I’ll admit it, I am a product of 70’s sitcoms, primarily The Brady Bunch. Who among us cannot remember Peter Brady belting out his memorable line “when it’s time to change, you’ve got to rearrange…” about change in the midst of teenage angst and puberty Brady style!

Well, the software industry is well beyond puberty and really has to change and rearrange. The software industry is no longer about software…it has to change and rearrange to be a hybrid.

Microsoft is, without question the definitive quintessential software company. The problem is the company is, at its core, an operating system company. Everything Microsoft is and does is about selling and installing more copies of Microsoft Windows. Windows is the franchise product – period – full stop! Now, this is not an entirely bad problem to have, but what about the future. People and enterprises are no longer paying in excess of $500 (US) for a single productivity application to put on a proprietary closed operating system.

Microsoft has to change from being a software company and figure out how to become more of a hybrid company. Hybrid is defined as providing solid software but supplementing that software with some sort of viable services. The services supplementing the software can be either professional or managed. Given Microsoft’s ability to build out an ecosystem of partners and in effect show more feet on the street, it makes sense for Microsoft to look at ways to deliver managed services as well as figure out some crafty way to extend the usefulness of its traditional Microsoft Office product line. True to its ways, Microsoft is attempting to achieve both by delivering managed services as well as exposing the Microsoft Office line as a development platform.

At the Tech Ed 2006 keynote, Bob Muglia, Microsoft’s Senior Vice President, Server and Tools business eloquently stated how the new Office 2007 will really extend the development platform by being extensible and by becoming truly integrated and most importantly, just working. The just working part of this equation is the piece that will make interrupt driven knowledge workers and field workers take notice.

What Microsoft has been wise enough to realize is they have won, hands down, the desktop productivity war. It is beyond ridiculous for anyone to even attempt to erode that market. But, this realization has two parts…Microsoft also realizes that we have become e-mail addicts and most of us are addicted to Outlook – this bodes well for Microsoft. We live on our desktops in Outlook, a push sort of environment. And, for those of us with Smart Phones, what do we do most frequently? We obsessively check our e-mail. So, this simple realization gave birth to what may very well be Microsoft’s most brilliant plan. The plan is simple…give people what they need where they spend the most time. Microsoft realized the abysmal failure (my assessment) of the promised land of CRM. Microsoft also realized the promises of CRM , while never delivered, are not all bad, it is really a matter of implementation and understanding the human way people work. Hence, we will soon see Outlook, the addictive application, be used for everything we want and need to search on, store, and send. After all, we have so much information that we always need to figure out where it is.

Microsoft took a fundamental assumption of massive market penetration of the Office product line and inverted it. By doing this, we are going to see something bold and new come to something reliable and familiar.

Microsoft is figuring out how to change and rearrange.

What’s next?...less is more, especially in software development.
t