Interesting article in NYT on vacation policy at IBM .... apparently they are doing away with formal time reporting and instead managing the whole away from work thing informally. I can definitely see pros and cons here. Reporting time off is at best an art for information workers that end up working late or on weekends, so is taking Friday off really a vacation day? But at the same time, I actually think it's in companies interest to enforce time off for employees. With this kind of model, I can easily see things spiraling out of control unless management leads by example.

I am still shocked by the number of people that tell me they have not taken a holiday for 2-3 years. Are you crazy .... NO ONE is that indispensable, and if you are, your management has not done a good at job at succession planning and business continuity.  Take time off, relax and get jazzed up for another round. It's good for you and ultimately your employer.

Link to At I.B.M., a Vacation Anytime, or Maybe None - New York Times

Another "social network" joins the fray. Today I got an email from Nielsen announcing the launch of Hey! Nielsen, a web-based social networking site that will allow consumers to share their opinions about all aspects of entertainment. The public “beta” for the site is scheduled to launch on September 24th as it's currently restricted to just employees.

Social networking is well on it's way to becoming a must have feature of any trafficked website. This provides a great opportunity for platform providers (do these websites really know how or want to build the infrastructure from scratch) but different response models for existing horizontal sites. Some will pursue aggregation, others will ignore. It will be interesting to see over the next year how these adapt and whether it will lead to a fragmentation of social networking, at least as we know it today.

Link to Hey Nielsen!

Working at Microsoft, I always feel like the guy that doesn't have enough devices and new gadgets to play with. Luckily in my new role, I get to play with a whole bunch of new gadgets! I wanted to talk about a few that I find incredibly useful ... many of these have been talked about before.

The first is the phone on left hand side below. Your company needs to have Office Communications Server 2007 and you need to be enabled on it. After that, you can take it anywhere (yes, anywhere) and just plug it into an ethernet connection. After that it connects to your enterprise, upgrades itself to the latest software and allows you to log in (either using the touchscreen display or your finger print) to a lightweight version of Office Communicator 2007. Now it's your office phone, with access to the corporate directory and one touch calling. The sound quality is awesome as it uses the latest codecs built as part of our media stack for Office Communications Server. It makes working from home so easy.

The second is the device on the right. I now take this whenever I am traveling. The dongle plugs into your laptop and detects Office Communicator 2007 on your machine. To make a call, simply dial the number on Communicator and the dongle transmits using Bluetooth to your headset. Now you have a "phone" that you can wonder around the room with and still have a great high quality audio conversation. The talk time is about 6 hours on the headset which is pretty amazing. I would love to see voice recognition in this device down the road for an even better utility factor.

While I love these devices, what I love the most are the possibilities. The software centric approach to voice that Microsoft is taking really allows us to innovate on devices for a particular need that integrate seamlessly into a common business process application and the likes of Texas Instruments, AudioCodes, Dialogic, LG Nortel and Polycom have already licensed the RT Audio Codec to develop these devices. Expect me to have many more devices to play with over the coming months.

At VoiceCon San Francisco last week, there was a lot of talk about video conferencing so it was interesting to see the article below in The Economist continue to fuel the hype. I attended a couple of sessions where the main proponents of large scale telepresence systems were either expensive hardware makers or bandwidth and data network equipment providers, so I had to take everything with a grain of salt. That said, video conferencing is clearly an underutilized communication mechanism today and there is ample room for both innovation and market growth.

Far away yet strangely personal

Aug 23rd 2007 | SAN FRANCISCO
From The Economist print edition

The despised business of videoconferencing is about to get a new lease on life ....

Videoconferencing was supposed to put an end to corporate travel. But positioning people in front of a camera, fiddling endlessly with controls and then either giving up or proceeding to stare at a tiny picture of a blurry face often seems less satisfactory than the humble telephone. Such “conversations” are often a sequence of time-delayed interruptions and missed social signals. Just as the technologies that were supposed to deliver “the paperless office” actually deluged it in print-outs, videoconferencing sometimes works so badly that it leaves users feeling alienated, and so keener to meet face-to-face than they had been in the first place, say Andrew Davis and Ira Weinstein at Wainhouse Research, a consultancy .......

Consumer "video calling" is a very compelling proposition. I regularly use it using Windows Live Messenger to keep in touch with my folks back in the UK so they can see the latest shenanigans of their grandson. The teary look of happiness on my Mums face demonstrates the power of this technology in serving a basic human need .... people communicating face to face. There is no doubt that we communicate with facial expressions and that video conferencing helps foster this in a fragmented world. But the truth is that I arrange to have a video call. I am not comfortable talking to anyone on video and I find it difficult to multi task (as many of the Millennial generation do) while on video. I am just not sure that individuals are culturally ready to embrace video conferencing en masse.

