Microsoft, a company known well for its operating systems and productivity software, is currently one of the world’s most valuable companies, valued at around $1 trillion, as of 2019. The value stems from a strategic shift by Microsoft from their obsessive focus on the Windows operating system to a focus on delivering cloud services and embracing open source. This turnaround is not only affecting the planning and strategy of Microsoft, but also caused a major change in their employees and the company culture. 

There has been a tremendous growth in cloud services, as more and more companies store their data in the cloud rather than on-premise. Microsoft’s Azure cloud division has grown rapidly and is strongly competing with Amazon’s cloud services. Judson Althoff, EVP Worldwide Commercial Business at Microsoft says, “It’s not about selling product anymore,” he said. “It’s using cloud services to transform their business. This new wave of compute – the intelligent cloud and the intelligent edge – will shape everything we do for decades to come. This is your opportunity. This will create more opportunities for the Microsoft ecosystem than we have seen in our history. It’s not some science future story. It’s here and it’s now.” 

Interest in the cloud has not only changed the way companies save data, but it’s also changed the way the providers make their money. The method that Microsoft accounts for their sales has completely changed with the new strategy. Before, money was earned by customers buying licenses for the software operating systems. Now, money is only earned with the time that the customer uses the cloud service. 

Critical Thinking Questions 

1. Trace the history of Microsoft’s financials. Use Excel to graph its stock value to see when the turnaround discussed in this case began to have an effect.

2. Microsoft was able to make meetings less frequent but more productive. Research the Internet for software that enables productive meetings. Choose one that looks the best and write a one-page paper on its features.