Microsoft repositions as ‘the productivity and platform company for the mobile and cloud-first world’

Microsoft is looking to transform itself from the “devices and services” business it has been positioning the company as in previous months to “the productivity and platform company for the mobile-first and cloud-first world”.

Satya Nadella Microsoft CEO
Microsoft CEO Satya Nadella addressing staff at the company’s headquarters.

In a rallying email to staff, Satya Nadella, who became Microsoft’s chief executive in February this year, outlined the next stage of the company’s transformation under his leadership.

It is hoped the new approach will drive a turnaround in Microsoft’s fortunes, a company that has lost more than 35 per cent of its stock value since the year 2000, having failed to keep up with competition form the likes of Apple, Sony and Google.

Microsoft has been describing itself as a “devices and services” business ever since 2012 when former CEO Steve Ballmer announced the company’s overarching “One Microsoft” transformation strategy and a major restructure designed to ensure its products and services were marketed and designed in a more joined-up fashion. 

However, Nadella says that while the devices and services descriptor was useful in starting the company’s transformation one year ago, Microsoft now needs to “hone in” in on its “unique” strategy.

He adds: “At our core Microsoft is the productivity and platform company for the mobile-first and cloud-first world. We will reinvent productivity to empower every person and every organisation on the planet to do more and achieve more.”

Microsoft Core 2014
Picture: How Microsoft describes its core.

Going forward, Microsoft will consider every user as a “dual user” – people who use technology for work or school, but also in their personal life. Nadella says the company will also work harder to ensure Microsoft experiences become more connected to each other.

Using Microsoft’s Siri-like personal assistant app Cortana as an example of this approach, Nadella says: “Increasingly all experiences become more connected to each other. In the future, Cortana will be even more intelligent as a personal assistant who takes notes, books meetings and understands if my question about the weather is to determine my clothes for the day or is intended to start a complex task like booking a family vacation.”

As Nadella has previously outlined, Microsoft’s Cloud OS – in particular its Azure cloud platform – represents the company’s largest opportunity for growth. He also adds that Microsoft will look to make investments in Windows to ensure it becomes the “most secure, manageable and capable OS for the needs of a modern workforce and IT” and that the company will continue to innovate and grow its Xbox fan base, which it hopes will create additive business value. 

To prepare itself for transformation, Nadella says Microsoft’s culture must innovate too, which will include major engineering and organisational changes. Further details on those will be announced on 22 July when Microsoft reports its latest quarterly results.

He ends his email by saying: “With the courage to transform individually, we will collectively transform this company and seize the great opportunity ahead.”