Microsofts Lost Decade - Microsofts Bureaucratic Structure - Case Study Example

Microsoft's Lost Decade

Microsoft’s bureaucratic structure

Microsoft Corporation has had tremendous successes and failures because of its bureaucratic culture. Although the company was one of the pioneer technology companies in terms of computer products and services, it continues to grapple with countless problems primarily because of management issues (Oreskovic). Bill Gates and his co-founder founded Microsoft on the premises of new technology that would redefine how the world operates. However, many loopholes in the management structure of the company led to its downfall either directly or indirectly. The company’s poor administrative structure has affected the company directly through its dismal performance that has been either fluctuating or on an all-time low, depending on the internal and external market environments (Eichenwald). Accordingly, the bureaucratic culture of Microsoft Corporation is unsuitable for fostering innovation and collaboration, and perhaps the company can adopt some effective strategies in an effort to meet these objectives.

Fiefdom is the primary bureaucratic structure at Microsoft and it entails a group of rich top managers attempting to control the company at all levels, the input of the other staffers notwithstanding. In essence, most of the managers at Microsoft Corporation have had the sole ambition of moving up the career ladder as opposed to focusing on their contributions to the company. Subsequently, the performance of the company has gone down relative to the emerging and existing companies that continue to take Microsoft’s place. The urge to mint more cash has overridden the drive to perform, and this situation has affected collaboration and innovation at the company in an adverse manner (Oreskovic).

The vast majority of employees at Microsoft seek managerial positions without necessarily evaluating their suitability or relevance in such positions. This urge has led to the creation of many senior management positions, a bureaucratic culture that is harmful to the company. As other companies such as Apple, Google, and Samsung attempt to lead in innovation, Microsoft is in a state of bureaucratic confusion where the managers focus on meetings more than they do on innovation. Consequently, the company growth is low because of the numerous red tapes instituted by the managers during various meetings. Besides, the managers are in a state of constant competition against themselves, a rivalry that is harmful to the company’s objective. Collaboration, which is a key aspect of growth and expansion, is no longer a priority for the management (Eichenwald).

According to analysis, Microsoft Corporation has critical bureaucratic issues that call for its reorganization. Such reorganization ought to touch on the structures that have been promoting fiefdom. Steve Ballmer, who is the company’s CEO, agrees that the most effective restructuring route is to consolidate power around the Chief Executive so that the other managers play supplementary roles. This move will go a long way in reducing the countless meetings that create red tapes that hinder innovation and collaboration. This process will include centralizing research expenses and marketing, both of which are business-related functions. The marketing and research teams at the company will play distinct roles without necessarily having overlapping roles that create unhealthy competition among the senior managers (Oreskovic).

The removal of responsibilities for revenue accounting and profit will enhance innovation within the company by allowing the key departments to focus on new technological products. The infighting that has been the key characteristic of Microsoft’s bureaucracy can be eliminated by encouraging the senior managers to embrace new ideas regardless of whether they have been proposed by junior staff. The managerial team and other staff member will not need to worry about the financial aspects of the operations because their focus will be on creating new products that will drive the market, such as the Xbox (Eichenwald).

Despite the flopped Microsoft’s objectives occasioned by unhealthy bureaucratic structures, it is worth noting that the company can restructure in various ways to attain these goals. One of the ways of restructuring includes sourcing for senior managers from other companies, particularly experiences personnel from related companies. Apple Inc. thrives on the fact that it sources for most of its top managers from other companies. Just like the case of Steve Jobs. Accordingly, Microsoft should develop a structure that discourages staffs to move up the corporate ladder within the same company. Through collaboration with other tech companies like Google and Apple, Microsoft Corporation can foster corporate exchange programs. Such exchange programs can go a long way to include the transfer of human resource and technology, which can be beneficial to the collaborating companies together with their employees (Eichenwald).

Microsoft's backstabbing culture

Over the years, Microsoft Corporation has developed a culture of backstabbing that is counterproductive particularly when it comes to nurturing innovation and maintaining high performance. The Xbox came as a potent innovation to counter Sony’s PlayStation and pother gaming giants. However, the infighting that exists among the Microsoft staffers gave the demonstration of the innovation a negative publicity. Additionally, Microsoft’s ugly corporate side showed up during the demo for Windows 7, especially its compatibility with Microsoft phones. Unlike their tech counterparts like Facebook, Google, and Apple that streamline their internal dispute mechanisms, Microsoft’s culture of backstabbing and infighting arise from its bureaucratic structure. Accordingly, Microsoft Corporation can adopt a few changes to counter the backstabbing culture that is injurious to the performance and innovation efforts by competent employees (Eichenwald).

