Microsoft - one of the most successful pivots of all time?

Date
May 26, 2020
Category
Research
Author
Pradyumna Nag
Reading Time
9 mins
In 2014, Microsoft was suffering.‍It looked at the business as 2 segments, licensing orhardware – based on how it felt as a division internally.

Between 2012 & 2014, they managed less than 4%

growth in their operating income.

In 2015, they decided to relook at their business inside

out.

They changed their reporting segments – to show their

renewed focus on the customer rather than their internal functions.

They embarked on a vision that covered “high-value digital work and digital life experiences” and “everyone moving to the cloud”.|

This changed everything.

Software was not for legacy sale anymore.

It was a solution that was being continually refined – a service of productivity.

Office 365 & Windows 10 were soon launched on a subscription 'service' thinking.

The vision was to envelop the digital life of every consumer – business, personal, or academic.

~200 Mn subscriptions as of 2020.

Microsoft closed 2019 with $125Bn ($87Bn in 2014) and generates 40c of cash on every $.

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