Vanity Fair: Poor Management is Behind Microsoft's "Lost Decade"
July 9, 2012 1:10 PM
comment(s) - last by
Stack ranking and the inability to move up to new technologies were Microsoft's largest problems
contributing editor Kurt Eichenwald analyzed what he calls Microsoft's "lost decade," where a few bad management decisions led to the company's fall starting in the year 2000. Eichenwald used internal corporate records, interviews and emails between Microsoft executives to dictate his analysis.
From the information Eichenwald reviewed, he found that Microsoft
made a couple of huge mistakes
that led to its fall in the tech rankings: stack ranking and the inability to move up to new technologies.
After dozens of interviews with employees, Eichenwald discovered that Microsoft had been using a stack ranking management technique that put a lot of pressure on employees. Stack ranking means that each unit has a certain percentage of employees that are identified as top workers, good workers, average workers and poor workers. In other words, if there is a unit of 10 employees, it's understood that two people would be designated the top workers while seven employees would receive good or average reviews and the last one would get a poor review.
Using this stack ranking technique not only put a lot of pressure on employees, but also made employees want to compete with one another instead of other companies.
"It was always much less about how I could become a better engineer and much more about my need to improve my visibility among other managers," said Ed McCahill, a former Microsoft marketing manager for 16 years.
Microsoft also failed to take on new technological opportunities, such as the e-reader it developed back in 1998. A Microsoft team created the portable e-reader and presented it to Microsoft co-founder Bill Gates, but Gates was not impressed. He said the user interface didn't look enough like Windows. The idea was scrapped, and the team was removed from the reporting line to Gates.
Amazon later introduced the Kindle e-reader in 2007, which turned out to be a hit. Amazon now has an entire line of Kindle e-readers as well as the Kindle Fire tablet, and other companies like Barnes & Noble have released their own tablets as well (NOOK). It wasn't until April of this year that Microsoft embraced e-readers by teaming up with Barnes & Noble to create an
e-book subsidiary called Newco
While Microsoft has seen tremendous success with other releases during the supposed "lost decade" -- such as Windows XP, Windows 7, Xbox 360 and Kinect -- it doesn't seem to be enough to pass competitors like Apple. In fact,
alone brings in more revenue than all of Microsoft's products combined.
But Microsoft is looking ahead to its upcoming Windows 8 operating system and Windows Phone 8 for a boost. The new Metro user interface is unlike any Microsoft Windows release to date, and has been a topic of debate. Some feel it strays too far from the original Windows theme while others praise the change. The
10.6-inch Surface tablet
, which Microsoft announced last month, is also an anticipated addition to the company's family of gadgets.
This article is over a month old, voting and posting comments is disabled
RE: They expect it to change now?
7/9/2012 6:33:42 PM
They did something similar for both Vista and Win7 releases to defend against people saying "I don't want to buy a new PC now when it'll be obsolete in six more months". Dunno if they did the same for XP.
"Vista runs on Atom ... It's just no one uses it". -- Intel CEO Paul Otellini
Microsoft Claims it Killed the Start Button Because You Didn't Want it
June 28, 2012, 9:28 AM
Microsoft Announces 10.6-inch "Surface" Windows 8 Tablet
June 18, 2012, 7:21 PM
Quick Note: IE Reportedly Passed by Chrome -- Skepticism is Warranted
May 22, 2012, 2:09 PM
Microsoft, Barnes & Noble Team Up for "Newco" E-Book Subsidiary
April 30, 2012, 3:42 PM
Microsoft Launches Budget Lumia 640/640 XL; No High-End Devices Until This Fall
March 4, 2015, 9:10 AM
Finished Apple Watch Expected to be Showcased at"Spring Forward" Mar. 9 Event
February 26, 2015, 12:17 PM
Google Preps Pixel 2 ChromeBook, New X Server Replacement "Freon"
February 24, 2015, 11:12 PM
Report: Samsung Semiconductor Bounces Back w/ iPhone SoC and Memory Orders
February 24, 2015, 1:40 PM
Comcast Borrows Apple's Branding Flourishes for Its Remotes
February 24, 2015, 11:32 AM
NVIDIA Bows to Outraged Overclockers, Will Restore Feature in Upcoming Driver
February 23, 2015, 12:30 PM
Most Popular Articles
FCC Bans Data Discrimination, Defies Comcast, Adopting Net Neutrality Regulation
February 26, 2015, 4:03 PM
Google Steps up Snub of Adobe Flash, Auto-Converting Flash Ads to HTML5
February 25, 2015, 6:16 PM
Windows 10 Adds USB 3.1 for Dual-Role Peripherals, External Display Support
February 27, 2015, 11:39 AM
Australian Engineers Successfully Developed 3D-Printed Jet Engines
March 2, 2015, 11:08 AM
Smartphone STD Scanner Dongle Can Detect HIV in Just 15 Minutes
February 26, 2015, 11:04 AM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2015 DailyTech LLC. -
Terms, Conditions & Privacy Information