Microsoft's revolving small-business door revolves again

By | August 6, 2010, 6:56am PDT

It seems to be a tough job running the small/mid-size business (SMB) group at Microsoft. Even though Microsoft’s execs have made it plain that they consider the SMB segment to be key to the company’s success, no one lasts very long in the SMB chief’s chair.

The latest to depart is Birger Steen, who at the end of August will be hanging up his hat as Vice President, Worldwide Small Medium Business & Distribution. Steen is going to become president at virtualization vendor Parallels, according to a Microsoft spokesperson. Microsoft currently is searching for a replacement for Steen.

Steen held the SMB vice presidency title for a year. He was at Microsoft for eight years in total, which included stints leading Microsoft’s sales and marketing operations in Norway and Russia.

Microsoft’s official statement on Steen’s departure is from Vahe Torossian, corporate VP for SMS&P:

“Our small and mid-market business (SMB) leadership group, and specifically Birger Steen, has played an instrumental role in bridging the gap between the SMBs and technology through their leadership in the past year. Microsoft remains committed to investing in small and mid-market businesses and our partners who serve them. The list of products and offerings that we launched last year specifically for the SMBs is a great testament to the priority and focus we have with this customer segment. I am even more excited with the opportunities that cloud computing can bring to SMBs now and in the near future. We appreciate all that Birger has done and wish him well.”

Steen’s predecessor was Michael Risse, who became Vice President of SMB in 2007 and lasted until 2009.

Microsoft is expected to launch test builds in August of two new SMB-focused products, an on-premises SMB server, codenamed “SBS 7,” and a new hybrid cloud/on-premises SMB server, codenamed “Aurora.”

At Microsoft’s recent Finanacial Analyst Meeting, company officials said that 20 percent of Microsoft’s business comes from SMBs, while 36 percent comes from enterprise customers and 17 percent from consumer sales.

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Mary Jo has covered the tech industry for more than 25 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

Disclosure

Mary-Jo Foley

Freelance journalist/blogger Mary Jo Foley has nothing to disclose. WYSIWYG (what you see is what you get). I do not own Microsoft stock or stock in any of its partners or competitors. I have no business ventures that are sponsored by/funded by Microsoft or any of its partners or competitors.

Biography

Mary-Jo Foley

Mary Jo Foley has covered the tech industry for 25 years for a variety of publications, including ZDNet, eWeek and Baseline. She has kept close tabs on Microsoft strategy, products and technologies for the past 10 years. In the late 1990s, she penned the award-winning "At The Evil Empire" column for ZDNet, and more recently the Microsoft Watch blog for Ziff Davis.

Got a tip? Send her an email with your rants, rumors, tips and tattles. Confidentiality guaranteed.

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Questions remain about Aurora
Joe_Raby 6th Aug 2010
Is Aurora going to be an "infrastructure server" OS, or an "appliance server" like Windows Home Server?

Will SBS VL customers get Aurora as an upgrade right?

Is it really going to be considered to be part of the Small Business Server family? Microsoft seems to conflict themselves on a regular basis about this - sometimes it's called "Windows Small Business Server Codename Aurora", sometimes just "Windows [Server] Codename Aurora".

Lastly, how come none of the video demos show BPOS integration? Is that because they're still fleshing out their "BPOS Lite" offerings for SMB's?
SMBs have all moved to the cloud. On premise, pay up front hardware or software hasn't made business sense (for the SMB) for years. SMBs also purchase solutions not platforms. And finally, they need to hooked for free, get cash flow positive, and then upgrade to premium products, about the same time they hire real accountants, legal council, and HR. Microsoft needs a cradle to scale SaaS offering for the SMB market. They also need to reach out to this market in a new way - the Microsoft partner channel and sales force is too heavy weight for long term success in this area.
I've been in the SMB space since 1983 as a Novell VAR and then shifted over to both SMB and enterprise clients with the introduction of NT 3.0.

I've seen so many vendors, some many times, target the SMB market and I've seen a common thread in almost all of their failures. They don't get it! They don't understand any reseller, VAR, integrator, etc with less than 20 employees and they don't get small businesses under about 30. They don't understand what motivates them. They don't seem to understand what they want (which is not exactly what they are told by them).

They need to rethink how to sell to the "micro" SMB end-user and reseller. For example they need to leverage the web for ecommerce and the 1-3 person shop who doesn't have a business, they have a job (in the words of the eMyth).

They need to divide the end user market into 2 basic groups. Ten to twenty employees and twenty to fifty. They are generally severed by two different types of resellers. Those that have a job and those who have a business.

As you can tell I can go on and on, but I will stop by say that they need to put people in place who have run a small business and sold to a small business.
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