Gates Lays Out Strategy for Building Better Business Software

Microsoft believes it has figured out what kind of software midsize companies need to run their finance, sales, and other operations. And it's not what it's been trying to sell them. So today, it laid out a change of strategy for its 5-year-old business-software division.

The new direction, around which it has pinned large hopes for future growth, centers on a simple but so far elusive idea: Different kinds of workers in a company use PCs differently. At an event on the company's Redmond, Wash., campus today, Microsoft officials planned to detail the new approach for its $800-million-a-year Business Solutions group. The concept is that applications should be tailored to an employee's role in a company.

Microsoft chairman and chief software architect Bill Gates said the company is investing in midmarket apps--where it lost more than $200 million last year--for the long term. "Applications can be way better than they are today," Gates said in an interview with InformationWeek. "We are putting a lot of R&D dollars into the business, and that's because we believe it can be a much bigger business. We can have a much higher share of the business than we have today."

After two years of market research, Microsoft managers have identified more than 50 everyday job roles at midsize companies they say will benefit from desktop environments created just for them--everything from a president or CFO, to account managers in a sales department, to line workers on a factory floor. Instead of dozens of screens and menus, those workers will get Web pages that show only the information they are most likely to care about, often at a glance. Companies will be able to customize those entry points into Microsoft's applications, too. Microsoft plans to deliver two dozen of these role-based applications this fall as part of upgrades to its Great Plains enterprise-resource-planning line and to its customer-relationship-management package. Next year, it plans to roll out 25 more for its Axapta and Navision business applications.

The new software spans a broad array of job titles that extends well beyond IT and operations managers that tend to run ERP software. It's a reflection of new workplace realities in which PC data gets consumed by nearly all workers. It's also an effort to catch Microsoft up to its toughest competitors in the business-apps market, Oracle and SAP.