There is a whole great literature on why companies can maintain dominance - for example, Michael Porter's "Competitive Positioning". Ultimately, it comes down to and mix of three things: unique capabilities, high entry costs for rivals and high exit costs for customers. MS, just like IBM before it, has harnessed the high switching cost component.
If you are purchasing for a company, you have another three things to consider. Your thoughts are always going to be relative - that is, relative to doing nothing, or using a rival product. You weight cash cost and intangible cost - disruption, retraining and so on. The three things are:
One: Will the product perform not excellently, but adequately: can they type, save, print; and will it crash or otherwise malfunction?
Two: What is the friction costs associated with the change: that is, loss of productivity while they learn something new, training cost and time, the cost of mistakes made by inexpert hands, incompatibility during roll out, incompatibility with partners and so on.
Three: Risk to me as finance/ IT director: risk that irritation will exceed satisfaction, risk that there will be major disruption, that the thing will be a nightmare to install, risk that my people will need retraining before they are competent, risk that our team will behave flawlessly but that brand new risks will emerge from within the new system.
Taken together, product bases such as MS (or IBM before it) represent a no-loss option. "No one ever got fired for buying Ford (or IBM, or...)" is a perfectly good marketing position to take, and MS have - up until now - taken to it very strongly. Windows plus Office answers extremely well to all generic corporate needs, with Oracle to hanled the big dB issues. Yoiu can find hundreds of external experts, your staff know how to use the products - there are probably billions of person hours of experience in using Excel or Word, for example - and a firm will feel that the three points above are covered very well.
However, and it is a vast, huge 'however' - companies can fell their own forest. IBM did it with the mass market IBM PC. That shattered the central Blue Priesthood (revertly placing punch cards on the Holy Blue Altar), enpowered distributed stuff and sank the firm.
So the critical question is whether, with its 2007 offer, MS started chopping at the trunks of its very own forest. There are two criteria for an answer to this question, which are:
= Do the new products offer advantages which exceed the cost of acquisition and transition? (Not: are they innately good, but are they relatively good?)
= Second, if life cycles mean that kit and software will be replaced by whatever is current, do the new products have negative qualities that will cause people to pause and rethink this cycle - will it shatter comfortable habit?
Vista seems to fail on question (1) but probably wobble through on Question 2. It oiffers no advantages, but it is not an active hindrance to the general user. Office 2007, however, fails on both criteria. It is actively worse for an experienced user than Office 2003 (See http://www.chforum.org/library/ms_office_discontin uity.html for more on this.) It is sufficiently awful for purchasers to get their butts kicked by internal customers if they try to force it onto them. One is talking of hundreds of millions of users here, and I have seen experienced staff pounding the desk and screaming at the screen as they try to forget a decade of learning and fiddle withthe bloody ribbon thing.
So: consider a 'sell' on that stock.
In common with many corporate users, we have had a look at these products.We have treated Vista in only a cursory way, as we have no need to change from XP and it conveys no clear advantages to us. Frankly, it seems to be a consumer product: good luck to it.
Office is a different issue. We generate a great deal of PowerPoint, and this is showing its age. The Open Office equivalent does not yet cut the mustard. So, we had a very frustrating encounter with Office 2007. We shall not be using it.
Several hundred million office workers use MS Office, and it is a major part of the MS cash stream. The Office 2007 UI is a major discontinuity for the work practices of this (impatient) community. However, in our evaluation, the product offers no meaningful improvement in what is on offer.
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There is a whole great literature on why companies can maintain dominance - for example, Michael Porter's "Competitive Positioning". Ultimately, it comes down to and mix of three things: unique capabilities, high entry costs for rivals and high exit costs for customers. MS, just like IBM before it, has harnessed the high switching cost component. If you are purchasing for a company, you have another three things to consider. Your thoughts are always going to be relative - that is, relative to doing nothing, or using a rival product. You weight cash cost and intangible cost - disruption, retraining and so on. The three things are: One: Will the product perform not excellently, but adequately: can they type, save, print; and will it crash or otherwise malfunction? Two: What is the friction costs associated with the change: that is, loss of productivity while they learn something new, training cost and time, the cost of mistakes made by inexpert hands, incompatibility during roll out, incompatibility with partners and so on. Three: Risk to me as finance/ IT director: risk that irritation will exceed satisfaction, risk that there will be major disruption, that the thing will be a nightmare to install, risk that my people will need retraining before they are competent, risk that our team will behave flawlessly but that brand new risks will emerge from within the new system. Taken together, product bases such as MS (or IBM before it) represent a no-loss option. "No one ever got fired for buying Ford (or IBM, or...)" is a perfectly good marketing position to take, and MS have - up until now - taken to it very strongly. Windows plus Office answers extremely well to all generic corporate needs, with Oracle to hanled the big dB issues. Yoiu can find hundreds of external experts, your staff know how to use the products - there are probably billions of person hours of experience in using Excel or Word, for example - and a firm will feel that the three points above are covered very well. However, and it is a vast, huge 'however' - companies can fell their own forest. IBM did it with the mass market IBM PC. That shattered the central Blue Priesthood (revertly placing punch cards on the Holy Blue Altar), enpowered distributed stuff and sank the firm. So the critical question is whether, with its 2007 offer, MS started chopping at the trunks of its very own forest. There are two criteria for an answer to this question, which are: = Do the new products offer advantages which exceed the cost of acquisition and transition? (Not: are they innately good, but are they relatively good?) = Second, if life cycles mean that kit and software will be replaced by whatever is current, do the new products have negative qualities that will cause people to pause and rethink this cycle - will it shatter comfortable habit? Vista seems to fail on question (1) but probably wobble through on Question 2. It oiffers no advantages, but it is not an active hindrance to the general user. Office 2007, however, fails on both criteria. It is actively worse for an experienced user than Office 2003 (See http://www.chforum.org/library/ms_office_discontin uity.html for more on this.) It is sufficiently awful for purchasers to get their butts kicked by internal customers if they try to force it onto them. One is talking of hundreds of millions of users here, and I have seen experienced staff pounding the desk and screaming at the screen as they try to forget a decade of learning and fiddle withthe bloody ribbon thing.
So: consider a 'sell' on that stock.
In common with many corporate users, we have had a look at these products.We have treated Vista in only a cursory way, as we have no need to change from XP and it conveys no clear advantages to us. Frankly, it seems to be a consumer product: good luck to it.
n uity.html/
Office is a different issue. We generate a great deal of PowerPoint, and this is showing its age. The Open Office equivalent does not yet cut the mustard. So, we had a very frustrating encounter with Office 2007. We shall not be using it.
Several hundred million office workers use MS Office, and it is a major part of the MS cash stream. The Office 2007 UI is a major discontinuity for the work practices of this (impatient) community. However, in our evaluation, the product offers no meaningful improvement in what is on offer.
Our take on the strategic implications of this for MS can be found at:
http://www.chforum.org/library/ms_office_disconti