Microsoft Company

Compilation 2

Microsoft Corporation is one of the most renowned names in the global IT industry. With a core business of software solutions, Microsoft also deals in other IT sectors such as cyber entertainment industry, online communication, smart phones and hardware peripherals. Microsoft has been keenly studied by computer industry watchers, not only for its leadership of the PC software industry, but also for its novel software development processes and management techniques. Microsoft has eschewed many of the long-standing practices of the established software industry, such as rigid specifications, formal project management techniques, and elaborate quality assurance programs. By contrast, the company has developed a flexible, user-centered approach in place of rigid specification. It uses small programming teams and the discipline of the “daily build”—producing a complete working version of a product daily during its development—to achieve project convergence. The result has been to produce richly featured software that is sometimes late in delivery and sometimes underperforms in terms of speed and reliability. The market has thus far been willing to live with these shortcomings for the benefits of a high degree of functionality (Phelps, pp. 6).

Microsoft's managerial practices have been much commented upon, particularly its lack of organizational hierarchy, and Gates's intimate personal control over all aspects of the business. Outside the information technology industry, Microsoft's elitist human resources policy of “hiring smarts” has been of particular interest. Microsoft—often Gates personally—has sought out the brightest and best for its employees: the company has attracted star players from the existing software industry for senior positions, and has recruited top graduates from American university campuses for its junior positions. Many Microsoft employees have become rich from stock options. This had made the company extremely attractive to young professionals; Microsoft is able to recruit only a small fraction of the tens of thousands of job seekers who make applications for employment each year. There have been some hostile press reports of exploitation and burn-out among Microsoft employees, but this has not been substantiated by the more analytical literature (Bick, pp. 5).

The porter's five forces model shows that, suppliers and customers have slight authority over Microsoft. Substitutes such as all-purpose computers have very small market share in comparison to consoles, in overall gaming market. The reason for this small share is that the all-purpose computers are not optimized for playing games. The impact of potential entrants is translucent now, but the pace of the ...