Ballmer: IBM in the crosshairs

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Air cover.: Paying attention to what Mr. Ballmer says can give some insight into Microsoft's thinking. Seems worthwhile, expecially for those opposed to Microsoft.

Let me help.

This was a speech to higher level executives.

The first point is that these executives are giving this attention to a very small part of the company's budget. IT is not the biggest share of the budget, and Microsoft is a small part of IT's budget.

Quoting:

Number one, I'd say in most big accounts, even though we're very successful, our software represents maybe 1 or 2 percent of the IT budget. If we get two-and-a-half percent of somebody's IT budget, that's a big deal for us. The money that actually goes to Microsoft is relatively small.
EoQ

So a company can easily think of payments to Microsoft not as an issue, but as a comparatively small piece for certain needs to be met.
Worth remembering when doing cost comparisons for large companies. Any savings are going to be so small, in context, that they're not very significant.

The second part is that Mr. Ballmer is doing the presentation not to create a counter to hostile statements from IT, but because IT wants Microsoft to help IT justify intended expenditures on Microsoft products.

Quoting:
Most of our enterprise IT customers and partners say: "Look, you got to create the air cover for us. If we're going to create these kinds of solutions to let our business be 'people ready,' it can be just us talking. Microsoft, you have to talk too." I actually get a lot of feedback from IT customers, who say: "Look, whatever the business message is, you have to help us with the air cover. We'll talk specifically about the technology."
EoQ

Microsoft has to explain not the technology but the benefits in business terms. IT will defend the choice of Microsoft.
This helps give context to the feeling that the quality of Microsoft's products is considered... less than optimal.

The contrast is to IBM.
Not IBM as a software maker and provider. But IBM as a potential IT opponent, with consultants and out sourcing.

Quoting:
And I think IBM's point of view is it's all about the consulting project or the outsourcing. What we would tell you is...we believe in giving people the tools that let themselves collaborate, get insight, deal with exceptions.
EoQ

Microsoft is defending the ability of in-house IT to meet the needs of people outside IT.

Hiring a consultant or out-sourcing can't be an endorsement of in-house IT. Microsoft's role is to protect IT in the company.

And the defense is that Microsoft software helps meet people's needs.

So I guess the conclusion is, be grateful that Microsoft can gather executives together and be heard. IT needs the help.

Microsoft has to expand its contacts outside IT and into the executive suites. The company has been too interested in those who share the company's interest in software.

Quoting ZDNet's summary:

Why? Because business managers, marketing executives and other nontechies are increasingly involved in technology purchasing decisions, Microsoft argues.

Another reason for the shift is IBM. Microsoft's chief rival in the business software area has been pitching to CEOs for years, relying on its business-savvy consultants to help win deals. In essence, Microsoft needs to speak Big Blue's language.
EoQ

The ones who've been getting around IT and into the executive suites work for IBM.; Posted by: Anton Philidor Posted on: 03/18/06 You are currently: a Guest | Members login | Terms of Use