Table of Contents
Core business activity and innovation.
Microsoft s competitive advantage.
Research and Development at Microsoft
Demand push innovation.
S curve at Microsoft
Utilization of innovation strategy.
This report highlighted the innovation strategy adopted by Microsoft has developed a strong R&D department to drive innovation through incremental innovation. Microsoft through its innovative strategy has maintained dominance in the operating system and cloud service. The company has used incremental innovation in establishing platform-based service.
Microsoft is a technology company headquartered in Washington (Microsoft 2020). The company develops, manufactures, operates, and sells computer software, personal computer software related suit. The company has a flagship touch screen and gaming consoles in hardware products (Microsoft 2020). This report highlights the role of innovation and strategy followed by the company and its operations in the technology innovation strategy of the company.
Microsoft's majority revenue driver is its two core business Windows and Office. Microsoft under the guidance of Satya Nadella has focused on market-creating strategies with Azure cloud (HBR 2020). Microsoft s productivity and the segment have products such as Office 365, Skype, and LinkedIn. Microsoft's Innovation Management Framework is designed for enabling technologies as strategic architecture within the company process. Microsoft has developed and designed significant disruption with witnessing digital transformation firsthand. The company has used cloud computing and computing software to center innovation in its product offering. The five primaries Envision, Engaged, Evolve, Evaluate, Execute (Microsoft, 2020). It has focused on innovation through AI initiate in new technology introduction in wearable, process, and platform service.
Microsoft's productivity and business segment include licensing and subscription for Office by commercial and consumer. The cloud segment has contributed to 30% of the revenue with gaming and search advertising (HBR 2020). Microsoft keeping with the trend has developed cloud serve and AI for strategy and transformation by adding innovation to Azure. The software‘s designed to keep pace with business shifts.
The use of SQL data through Azure has shaped the instant data movement with compute nodes with faster inquiry to power cloud solutions for business (Microsft Azure 2020).Microsoft through its enterprise technology focus hold market share in enterprise software and service through office suite and Azure. Microsoft through investment in AI uses gaming console and augmented reality handset for extension of service from PC called HoloLens (CBI Insights 2019). Innovation through augmented reality and Dynamic 365 for a remote asset the application act as a power source for workplace dimension and support function. It has developed computing software and Azure docs have become the fastest growing open source project. The bundled product through platform service improves customer experience and customer base addition (Microsoft Azure 2018).
Microsoft s Research and Development team supports research, technological innovation for industry colleagues and academic institutions. The company has focused n innovation and opportunity in cloud computing.
Microsoft has functional areas of research such as artificial intelligence, computer vision, and human-computer interaction. Microsoft‘s core business division in platform and analytics for quantum search in using data security enhancement and optimization of problem. Microsoft has a specialized unit as Microsoft Research Lab working in the above area or driving technology and innovation (Microsoft 2020). The research and development framework creates a growing tool for customer needs and developing new products and technology in the area of future growth. There is a strong relation between R&D strategies in building business for competitive advantage for a productivity boost. Microsoft has created a global platform for research. Microsoft promotes continuing education grants, university liaison program and corporate research
The factors that impacted innovation are strategic orientation in product development. The company through demand all innovation failed with Skype in creating a P2P platform that was not feasible for both mobile and PC use and was subdued by other video calling devices such as Skype. The innovation at Microsoft can be characterized as demand push innovation with building innovation by unmet customer needs. Customer demand for Web-based application helped Microsoft develop demand towards video service, folder creation, office support, and bit integration in its office dynamic suite and Skype application development. Microsoft has a strong delivery platform that assists it in creating a business platform (Microsoft 2020). The optimal entry is important as followers have a competitive advantage as in the case of word process and spreadsheet software (HBR, 2020).
Red ocean strategy by the company -Microsoft is selling the product that is in demand and beating the competition in the existing market. They highly focus on incremental innovation strategy. Microsoft thinks about the historical core market and wins share (Forbes, 2015). They have not involved in radical innovation during the current period. The company in its innovation process at a research lab and center design through empathy mapping to analyze the project.
The firm has set incremental innovation through product development through incremental innovation in close services and office suite with collaborative open source and access. The focus on process innovation.
