Can Microsoft be Relevant Again?

While Microsoft’s new CEO seems to be doing great things, many are still writing about how MSFT is no longer relevant.

This discussion led me to devote my shower today to the theme “Can Microsoft save itself from MSFT?”. My initial answer is yes. In my opinion they need to do 2 things.

The first thing they need to do is become a solutions company and not a product company. The second is to bring innovation from the outside into Microsoft.

Nadella is going in the right direction by making it easy to have Windows on all platforms, but he is still thinking of MSFT as a products company. That way of thinking is dead. Customers today want solutions not products. A number of giants have made a successful jump from products to solutions. IBM would be the poster boy for this trend. HP has also done immense steps in that direction. A good example for a smaller company is Amdocs (DOX) the telecom billing company who know will sell carriers any solution they need.

Microsoft must reinvent themselves as a solutions company. I think they have the base to do it. The second thing they need to do is bring innovation in from the outside world. Not easy for a giant corporation. How would I do this? Budget $100m a year for five years to a separate Innovation Company that would operate independently. This company will establish 20 accelerators around the world. Accelerators will be established not only in obvious places like San Francisco, New York and Tel Aviv, but also in Cambodia, Brazil and Nigeria among others. If done right with the appropriate people and guidance, in five years Microsoft can be a new company! Am I dreaming? what do you think?