The Rise of the Phoenix? How Microsoft’s Cloud Strategy Is Helping the Company?

A company ridiculed in the past for it’s inferior product quality and mis-forays in the consumer mobility space, just became the most valuable company in US, leaving behind Apple, Amazon and Alphabet. This is the testament of Microsoft’s cloud strategy. With 753.3 billion in market capitalisation Microsoft has upset Apple after 2010. While there will be millions of small decisions and actions which contributed to this – and of course some missteps from Apple as well, one reason stands out.

Microsoft has always been a force to recon with. The entierprises were dependent on Windows and Office, and all other challengers were far behind it in the competition. Somewhere, this might have made Microsoft a bit complacent and arrogant, as was perceived by many earlier. Steve Balmer’s style of functioning did not help much in altering this perception, it may have actually fueled it.

Microsoft enjoyed this till iPhone. With iPhone, Steve Jobs changed the technology landscape altogether. The consumer for the first time was in position of command over the technology. It put Apple to the top of business world and rightly so.

iPhoen success fuelled the race in the consumer mobility space. While iPhone became the status symbol, Google tried to take the cost advantage.  And both were succesful. Microsoft was left behind. In fact, after the release of iPad many feared and predicted the demise of PCs, and eventually Microsoft, since most of Microsoft was depentent on Windows at that point installed on PCs. And it seems that with iPhone, adoption of Macbooks also increased and has become far more visible than it was a few years before. All this was bound to create unrest for Microsoft.

Microsoft’s response was chaotic, sometimes laughable and disastrous. It’s attempt to take on Apple and Google on the turf where they had already planted their feet firmly made it weaker. The fact was that despite success of Xbox, Microsoft was still an enterprise company at heart, it never had that consumer mindset. It’s not that they didn’t try. It’s “Flat” design philosophy even forced Apple to move away from skeuomorphism. Acquisition of Nokia was also strategically good move. For brief moments, with every new move it ignited hopes, only to be dashed later.

We also should not forget the efforts behind the search engine, Bing. It tried to take on Google in the search. In doing that, it tried to take on two giants, Apple & Google, who were playing to their own strengths, in areas which were not in the DNA of Microsoft. And it of course failed in that.

Once Satya Nadella took over though, seems Microsoft decided to go back to their roots. They seem to have adopted an approach which plays to their strenghts, which is the enterprise arena. The biggest vehicle for Microsoft’s growth in recent years has been Cloud Services. All other growth services have enterprise hues. Even the success of Surface tablets can be largely attributed to enterprise users and professionals. Barring Xbox, Microsoft’s revival is due to playing to it’s stength in Enterprise sector.

And it has not only been about business success. Microsoft’s reputation has positively grown. Building the future on your strengths helps you grow even against all odds. Yes, there will be setbacks, but your strengths again are best chance for you to get out of those. Rather than running around the illusive targets because somebody else has been succesful there without giving a thought about your own individuality will spread you thin and much less effective. This is true for individuals, and this is true for organizations.

P.S: Apple’s woes seem to be result of lower demands of iPhone XR,a relatively cost-effective model. Is it another indication that not playing to your strengths can harm you?