Similarly, we continue to see very rapid acceleration in the use of microprocessors and more advanced software in many devices. I can remember many years ago, when we were developing Windows CE and Pocket PCs, people would say to us, hey, we've got this little Palm Pilot and that's all we ever need. Today, that looks pretty antiquated. People are now saying: We like these smart phones and Pocket PC phones with integrated cameras, WiFi, Bluetooth, IP networking, Web forms and all these other things all on my pocket computer. I'd like to believe that we were more accurate in forecasting how the world would move towards expecting this level of technology sophistication.
We also see the evolution beyond typing and point-and-click kind of interfaces. Lately, we've been doing a lot of work in machine vision, and so we would hope that in the years ahead we'd be able to extend the modalities by which people interface with these computer systems, and therefore make the interactions with computer systems more like [how] you would interact with another individual.
You mentioned that the lead time in bringing an idea out to the market is long. What are the challenges in predicting what people want and having the conviction to follow through the ideas?
Getting acceptance is in many ways a process of success and refinement. Even if you have the right vision of what's going to happen, it's difficult to get all the pieces right the first time. So for example in 1992, we were more focused at the time on ATM (Asynchronous Transfer Mode) networks rather than traditional IP packet-based networks, because at that time, the network operators were investing more heavily there. As IP networks matured and [due to the rise] in the Internet phenomenon, there was a gradual shift.
| I'd like to believe that we were more accurate in forecasting how the world moved to expect [a high level] of sophistication [in handheld devices]. |
We were able then to migrate our early work from TV-based on ATM-type switch telephone networks to an IP packet-based system. Today, Microsoft is the world leader in IP-based TV systems. You not only have to have the right idea, but [you also need to have] the ability to stick with it, which is a cultural issue, a financial issue, and a willpower issue. Microsoft has been fortunate to have command of all three of those things.
How does Microsoft foster the spirit innovation within the organization?
I can look at this along three different horizons and organizational approaches. Firstly, I think it's important to have a pipeline of partially-directed research. In other words, [having] people who are trying to develop core technologies but not operating under the pressure of an immediate product deliverable. So when they begin, they do not know what outcome they would expect to get other than we hope that they would produce some useful core technology. We've got company research activities in around 60 areas that may be important in our broad product lines in the future, and we make that as a baseline investment.
The second thing that we do is to support incubations. Some of those are sponsored by the CTO office and some of those are done by teams focused on incubations within individual business groups. I define incubation as an attempt to nurture something that is not a pure research activity any longer, but where it's not exactly clear either what the 'productization' strategy would be, or how long it would take to be achieved. And so, you require people who are a bit more entrepreneurial by nature, and who is, to some extent, able to take some personal time and career investment risk to seek a novel new product or new market strategy.
The third area is essentially the normal evolution of the products. By listening to the market and getting feedback from customers, and being willing to adapt, you get another form of innovation. For example, when people look at the new version of Office, which is in beta test right now, there is quite a radical change in the basic model of the graphical user interface for the Office system. So on one hand you could say hey, it's still Word, Excel and PowerPoint…What's the big deal? On the other hand, if the change in this interface really makes it easier to introduce more sophisticated capabilities, for example, to embed real-time communications and collaboration in what was historically a personal Office suite, then that's a breakthrough in its own right.
When you realize that there are hundreds and millions of people who spend many hours a day working with these tools, and if you could come up with a way of improving their productivity--even by what appears to be small percentages amplified by the number of people doing it everyday--that actually has a material effect.
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