“Microsoft Hits Back as Google Muscles In,” Analysis of a Wall Street Journal Article

The Wall Street Journal had an interesting article about a week ago titled, “Microsoft Hits Back as Google Muscles In,” and it had us at Silicon Valley Research Group thinking about Microsoft’s latest strategic business moves to stay atop of the game.  As the old adage goes, “work smarter not harder,” and that is exactly what Microsoft is accomplishing by brining together a cloud version of its already successful and established Office Web Apps when it introduced Office 365 to the market. Google has been doing really well with its Google Docs and Apps products and Microsoft has definitely taken notice. With Office 365, Microsoft is looking to maintain dominance in enterprise computing, by competing more forcefully for the small business sector.

Microsoft has been, and still is, the dominant force with business-software, but still needs to continue growing its enterprise business without missing a beat.  However one of Microsoft’s biggest threats is from Google, who according to WSJ has been, “encroaching on its business-software turf.” While Microsoft maintains a huge dedication in large enterprises, Google Docs and Apps have received a lot of attention from the small business market. Google’s small business appeal can be seen as a critical threat to Microsoft as it could be used to leverage into success with larger enterprises. Small businesses play a vital role for Microsoft’s future, because as some of them grow into larger businesses they would likely consider continuing to use their current software partners. If Google grew with these companies, they could become an even greater threat to Microsoft’s entire enterprise business. Office 365 appears to be serving as strong a business applications B2B market strategy and competitive response from Microsoft to help them maintain their business-software dominance in the short and long-term.

Industry analysts believe that Microsoft has been slow to embrace the cloud, focusing more on server-based applications, virtualization and other on premise solutions.  Office 365 is certainly proving skeptics wrong with its strong cloud computing B2B market strategy.  “Bigger mailboxes, less spam, improved collaboration, and time saving’s of 50% on support and more productive employees,” has been the difference for Cervus, a rapidly growing industrial equipment company. The ability for smaller companies to pick up Office 365 to help scale their own business is a huge win for Microsoft.  Customers report enjoying the fact that Office 365’s cloud system has helped kept their growing businesses organized and  “in sync.”

Microsoft and other companies really need to understand the customer anthropology behind the usage of their products. In this case, small business owners and their employees using Office365 need to be “shadowed” to determine patterns and habits of usage. In addition, users of competing products, most notably Google Docs and Google Apps need to be shadowed too for cloud computing competitive benchmarking. The resultant force field analysis map should be able to pinpoint strongest attributes of the product, not in the vendors’ judgment, but from the users perspective as well as weaknesses in the other offerings.

The force field map should reveal:

Maybe Microsoft came into the cloud game a little late according to critics, but it certainly has not disappointed and has been making significant efforts to ensure an awesome product; as well tying up any loose ends for future business endeavors.  Office 365 is the right fit for any organization, big or small looking to “work smarter not harder,” by boosting productivity by making it much easier for employees to collaborate more effectively in day to day business. 

What do you think?  Do you agree? We welcome your comments below.