Challenge: IBM and SUN Winning Perception
As the Linux open-source operating system software was getting traction in the market place SUN Microsystems and IBM identified an opportunity to challenge the Microsoft Office franchise by "open-sourcing" the development of their respective suite of productivity software (i.e. Open Office).
The challenge for Microsoft was to clearly understand where/why/how the messaging touted on the server side which was all about "free" would impact and affect the Office franchise. The Microsoft Windows server division was building a strategy to fence off the perception of free being better than the Windows operating system. On the Office side the story of free was also resonating as the debate focused on "good enough" whereby the less full featured office suite of IBM and SUN had all that was required for the Task Worker compared to the more advanced needs of Knowledge Workers. So why pay more for the full featured Microsoft Office products when these workers don't used more than 40% of the total functionality? With Task Workers representing 60% of the Office user base the threat was significant.
Analyzing escalations requests from the field it became quickly evident that the pressure was much more prevalent with Public Sector customers than Corporate customers.
The "good enough" messaging touted by IBM and SUN was sufficiently resonating to drive the deployment of pilots with several high profile accounts (you will recall City of Munich and State of Massachusetts) and the number of pilots reported was growing exponentially.
Should Microsoft remove features and functionalities from its Office suite? React to the messaging of Free by lowering prices for certain groups of customers?
Following closely critical accounts it appeared that users in these pilots "revolted" on the utilization of inferior products. Their non familiarity with these other office suites started a user generated debate on cost versus work efficiency. The competition was starting to react, moving the debate away from "good enough" and focusing on other dimensions particularly relevant to the customer segment that had initially jumped into these pilots (Public Sector customers) leveraging a well know software marketing tactic called FUD (Fear, Uncertainty, Doubt): "Why remain completely dependent on Microsoft as their file formats are proprietary compared to the open formats of IBM and SUN?"
The debate of Open file format was on...
Understanding that the risk of losing Corporate customers to the "good enough" theory was minimal the focus of Microsoft's response to IBM and SUN should be focused on addressing the needs, fear, uncertainty and doubt of Public Sector customers.
To win over the noise level of open file formats which combined with the noise of open-source operating system software would likely require unprecedented measures on the part of Microsoft. Would there be a customer who could become an advocate of the Microsoft initiative though they had publicly taken a stance toward open source products.
Tuned to the various debates and again parsing through the increasing number of field escalations requests a rather level-headed escalation could be found with the government of Denmark. Engaging at a very deep level the strategy was developed: Microsoft needed to make its file format accessible to Public Sector entities.
The impact had to be real and while Microsoft was keeping itself very distant from associating themselves to open-source it was very clear that somehow, somewhere, the work Open had to be part of the offering.
After months of internal debate, discussions and demonstrations, on November 17, 2003, Microsoft and the Government of Denmark jointly announced the availability of the Open Documentation and Royalty Free License for Office 2003 XML Schemas.
Soon after the next critical step was undertaken to drive complete standardization of the Office file formats and further comply with government requirements.
While faced with a significant threat of being left out of the procurement of Office software to public sector customers, Microsoft regained credibility and trust among that core audience. The challenge is not yet over as the competitive pressures continue and the threat continues to be looming: Denmark recently announced saying good bye to Office file formats...