Competitive Advantage Case Study

Aging Microsoft

OR

Abstract:
Microsoft, the largest technology company in the world, has become bigger, slower and less profitable than it was five years ago. The company relies on Windows and a suite of desktop applications for 80% of sales and 140% of profits. Newer products--the Xbox videogame machine, the MSN online service, the wireless and small-business software, have collectively accumulated losses worth $7 billion in four years. Analysts point out that Microsoft, with $40 billion in sales and 60,000 employees, had grown multi-layered and bureaucratic. Despite the restructuring exercise undertaken by Steve Ballmer (Ballmer), Microsoft seems to be steeped in bureaucracy. Ballmer plans to launch several new products and upgrade the existing ones. Will Ballmer’s plan succeed in rejuvenating Microsoft’s fortunes and boosting employee morale?

Pedagogical Objectives:

• The case outlines Microsoft’s rise, its product portfolio and its growth strategy
• The case discusses Microsoft’s new product launches and comparative performance of these products against the market rivals
• It discusses the reasons behind Microsoft’s declining profitability

Keywords : Microsoft; Bureaucratic; Multi-layered; Bill Gates; Ballmer; Operating System; X-Box; Small business accounting; Longhorn; MSN Search; Digital TV; Core Competency & Competitive Advantage Case Study; Microsoft Windows; Microsoft Office; Revenue; Technology