Bill Gates’s Road to Success
Bill Gates is a well-known leader in the business world. His company’s inventions impacted the business world and changed the market. Bill Gates had a vision of what other executives only dream about. His values and strategies have managed to keep Microsoft on the edge of technology. Still, many questions have risen about Bill’s strategies on whether or not his harsh marketing depicts a monopolistic nature or is simply a result of becoming the leader of the technology industry. Bill’s inventions that changed the business world
Bill Gates and his Harvard pal, Paul Allen, became inspired by seeing the first MITS Altair 8800, which was on the cover of Popular Electronics in 1975 (Gates, 2007). Bill and Paul wrote their version of the existing BASIC programming language for the Altair (McCraw, 2000). Since they realized that they would have to move quickly, they marketed their programming language to the firm who made Altair, MITS. During this time, Paul Allen joined MITS and when the company failed to prosper, he joined as a partner with Gates at what became known as Microsoft (Gates, 2007).
Bill Gates’s Road to Success Essay Example
Microsoft was gaining market share in the U. S. , but its biggest break came from Japan. Bill knew back then that the global impact of the pc industry would be an important part of Microsoft and decided that he couldn’t do this all on his own. So, in 1980, he enlisted the help of another Harvard pal, Steve Ballmer (Gates, 1995). It was also during this period, that Microsoft reorganized into a private corporation with Gates as President/CEO and Paul as Executive Vice President (Gates, 2007).
In the earlier days of Microsoft, the strategy was to buy software licenses for the computers they sold and then re-sell the licenses with the software to other companies, such as Radio Shack (Gates, 1995). Microsoft would then receive a royalty generated from such sales. This was done to offset their low sales from those who stole the software and sold it for a profit. Over the years, Bill feared that other microprocessor chips or software companies would grab the market outright. So Microsoft began licensing their software at lower prices.
The company’s vision was that it should be a “no brainer” for their customers (Gates, 1995). This strategy became a fast success as every personal computer was licensed with Microsoft’s BASIC language. At this time, Microsoft became an industry standard. The company succeeded because of its compatibility. Compatibility is what gives businesses that “x” factor that sets it apart from the other competitors. As a result, consumers openly welcomed Microsoft into their homes because the more compatible their products were, the more valuable they were to its buyer (Gates, 1995).
The methodology worked because it was supported by the marketplace and exists as a result of the positive spiral that precedes success (Gates, 1995). By 1991, Microsoft’s sales became the first personal software company to exceed sales of $1. 1 billion and rolled out its multimedia encyclopedia, Encarta (Gates, 2007). Consumers no longer had to continue to purchase a large book every time it was updated. But it all came to a halt when the Justice Department alleged that it violated a 1994 decree regarding licensing of the windows operating system to computer manufacturers (Gates, 2007).
In the coming years, some of the company’s other accomplishments would include MS Office 2000, Internet Explorer, Microsoft Net, and X-box (Gates, 2007). The most notable invention for Microsoft was the pc card. The card was as thin as a wallet with the memory capacity of a pc. The card incorporated chip technology and allowed users to make purchases, pay bills, and perform inquiries on bank accounts, while holding all medical histories. This made it easy when consumers visited numerous doctors, who maintained separate medical records.
When a patient visits the doctor, before leaving, their updated history is loaded onto the card with a reader machine. Paperwork and files are a distant memory of what technology once was. Banks no longer have to mail statements to its members and consumers do not have to carry around unnecessary cash. All of these inventions changed our work habits, allowed our pc’s to share information with each other, and revolutionized the pc industry. E-mail allowed us to communicate across the country and the world.
Businesses who had no way to communicate globally with its customers and suppliers, other than the telephone, now had more choices. Meetings could be done with videoconferencing over great distances. These inventions also allowed improved product support. Developers could diagnose problems onscreen, without invading the consumer’s privacy. The pc card propelled Microsoft into sales of $1 trillion and ensured that no Gates family member would ever have to work. Microsoft’s Partnership with IBM In the 1980’s, Microsoft was approached by IBM, who had recently introduced its own pc and quickly became the industry leader.
IBM’s management decided to outsource its disk operating system and microprocessor (McCraw, 2000). Intel was another company who IBM outsourced to, besides Microsoft. As a result, Microsoft leapt into this partnership and was able to offer faster delivery with lower prices, compared to IBM. This move crippled IBM’s infrastructure, but transformed Microsoft. Initially, Microsoft’s goal was to earn a profit from licensing MS-DOS to computer companies who wanted to offer their customers with more or less compatibility to the IBM pc.