One of the stated benefits of video conferencing is reducing travel and the benefits may well be huge. If a large company spends $12,000 per employee per year on travel and 50% of employees travel, for a 50,000 person company that amounts to $300 million per year! Reducing even some of this cost can easily justify costs ... but only if you can realize them. But therein lies the problem. Will you just end up using video conferencing for those meetings where employees wouldn't have traveled anyway. Worse still, will the initial interest in the systems die down and they sit around gathering dust. If you purchase expensive systems for the CXO suite, as this article refers to, do you end up cutting travel for the 10 least price sensitive people in your company. There are just too many unknown factors to make a call on pure cost savings.

So where could you find the answer? I think you have to look at more than just cost savings, although that is certainly a factor. First, I think you have to make video conferencing plug-and-play simple to use for anyone. The barriers must be low so that people use it more and more, become comfortable with and eventually do use it to replace travel. That may not happen initially, but an easy to use device can help change culture. Second, I think you need to offer different tiers of experiences, that help the users feel like "they are there". Big expensive systems could do that, but then you really don't get that much in savings as it is not available for the average employee. It needs to balance quality of experience with cost. Finally, being able to do things like record integrated meeting sessions incorporating presentations, audio and video help make video conferencing more of a reality.

One product that Microsoft is introducing with Office Communications Server 2007 and Office Communicator 2007 is Microsoft RoundTable. It's an eyecatching device that a user simply plugs into their laptop and can start instantly using with Communicator or Live Meeting. The device captures a panoramic view of the meeting room and detects the active speaker to focus in on them. The experience is really very very simple, and yet really powerful. At less than $5,000 (final price available soon), it is easily affordable compared to other telepresence units and offers a good step up compared to web cams for minimal price increase. RoundTable also allows you to record meetings for training purposes. Click on the image below for a great review on the device.

I think there is a lot more to come both in innovation around immersive high quality video conferencing technology to make business travel less necessary, and integration with business processes or communication tools to make it more relevant. But I don't think the answer to realizing benefits of video conferencing, partly driven by adoption by a critical mass of users, lies in a limited number of high cost units. It has to be about making it widely available and usable. That said, telepresence has a role to play in demonstrating the technology and I look forward to seeing more advances there.

When I was in the UK, people bought bottled water that was from "natural springs" and was labeled "bottled at source". It was good to have the original nutrients and substances at the springs left in. I'm not sure what the trend is now in Europe, but it's funny how bottled water in the USA is marketed as having all these substances removed!

Pepsi's Aquafina will soon carry the words “public water source”, instead of simply the innocent looking “P.W.S.”. How much do we pay for tap water again?

This week marks my fourth year at Microsoft and time continues to fly by! I saw some big changes in our organization, learned a lot about the broader Microsoft machine, made a move from the consumer to business side of Microsoft and tried to figure out the whole work life balance thing.

At the start of the year, the team was reorganized under Steven Sinofsky heading up the "front end" for Windows and Windows Live; Blake Irving (who left recently) heading up the "back end"; and Steve Berkowitz heading up the "business". We had Martin Taylor, the Corporate Vice President in my reporting line summarily depart at the start of the year, leaving a void for many of us. Mark Young, who had headed up Marketing departed mid year and many in his team were absorbed into ours. Brian Hall took the reigns for Windows Live Consumer business soon after that and continued some minor reorgs to align the team to the evolving strategy. And I dare say it's not over yet. Throughout this, I was fortunate to have had the same manager for the entire year, a first at Microsoft for me! And for the most part, my engineering counterparts have remained the same too.

The organizational changes reinforced two key learnings for me. First, reorgs are a matter of fact at Microsoft. Many always intend to keep things constant so that teams can learn to work together, but it just never happens. To survive, let alone succeed, in Microsoft you have to be comfortable with the ambiguity that reorgs bring. Second, the new people being brought into the leadership of Windows Live are usually "company men" (and an occasional woman) who have largely grown up in the Office, Windows, Server or Sales/Field Marketing org. For most of my time at Windows Live/MSN, we have been pretty isolated from the rest of the broader Microsoft business. That is clearly changing as more and more traditional Microsoft leaders are stepping in. This has some implications on the vibe within Windows Live as well as the ties to the rest of the company. The vibe is much more "productivity" focused and there is less of the opportunistic tapping into consumer trends. We are also much more closely involved with the online services and marketing strategy in other divisions. These aren't necessarily bad things, in fact, the potential for Microsoft when we act in unison is incredible. It's just very very different.

