:

“The far bigger issue, executives said, was a corporate culture that by 2001 was heading down the path of self-immolating chaos.”
“‘We couldn’t be focused anymore on developing technology that was effective for consumers.’”
“It leads to employees focusing on competing with each other rather than competing with other companies.”
“…executives said, a lot of Microsoft superstars did everything they could to avoid working alongside other top-notch developers, out of fear that they would be hurt in the rankings.”
“‘One of the most valuable things I learned was to give the appearance of being courteous while withholding just enough information from colleagues to ensure they didn’t get ahead of me on the rankings.’”

Where do you want to work? Anywhere but and environment like that. And if you’ve ever worked in an atmosphere like this, you understand how EVERYTHING becomes impossible.

You can’t get projects off the ground.
You can’t have a free exchange of ideas.
Nobody who loves to invent and come up with ideas stays there long.

Conclusion: Knowing too much is bad business.

Microsoft didn’t just lose out on new opportunities in the 2000s. It lost site of its core competency. Bringing innovation to market.

But you can work to train yourself to overcome DNA! Agile marketing helps you do that, with open communication, teamwork, trying-and-testing instead of knowing-and-killing. Everyone at the agile company is always marketing. Everyone at the agile company is always giving positive feedback.

And the best part is: you don’t have to “know everything.” In fact, knowing everything is the path to obsolescence in the market. People at firms like Microsoft are lucky to know everything, but that knowing removes the childlike mystery and collaborative gain in possibility.

Ignorance—not knowledge, order, and fact—is what drives the inquisitive, scientific mind!

As Stuart Firestein, Chair of the Department of Biological Sciences at Columbia University, says in his book Ignorance: How It Drives Science:

“Questions are more important than the answers. The destructive limit may not be to our knowledge; the limit that dooms us may be our lack of ignorance.”

Or, as Pablo Picasso famously summed up, “Computers are useless. They can only give you answers.”

That’s the agile mindset in a nutshell.

Microsoft is still one of the richest companies in the world. Although iPhone sales alone now amount to more than all Microsoft products combined, Microsoft is sitting on $53 Billion dollars in cash from past successes.

What’s next for the company? Agile or Die. And the detractors will tell you that “Financialization” is a good guess for where the company is headed.

Author Nicholas Shaxson defines “financialization” in a different article “Where the Money Lives” in the same issue of “Vanity Fair,”

“The term ‘financialization’ describes two interlocking processes: a disproportionate growth in a country’s deregulated financial sector relative to the rest of the economy, and the rising importance of financial activities with a focus on financial returns among industrial and other non-financial corporations, often at the expense of real innovation and productivity. [emphasis added]

“Some see the rising influence of finance and financial models in epochal terms. Author of Financialization and the U.S. Economy Ozgur Orhangazi summarizes academic literature that sees financialization ‘as one of the indicators of the decline of the hegemonic power’: imperial Venice, Genoa, Holland, and Britain all saw their rise on the back of productive industrial capitalism, followed by domination by the financial sector, which eventually began to cannibalize the productive sector in pursuit of financial returns—a process that ended in weakness and collapse.”

Vote Microsoft in 2012…or Vote Apple, Google, Facebook instead. It seems no coincidence that Shaxson’s article appears in the same issue as the article about Microsoft’s public challenges, because just as Microsoft has a choice to make, so does our country as a whole.

Will we choose a vision of innovating in the name of real productivity? Or, will we choose a vision of cannibalizing in the name of financial returns?

Will we work with passion to face new, inclusive questions we don’t know the answer to? Or will we manage rationally with the old, exclusive right answers?

Agile marketing means rapid adaptation and survival. Financialization means preservation of wealth and avoidance of loss. Perhaps they are gigantic opposites.

One thing is sure: The crossroads of the U.S. economy resembles the situation at Microsoft, writ large, which makes me pun-der:

What would Steve do to create jobs?
Would Bill preserve his capital behind gates?

And are these two men—and the companies they founded—gigantic archetypes for the paradox we’ve created between science and wonder in the Information Age? And are they ultimate public testing grounds for the success of agile?

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