Many had thought that IBM made an incredible mistake by outsourcing, but IBM was able to recharge the pc industry with an abundance of technological skills and energy. Microsoft’s Strategy and Management When Bill started Microsoft, he never anticipated that Microsoft would grow so large. But from the earliest days, his goal has been to prove that a successful corporation can renew itself and stay in the forefront of its industry (Gates, 1995). Bill was also a believer that we should work smarter not harder. His inventions improved productivity and increased the form of communication.
His strategies mimic those of Frederick Taylor. Taylor’s philosophy also was one to emphasize maximum output, while reducing the effort, so that maximum production is achieved (Net MBA). Bill Gates is known to be a humble and flexible CEO. So when the internet boom hit, he directed Microsoft towards other projects. Luckily, it was one of his employees who reminded him that Microsoft could be out of business, unless he listened to the success others were having (Krames, 2003). None of this would have been possible without the hierarchy Gates created. The bottom up communication enabled ideas to be fostered by everyone.
Gates believed that if he empowered his workers, they could use it to their advantage. Bill knew that if a business refused to listen, to those closest to its inner operations, it could miss out on critical opportunities. Gates was also a believer of holding company retreats as a way of focusing on key topics and helping manage regain focus on its intended course (Krames, 2003). The benefit of these retreats was that it removed the employees from the business environment and placed them in a serene place where they could collaborate on company ideals.
As with any business, management has a challenge to become a change leader. A change leader is someone who sees change as an opportunity, looks for a change, and knows how to make it effective inside and outside of an organization (Drucker, 1999). Bill Gates would seem to be that of a change leader. Although, a change leader has to be able to look for and anticipate change, while balancing continuity (Drucker, 1999). Distractions can make an organization believe innovation makes it into a change leader, which is where Microsoft now sits.
Clearly defined, a change leader is someone who can make the organization see change as an opportunity (Drucker, 1999). Businesses who are looking for innovative ways to increase market share should evaluate their success and failures, along with their competitors, while acknowledging any changes in the industry, market, demographics, and perception by creating a Window of Opportunity (Drucker, 1999). Businesses should determine if there is an opportunity to innovate and if it is in line with their strategic goals. Then, pilot their moves in the right direction by analyzing market and consumer research.
By following these change factors, Microsoft has a way to proceed ahead and regain the strength, it once had. Bill is a true believer that the most important factor in innovation is our workforce (Gates, 2007). After all, the world’s best scientists and engineers were able to create the microprocessor. Until other companies and countries begin to realize the importance of innovation, it is crucial that our future workforce be properly educated in math, science, and problem-solving skills. Education is the key to remaining competitive in a global economy (Gates, 2007).
Gates also believed that companies must act as advocates to increase education standards and ensure that it is relative to the needs of our business environment (Gates, 2007). Lessons Microsoft learned the hard way Microsoft’s rapid success has a way of making others think that they are invincible. Over time, strategies that have been successful before, no longer work. In an instant, people, technology, and the course of business can quickly change direction. In 1998, a well-known scientiest, Kai-Fu-Lee, from Silicon Graphics, came onboard Microsoft (Greene, Hamm, Brady, & Der Hovanesian, 2005).
This strategic move was seen as monopolizing pc operations by taking on the world’s brightest computer scientists. However, Lee bolted to Google (Greene, Hamm, Brady, & Der Hovanesian, 2005). Microsoft was known to intentionally hire managers from failing companies (Gates, 1995). This move was to staff the company with those who have been able to overcome tough situations. Any business would want to ensure that employees contain the right level of experience. However, Microsoft continued to lose some of its best scientists, marketers, and programmers to E-bay, Skype, and Google (Greene, Hamm, Brady, & Der Hovanesian, 2005).
Microsoft’s employees had criticized the company for cuts in compensation, profits, and lack of increase in its stock price, of which hasn’t increased in the last 3 years (Greene, Hamm, Brady, & Der Hovanesian, 2005). Microsoft’s troubles were now directed towards Steve Ballmer, who was given the CEO position, while Gates pursued other interests. Since Microsoft has became an icon of American capitalism, its most lucrative monopolies, Windows and Office, may have also led to its malaise.