It also emphasizes for me how important it is to get to know the "other side" of Microsoft. If you want to stay in the company I am realizing you have to deeply understand the business strategy and processes for the "core business". Even if you don't stay in Microsoft, it's important to understand the process by which Microsoft goes to market and develops enterprise products, as that is such a key strength for the company. That has been the motivator for my move into the Unified Communications Group, one of the most exciting areas (for me at least) of our core business growth opportunities.

My team changed a lot throughout the year too. I started off with just Ali and Heejin, but added Analisa, Niranjan, Pooja, Joost, Charlotte, Chris, Mary, Marty, Jay and of course Arik, Ashley and Arthur. Heejin, Analisa and Niranjan left the company for various reasons. It was hard to maintain a team environment through these changes but we managed to stick together and have some fun. My new team is smaller and more technical, but very strong in their areas which I am psyched about. I hope through the year I can get to know them as well.

The year started for Spaces with or inclusion in Rockstar SuperNova where Brooke Burke mentioned Windows Live Spaces on several of the shows. But we saw some issues with performance as the scale of Spaces grew. The team has been very focused on making performance better and we have seen substantial improvements around the world. We hit a high of 150M unique monthly visitors which is phenomenal but we fell short of our expectations. I learned a lot about how dependencies are managed by more experienced Microsofties in my leadership chain.

Meanwhile, the company continues to deliver some pretty breathtaking results. Our FY07 revenues were $51 billion, that's 15% growth! We returned some $31 billion in cash (175% of operating cash flow) to shareholders. But our stock price has fallen from around $29.50 to $28.50 in the couple of months since that announcement. It's interesting that share buy backs and dividends are the two big factors that improve our stock price as opposed to the underlying growth story of the business. Steve Ballmer recently talked about our long term investment horizon and I truly applaud that. The tech industry is generating some transformations that could take a decade or more to bear fruit, and the players with the tenacity to see it through will be able to take a slice of that pie. It is shame that the markets don't have ten year DCF forecast models and may never reward us for that thinking. I still wonder if we would be better off with a more leveraged structure or as a private company.

On the personal side, I am loving family life in the Northwest and even Lisa (the die hard New Yorker) is now a Northwest fan. It would take a lot for us to leave the lifestyle we have here. Armaan is now 17 months old and is a bundle of fun, absorbing everything like a sponge. He starts in a new school next month that we are very excited about. Lisa and I have a work schedule that allows us both to spend a good chunk of time with Armaan every day and all weekend and I can honestly say that life feels pretty full. I don't know what the next year will bring, but I am looking forward to it!

Every year, Gartner evaluates the various players in the unified communications market and ranks them in a grid showing ability to execute and completeness of vision (definitions below). This year Microsoft actually moved in to the top of the Leader quadrant and Cisco moved down to the Challenger quadrant. This is a great endorsement of a software centric approach to solving the issues faced in unified communications.

Evaluation Criteria Definitions

Ability to Execute

Product/Service: Core goods and services offered by the vendor that compete in/serve the defined market. This includes current product/service capabilities, quality, feature sets, skills, and so on, whether offered natively or through OEM agreements/partnerships as defined in the market definition and detailed in the subcriteria.Overall Viability (Business Unit, Financial, Strategy, Organization): Viability includes an assessment of the overall organization's financial health, the financial and practical success of the business unit, and the likelihood of the individual business unit to continue investing in the product, to continue offering the product and to advance the state of the art within the organization's portfolio of products.Sales Execution/Pricing: The vendor’s capabilities in all pre-sales activities and the structure that supports them. This includes deal management, pricing and negotiation, pre-sales support and the overall effectiveness of the sales channel.Market Responsiveness and Track Record: Ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the vendor's history of responsiveness.Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the organization's message to influence the market, promote the brand and business, increase awareness of the products, and establish a positive identification with the product/brand and organization in the minds of buyers. This "mind share" can be driven by a combination of publicity, promotional, thought leadership, word-of-mouth and sales activities.Customer Experience: Relationships, products and services/programs that enable clients to be successful with the products evaluated. Specifically, this includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups, service-level agreements, and so onOperations: The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure including skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.

Completeness of Vision

Market Understanding: Ability of the vendor to understand buyers' wants and needs and to translate those into products and services. Vendors that show the highest degree of vision listen and understand buyers' wants and needs, and can shape or enhance those with their added vision.Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout the organization and externalized through the Web site, advertising, customer programs and positioning statements. Sales Strategy: The strategy for selling product that uses the appropriate network of direct and indirect sales, marketing, service and communication affiliates that extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base. Offering (Product) Strategy: The vendor's approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature set as they map to current and future requirements. Business Model: The soundness and logic of the vendor's underlying business proposition. Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including verticals. Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, defensive or pre-emptive purposes. Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the "home" or native geography, either directly or through partners, channels and subsidiaries as appropriate for that geography and market.