Microsoft Finds its Innovation Mojo

Microsoft is a bit like Tiger Woods at the moment - industry darling that became too dominant, then had a fall accompanied by a thick layer of schadenfreude, and now is trying a come-back. Microsoft is being replaced in the big-bad-wolf department by Google and Apple and finds itself in the odd position of being an underdog, and people love to root for underdogs. In fact I'd say that Microsoft is further ahead on the come-back trail than Tiger is if you look at some of its recent announcements: Bing, Windows Phone 7, the Courier journal concept, and the just-announced IE9. Something interesting is brewing in Redmond.

(And for context, I'll say that I'm a Mac user for 20 years and in the past have been quite critical of Microsoft's approach to innovation. But I also like to recognize credit where credit is due, and that's the case here.)

There are two things going on with their recent announcements that are really interesting, and which hint at better things to come still.

Finding its Innovation Voice
There is a clear editorial voice to what they are doing. In the past Microsoft was often criticized for producing warmed-over versions of other people's products (the perrennial Windows vs. OS X war), or for taking a "kitchen sink" approach that just stuck every feature imaginable into a product without thinking about how they gelled as a whole. Now they are creating products with distinct points of view that do not try to simply ape other successful ones, or out-do them on feature lists. You may or may not like exactly what each product does, but at least there is differentiation and an emerging personality to what they are doing, something Microsoft has long been lacking.

Systematizing Innovation
They have been able, to an extent, to systemetize an approach to innovation that began (it seems) with the Xbox team. The Xbox, especially the 360, established a fresh, distinctive approach to development that had been lacking at Microsoft. Innovating on behalf of customers rather than by linearly extrapolating what they say, consideration of a whole ecosystem, and then taking responsibility for the whole user experience in that ecosystem.

We see threads of this Xbox approach showing up in most of the new generation of products - Bing, Windows Phone 7, IE9, and Courier. (These are all products more or less at the edges of Microsoft's business, Office and Windows have not yet been affected so heavily. In fact the Windows advertising campaign flaunts the notion of just doing what customers asked, which these other products are definitely not doing.)

It was looking for a while that the Xbox might just be a one-off innovation high-point for Microsoft. Motorola experienced this with the Razr - a game-changing product that they weren't then able to convert into a broader portfolio and leadership of the industry. They could not systemetize the innovation process. After a couple of years, other phone manufacturers caught up to Motorola and today they are way back down in the rankings again.

Succeeding once at innovation is one thing, and can just be a matter of luck sometimes. Succeeding at it over and over again the way that Apple and Google do is a whole other ballgame. If current trends continue, this is what we are seeing going on at Microsoft. Given their size, resources, reach and clout, this could lead to some impressive stuff.

The Proof is in the Pudding
Windows Phone 7, Courier and IE9 all have one other thing in common - none of them have been released yet. They look at the end of the day there can be a lot of slip-ups between nice demo and game-changing shipping product. Microsoft has stumbled here before - look at what happened to Vista and Zune. But they've taken their lumps and perhaps now are ready. If so, we could be seeing a huge resurgence from the company which, after all, still has huge resources, dollars and reach. If they really can get their innovation groove back, from conception to implementation, then they will be a massive force to be reckoned with once again.