And the fourth is the autonomy aspect, where they can determine how and where to do the work. When you have people who feel they are doing meaningful work, have confidence, and are making an impact, this increases accountability to the organization. These are all critical starting points for technology introduction and change, and I’d love to see your perspective on this, given your unique position at Microsoft. We begin by looking at the importance of culture. MP: If employees understand the benefits of any type of change, it’s much easier to get them on board. Ultimately, frustrations that surface often result from a conflict with the culture. Sign up for membership to become a founding member and help shape HuffPost's next chapter. MP: I think one best practice that you see great companies using is with this empowerment approach is that they trust that employees will know their own energy levels better. If I own a Microsoft PC but buy an iPhone, I'm more likely to buy an iPad over a Windows 8 tablet, and eventually, when it's time to buy a new laptop or desktop (assuming I don't just use a tablet instead), I'm also more at risk of leaving Windows to go with a Mac. With Satya Nadella now at the wheel, it's clear that Microsoft is looking for a new direction. You can’t delegate it. Microsoft Teams has taken these thoughts into account, rather than just churning out sets of features without purpose. of course, the fact that it hasn't yet figured out how to gain a foothold in the mobile market. Over the past few years Microsoft has seen its influence waning, and it's also made a number of key mistakes. Microsoft just beat and raised. But if people are using technology without a strong culture supporting it, then you’re not going to see those benefits. Transformation is hard. When a person accepts that they don’t innately know everything, they eradicate their limitations. What’s the impact and connection between technology, culture, and how people actually do their best work? I spent some time discussing the importance of culture with Dr. Michael Parke from the London Business School, with a particular focus on the important role that organisational leaders have in getting the best out of their employees. I ditched corporate America in 1994 and started a management consulting and venture capital firm (http://petercohan.com). For example, integrity – what does that mean? Additionally, its Surface tablet has only been able to garner less than 3 percent of the tablet market. Dr Michael Parke, Assistant Professor of Organisational Behaviour, LBS Some cultures — those that attract and motivate the most talented people to create world-beating products and deliver excellent customer service — promote growth. The main challenge, given the new markets and new products and business model, was how to grow and to scale and how to transform while [continuing to] perform," he said. One other point I’d like to bring up, is the hiring process. Its product pricing continues to be out of step with consumers, as it's overpriced several key products -- Xbox One, Surface, Windows Phone and Office -- and then had to slash prices later. It isn’t just strength and endurance, or how hard you can push, or how long you can run for. As he explained, “We had to introduce and to promote new products and business models ([software as a service] vs. perpetual [licenses]). You are the champions of overcoming constraints.”. 3 Arrivals on November 07, 2019 in New York City. Another problem for Microsoft is that its ecosystem isn't standing up to the competition. Is this technology going to create a strong desire to use it because it has multiple benefits to our work? Our research findings have shown that without fostering the right culture, transformation will never truly be successful. Microsoft also needs to stop pushing the Windows 8 metro-tile interface as a universal solution for its mobile devices, laptops and PCs. Ultimately, you’re empowering them and trusting them that they’ll do what’s right for them, and for the company. It’s from this growth mindset spirit, that the seed for this Outside Perspective series was planted. MvdB: Reflecting on our own transformation at Microsoft and that of the customers I talk to, I find that every company, given their context, their culture, and their history, is very different. Microsoft has to find a way to incentivize developers. If employees are investing their full efforts, they’re engaged. They enjoy it, and they’re fully concentrated, which means you’re going to get better results. If Microsoft could offer deep discounts on smartphones and tablets on a par with Google and Amazon, they will gain traction in the marketplace. How Microsoft Changed Its Culture by Going Simple By Chris Weller , Mary Slaughter February 7th, 2019. What does it do about bringing out the best work in people? Transparency is a good example. Court filings, internal documents and interviews with employees illustrate why Microsoft has failed to hire or retain more women: Widespread complaints focus on a culture … Is it highly visible, so that it gets used? The new culture answered for everyone in the company — of different ages and from different countries — 'Why are we here?'". Thus, the domain content of what culture is, what it means, and what the values are is changing. Good organisations bring awareness to the different ways that people work, before coming to a collective agreement with their employees about how new technology, like Teams, can work for everyone going forward. At the present time, Microsoft's mobile market share amounts to just 3.5 percent. Microsoft not only had to improve the way it interacted with customers but also how it created "new products and services to existing customers. It’s about constantly improving and challenging ourselves. As I wrote in Disciplined Growth Strategies, culture is turning specific values into criteria for hiring, promoting, and firing people. Microsoft has tried to overcome this by buying Nokia and producing its own branded tablet, the Surface, but in so doing it's run the risk of alienating its tablet partners, and, as a result, the Surface has always been priced considerably higher than third-party Windows 8 tablets. For example, Microsoft’s price-earnings-to-growth (PEG) ratio is 2.22 — based on a twelve months’ trailing PE of 32.4 on earnings expected to grow at a 14.6% rate over the next five years, according to YahooFinance. Microsoft has to stop taking the premium-model approach with many of its products -- phones, tablets, laptops, Xbox. 26 April, 2018 By At Microsoft, the term ‘growth mindset’ isn’t a hollow buzzword that’s hung on the wall. For instance, the company waited almost three and a half years after the first iPhone debuted before launching its own modern smartphone operating system, Windows Phone 7 (which failed miserably); it took two years to launch its first tablet after the iPad; it went all in with a new operating system for PCs as well as mobile, Windows 8, which uses a metro-tile interface that is best used with a touchscreen device, not a standard mouse and keyboard, as most consumers have; its latest iteration of the Xbox game console was positioned as an all-in-one entertainment unit for the living room instead of as a pure gaming device, was priced $100 higher than the PlayStation 4 and required a $60-per-year membership fee just to be able to use Netflix, Hulu and other apps; etc. Speaking to CEOs around the world, it’s clear that transformation isn’t just about technology, but also about how people can change their companies. Nir Tenzer, who until July 2019 was CEO of cybersecurity firm, nsKnox Technologies, worked for Microsoft from 2006 to 2017. I study how to engage employees to bring the best out of them, and how to foster effective collaboration and teams. Is it about having a growth mindset? About 53 percent of Apple's revenues last quarter came from iPhone sales. Leadership is also crucial. They know when they’re getting tired, and as long as they’re doing good work, those companies are happy to provide the opportunity to work from home, to do half-days, to have break rooms or workout rooms, or cafeterias and even psychologists or professional coaches to help build effective work and recovery habits. MvdB: For me, at Microsoft, I feel that the empowerment is leading to people feeling more accountable. But there's also another reason that this is important: Having a strong mobile arm is important for keeping consumers within a brand's ecosystem. It also means that they have confidence in their abilities to perform their work. Opinions expressed by Forbes Contributors are their own. Not only are they implementing the values that they care about and the expectations that are important to them personally, but leaders are also directly in the spotlight, and people look at them to understand what an organisation is all about and what it sanctions. For instance, autonomy means employees have the freedom to determine where they complete their work as long as they meet the performance standards, but this cultural value of autonomy may cause coordination issues at times, so how can the organization protect against those side-effects? Again, a better pricing strategy is what's needed most of all.