The competence enhancing innovation through Azure and Xbox using the existing knowledge base. Similarly on comment innovation wit modular change in an office suite for the new addon. Microsoft to its strategy has changed from product to platform has been successful with the outlook in converting into a platform with the cutting of competition through integrating services in office suit by adding Evernote and Yelp.
S curve denotes how products, services, and businesses have evolved over the period. It captures market adopter till obsolesce of the product. Microsoft has focused on the process of process innovation through AI, quantum computing, and cloud system. The Azure has been building the competence enhancing innovation through privacy and security network (Microsoft Azure, 2020). Microsoft has used process innovation to its advantage. The use of remote inspection has helped the firm in touchless recognition for image processing in measuring impact (Microsoft, 2020).
Microsoft through its dominant design has market share dominance in window systems and spreadsheets with its office suite. The rapid change in technology is owning to customer demand and new learning and adaptability. The collaborative network and cloud computing are widely used with AI/ML use computing and the design interface in process improvement is faster (Mckinsey & Co. 2018). Microsoft has paced itself with customer needs and market potential and competition
Microsoft made IBM obsolete with window upgrade and built on Team dynamics and office support with slow acceptance and leveling growth (Schilling 2018). Currently, the Office dynamic and cloud service are in the growth sector. The tapering point in office suite impacted Microsoft with office suite as Power BI the firm has innovated by increasing its cloud serve development and processor to state relevant in the network.
The S curve is cyclical with initial period turbulence with improvement and displaced by another technology before discontinuity (Schilling 2018). The emergence of discontinuity act as a creative destruction process. Microsoft's design is the dominant design cycle with incremental improvements.
Microsoft through Azure has critically shaped the company s long-term growth as it offers standalone solutions as well as software and computing foundation. Azure offers hybrid could service and is a revenue driver for the firm and is one of the competitive advantages of the firm. A s a club computing hybrid system it provides the infrastructure that connects private and one premise cloud service. The AI and commuting services have taken over the Amazon planet application. Microsoft is building Azure as a wold computer through data application and new edge computing. It s a cloud-based extension such as Power BI acts standalone SaaS product (CBI Insights 2019). The enterprise through cloud servicing as the future has the potential to transform software and gaming.
The company’s investment in artificial intelligence and open source software has created dominance in enterprise technology space. The product and platform service through incremental innovation and research capabilities has potential in AI for innovation. The company is recognizing investment acquisition philosophy for a growing business segment with innovation to maintain a competitive edge.
As grassroots innovation, Microsoft can follow an organic structure for the free flow of ideas in research and capabilities lab to ensure experimentation is increased in the capacity of individual work (Chao, 2017). Microsoft should ramp up external invest for developing product platforms through its R&D and market positioning for strengthening innovation.
CBI Insights. 2019. Microsoft Strategy Teardown: Cloud, AI, and subscription, and the next trillion-dollar company. [Online]. Available at < https://www.cbinsights.com/research/report/microsoft-strategy-teardown/> [Accessed on August 11, 2020]
Chao, R.O. and Kavadias, S. 2017. Innovation strategy at Microsoft: Cloud on the horizon. DOI: https://doi.org/10.1108/case.darden.2016.000164
Forbes. 2015. Surface 3 and Apple watch, red ocean vs blue ocean strategy. [Online]. Available at < https://www.forbes.com/sites/adamhartung/2015/04/02/surface-3-and-apple-watch-red-oceans-v-blue-oceans-strategy/#47eb08c3ea25> [Accessed on August 11, 2020]
HBR. 2020. How to build resilient growth through the business cycle. [Online]. Available at https://hbr.org/2020/03/how-to-achieve-resilient-growth-throughout-the-business-cycle [Accessed on August 11, 2020] > [Accessed on August 11, 2020]
Mckinsey. 2018. Microsoft next act. [Online]. Available at <https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/microsofts-next-act > [Accessed on August 11, 2020]
Microsoft Azure. 2018. New Azure innovation advances customer success for the cloud- and AI-powered future. [Online]. Available at < https://azure.microsoft.com/en-in/blog/new-azure-innovation-advances-customer-success-for-the-cloud-and-ai-powered-future/> [Accessed on August 11, 2020]
Microsoft. 2020. About Microsoft. [Online]. Available at <https://www.microsoft.com/en-in/about/> [Accessed on August 12, 2020]
Schilling, M. 2018. Strategic management of technological innovation: McGraw Hill Innovation
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