“We can’t do this product. . .it will put us out of business.” –SteveB on the Office.NET plans shortly before presenting those plans to the entire team after a year of planning.
Welcome to the only project I worked on that had the plans upended at the last minute after one executive meeting. This is a journey that starts back at the 1999 Company Meeting and the unveiling of “Software As A Service” bet the company strategy. With many excerpts and artifacts, we will go through planning Office.NET where you’ll really get to experience the product planning process in Office. Followed by a last minute change putting all that work at risk.
Back to 069. Mega-Scale, Mega-Complexity
In the fall of 1999 Microsoft held its annual Company Meeting at the old Kingdome (a stage was set up over second base). While most of the world was fixated on the rise of internet sites or more likely the looming Y2K crisis, both SteveB and BillG used their time to begin a transformation of Microsoft—the transformation to a software services company (this would later be called cloud computing). Few even in the industry knew what this meant. Pioneer Salesforce.com was just months old and the original cloud infrastructure company Loudcloud (started by web browser pioneer Marc Andreessen and former Netscape executive Ben Horowitz) was incorporated just a week before the Company Meeting. This was very early, but it was also very big. Even though Microsoft was at the peak of success and the most valuable company in the world, the company was going to be reinvented. It was powerful.
BillG spoke first. His opening was dramatic—a reinvention of the core mission statement for Microsoft—the title slide was “Changing the World of Software”. From the meeting transcript:
The vision statement that many of you have heard, year after year after year, we actually decided to change. That statement, a PC on every desk and in every home, running Microsoft software, is still true. It’s a great vision. It really drove the company for the twenty-four years that we’ve been in business. But in some ways it’s outdated. Not outdated because it’s wrong. But outdated because it’s not revolutionary. When you hear that statement today, you say yeah, of course, what else is new. PC’s are in sixty percent of U.S. homes already. The prices are coming down to a point where increased penetration is very, very easy to predict.
But Microsoft is a change agent. We’re not just about taking the software we’ve done and making it a little bit better. We’re about changing the platform. Taking the kind of risks we took when we bet the company on graphical interface or bet on a Windows NT. We’re embarking now as big a bet, or I would say, a bigger bet than any of those. It’s captured in this new vision statement. Empower people through great Microsoft, internally we say Microsoft, externally we just leave that as implicit thought, great Microsoft software, any time, any place and on any device.
Now when some people in the company heard that they thought is that all really that much different? Is it something completely new? And just in the last month, Steve and I with a lot of help, from other people, have come up with a way of taking this vision and explaining what it means to our software in a way that is quite revolutionary. And that is by saying that from 1975 to 1998 the whole vision centered around the PC. It said the PC is getting more powerful, there is more and more things people are doing with it, just get the applications on to that PC and we’ll continue to lead.
Well, now we’re saying that although the PC will continue to be important that it’s actually the capabilities that are delivered through the internet, the services across the Internet that people will be thinking about.. They won’t be thinking about managing their files on an individual machine. They’ll want all their information stored in the network in such ways that any device that they pick up, a PC, a phone, a TV, a small screen device, they have access to the information they care about. That takes storage of file system that was purely PC-centric and makes it much more internet-centric.
This was classic Bill. There was a bold statement. An assumption that the company was willing to take on huge risk. Embracing the success while saying we could do much better. Then pivoting to a very specific technical scenario, and no surprise it was data storage. He did this exact pivot when celebrating the Windows XP launch with the team—great job, now about unified storage. There were demonstrations of web scalability on Windows, the new collaboration features in Exchange (including the Web Store discussed in previous sections). In something unusual for Bill, he ended his keynote by going through the newly created Microsoft Values, talking to Innovation, The Customer, Partners, Integrity, Diversity, Community, Entrepreneurial Culture, and People. A memo was authored describing these values, distributed to the company, and leaked to the local press (who often hung outside the Kingdome listening to the meeting anyway).