Although Microsoft Corporation had performed well for some time, internal politics and competition hindered its growth and expansion relative to other tech companies like Apple and Google. Most of Microsoft staff view internal competition as a way of succeeding in their career although such competition usually leads to backstabbing and poor performance. Microsoft has come a long way to leave its fate to the greedy decisions of a few managers. The anticipated competition was to cripple rival companies through high performance and creation of innovative products. However, the competition has been directed towards co-workers with each staff members struggling to outdo the other while strangling innovation (Oreskovic).

In relation to high performance, Microsoft’s culture of backstabbing did a significant disservice to the company. The staffers worked towards failing their counterparts by jeopardizing any efforts that would have uplifted their internal rivals. The belief that reward came only through failing other workers was responsible to the financial downfall of Microsoft Corporation. Perhaps the situation occurred because of leadership failure, especially from the top. When Workers pulled one another down, the idea of creativity quickly vanished and all the workers struggled for survival against their internal enemies. Instead of focusing on high performance, the staffers attempted to outdo and jeopardize one another with the intention of reaping rewards to the managers (Eichenwald).

The constant internal knife fights and power play led to the derailment, death, and delay of potential explosive businesses such as the smartphone technology and e-book. While Microsoft was busy entertaining and rewarding internal knife fights, Google, Apple, Facebook, , and Sony were led the innovation path with each recording high performance along the way. It means that internal knife fights kill innovation, which in turn, leads to low performance at Microsoft Corporation. The poor performance is all evidence in Microsoft’s dismal revenue streams over the past decade when other corporations have been hitting unprecedented highs. Some analysts attribute the managers’ coalition to the series of in fights that have bewildered the company’s operations systems (Oreskovic).

Owing to the unsuitability of Microsoft's culture of backstabbing to nurture innovation and high performance, it would be appropriate to initiate a few changes. For instance, Microsoft’s corporate culture delves in crippling the competitors, which is rather wayward in the modern corporate society. Although Microsoft was the trendiest corporation in the tech world two to three decades ago, its fiefdom and backstabbing cultures have led to its downfall. The corporate culture of the company has largely been dependent on the coalition of managers to suppress the subordinate staff. Subsequently, all the staffs at the company have had the sole ambition of climbing up the corporate ladder to be managers at various departments. The focus shifted from attaining the company’s short-term and long-term objectives to personality contests within the company. Accordingly, Microsoft needs to change its corporate culture to survive modern trends in the tech world (Eichenwald).

The organization would thrive when only the innovators and high performer get recognition and rewards instead of the infighters. When the employees at Microsoft develop a culture of embracing new ideas in addition to putting in efforts to realize the success of such innovative products, then the backstabbing will stop. However, it is important to tackle the issue from top-down because the senior managers encourage the pattern. Accordingly, the company CEO should take a raft of measures that range from restructuring to fostering collaboration among the staff. When the Chief Executive inculcates a culture of teamwork among the employees, the infighting will cease because the employees will direct their energies towards the positive aspects of the organization (Oreskovic).

Managers' coalition

Managers’ coalition wields the greatest power at Microsoft primarily because of the bureaucratic structure that promotes fiefdom. The senior managers suppress the efforts of the subordinate staff, a situation that makes it difficult for the employees to work in teamwork. Subsequently, all the senior employees strive to reach the senior most positions so that they can manipulate the other employees. However, the managers have coalesced to form a powerful cartel that controls virtually every aspect of the company’s operation. The powers that the managers’ coalition has can have positive and negative consequences, depending on the intentions of the individual managers. The power emanates from various sources that are beyond the control of the company CEO (Eichenwald).

The power that emanates from the managers’ coalition emanates from various sources and it has hampered the efforts by Microsoft to meet its intended company goals. Another source of the power is the fact that the managers control both profitability and business-oriented tasks within the company. This scenario gives the senior managers more powers that their counterparts in other companies. Instead of suing the power for the effective implementation of the company goals, the managers use their powers to create in fighting within the company. The managers’ coalition is responsible for fiefdom and numerous in fights that have hampered innovation efforts by some staff within Microsoft (Oreskovic).

The bureaucratic culture at Microsoft has had far-reaching consequences on the company as far as innovation, collaboration, and performance are concerned. The bureaucratic structure promotes fiefdoms where every worker strives to attain managerial position, the company’s financial status notwithstanding. Backstabbing has been the in thing at Microsoft where some employees get reward from the senior managers by jeopardizing the innovative efforts of the competent employees. Accordingly, the company needs a thorough restructuring that would go a long way in changing the perception of new employees. Additionally, a change in organization culture would suffice, particularly towards a more inclusive society that embraces teamwork and innovation. Although the managers’ coalition has been existent for some time now, it is possible to eliminate its powers through the necessary restructuring efforts (Eichenwald).