Can Microsoft's coders crank it up?

Under fire from all quarters, the pressure is on MS as never before. Can a big company move as swiftly as a startup? Read on

Question: What's the perfect size for a software development team?

Answer: The number of people you can cram inside a Volkswagen to go and get pizza.

Or so Wayne Ratliffe, one of the industry's legendary developers -- and the creator of dBase -- is reported to have once observed. Apocryphal or not, the quip underscores a widespread belief that when it comes to software development, bigger is not always better.

And thus we come to Microsoft, the biggest and baddest of them all, a company that has amassed untold wealth and power over the last 25 years, growing into a global megapower employing some 36,000 people around the world.

That very success is now being put to its most severe test as the company attempts to remake itself in the converging age of the Internet and wireless gadgetry. There's no guarantee that the past will repeat itself as the computing industry edges toward a post-PC world. And with everyone from Larry Ellison to the 19-year-old kid living next door with the ring in his nose gunning for Bill Gates' scalp, all bets are off.

The more immediate operational challenge facing Microsoft is how to retain that keen focus long after growing beyond the size of a small, entrepreneurial operation.

If management's concerned, it's not letting on. However the future turns out, the company maintains that it's in fine fettle to handle any challenge. Indeed, Microsoft just last month unveiled an ambitious Internet-centric strategy to underscore its determination to remain as relevant tomorrow as it was during the heyday of Windows-centric computing.

Perhaps only a company on this large a scale could attempt to pull off something on so grand a canvas.

Yet as Microsoft's annual developer's conference gets under way, the company has a major selling job on its hands. It must convince the faithful to believe in a message that skeptics have derided as vaporware. The Microsoft .Net initiative is a catch-all phrase describing an umbrella of technologies and products scheduled to debut over the next couple of years.

A lot can happen between now and then -- in fact, worlds can change -- as Microsoft found out when it was blindsided by the emergence of the Internet in the mid-1990s.

"You can only do software at a certain speed," cautions Microsoft chief executive Steve Ballmer. "And software development is not something you can do in six months."

That task becomes even more daunting when carried out within the confines of a multibillion dollar company where the inevitable checks and balances involved in shepherding new products to market can easily morph into stifling bureaucracy.

"My guys really felt like they were a small company," said one former Microsoft executive who asked to remain unidentified. "Where it becomes a little tougher -- and this is where Bill [Gates] and Steve will have to be great managers -- is when you require people to share other peoples' code. That's where creativity becomes an issue. Then people aren't able to be as innovative, and they come to depend on others."

It's an issue that has weighed on the minds of Microsoft management for a while. Ballmer, who made no secret of his annoyance that things had become sloppy, has been on the warpath about improving customer satisfaction. In January, Ballmer was passed the chief executive baton, freeing up Gates to function as the company's chief software czar.

A couple of months later, Microsoft announced a wide-ranging restructuring to create what the company described as separate customer-centred business groups.

Within the computer industry, Microsoft has often been dunned by rivals for turning out less-than-stellar code. To be sure, the common complaint that it takes Microsoft three tries before the company gets anything right may be an overstatement. Yet, it contains more than a grain of truth.

Former managers object to depictions that Microsoft writes mediocre code. But they acknowledge that the pressure to get to market with some kind of product -- if only to let customers know Microsoft is in the game -- leaves the company open to criticism.

"You can spend a lot of time getting something perfect," said Chris Hickman, now the co-founder of Viathan "But then you wind up missing the window."

The early incarnations of Windows, Windows NT and the Internet Explorer browser were found wanting. But one thing Microsoft does better perhaps than any software supplier is listen to its customers and fix what's broken. And in each of the previous examples, the 3.0 versions of the products either caught up or surpassed the competition.

John Underwood, the former chief executive of Sun Microsystems's Australia operations, had grudging praise for his old nemesis. He said the quality of Microsoft's code has improved over the years.

"They have been iterative in understanding the process and the needs that must be addressed," said Underwood, who now runs ClickThings, an application service provider in New York's Silicon Alley. "They had a responsibility to deliver things that work -- and it's fair to say they go to market with things as fast as they can."

But there's the rub, according to Underwood.

"They have so much code that surrounds their products that the integration of any single product means it has to be integrated into the many arms of the company -- which means they have to cross I's and T's with every department," he said. "That's a daunting task -- even for a big company like Microsoft."

That labour-intensive bureaucratic process built up over more than two decades -- which has been Microsoft's ally -- has sometimes prevented the timely delivery of products.

In the end, the pressure to keep the code heads cranked will be on the code head of them all: Microsoft co-founder Bill Gates.

Alex St John, who recalled his old employer as an innovative place, said Microsoft had designed an infrastructure to grapple with projects on a huge scale. Yet even St John, now the chief executive of Wild Tangent, a software firm based near Microsoft's Redmond headquarters, allowed that this very intricate feedback loop -- even devoid of politics and bureaucracy -- doesn't foster an environment where products get out the door in a hurry.

As a marketing director for Lotus Development back in the 1980s, Ford Cavallari emerged from his company's wars against Microsoft with a healthy respect for the opposition's development talents.

"I think the perception that Microsoft is not a terrifically good code development shop is wrong," said Cavallari, now the executive vice president of Renaissance Strategy, a Boston-based consulting firm. "I think they're one of the best, when you consider what it is that they're trying to do."

Cavallari said Microsoft's real strength is in providing the so-called enabling or middleware technologies that help third-party software developers tie their products together.

"In the old days, where there was a need to support multiple platforms, the quality side of code development was a bear," he recalled. "Microsoft came up with document object containers, promulgated VBA interfaces and made it relatively straightforward to get apps to talk to each other. That allowed ISVs to focus on customers rather than testing five or six platforms."

That particular talent tying disparate threads is now under attack. In a final decree handed down earlier this summer, US district judge Thomas Penfield Jackson ordered a breakup that would separate Microsoft's middleware operations from the Internet part of the company.

Along with the other myriad challenges it faces, the world's largest independent software company has been hurt by a brain drain. Several highly regarded senior and middle managers have left the company since the start of the year.

Former executives say that shouldn't be anything the company can't weather. But they say the pressure will be on co-founder Gates to crank it up.

"He's had an extremely tangible effect on motivation and the drive behind folks. Everyone there respects Bill," said Viathan's Hickman. "He can talk shop with any developer or tester."

That's a talent that will get pressed into service in the weeks and months to come. If Microsoft can't pick up the gauntlet this time around, the Justice department lawsuit may be the least of its problems.

Take me to the DoJ/Microsoft special.

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