Is this really the best you can do?

I mentioned in a recent post that ZUNE was a topic unto itself. Since that time, I've been keeping tabs on customer reviews and media reports including this one, which caught my attention today. In particular, this comment:

I think this is a decent first effort by Microsoft and am sure that software updates will improve the functionality of the device and Zune software, but there are a few things they could have done at launch to greatly improve the buzz around the device.

A "decent first effort" - and this from an article that's trying to restore balance given the overwhelmingly negative press to date.

Now, consider the backdrop. According to Ballmer, MSFT wanted to do a ZUNE-like product years ago but couldn't because the only executives capable of leading the charge were too busy losing money on Xbox. Let's leave aside why the "the strongest management team in MSFT's history" (as Ballmer recently referred to them), with over 900 senior managers, has to wait on 2-3 to come free in order to move forward in this area. Instead, let's cut him some slack and say it's because the competitive challenge is so formidable, the stakes so high, and the perceived solution so analogous to MSFT's gaming "success". After all, the Ipod isn't just a product, it's a cultural icon that has bested all comers to date (including MSFT and all its partners) to grab some 80-90% market share. It also comes from a company with a reputation for zealous customer loyalty, leading design/ergonomic prowess, and who has arguably forgotten more about marketing than MSFT knows. Most importantly, Apple's dominance in this area is a direct threat to MSFT's aspirations for the overall home and entertainment market, which is already large and expected to only get more so.

What approach does the creme de la creme of MSFT's "strongest ever" management team select? Why a derivative product based on the Toshiba Gigabeat (which maybe makes sense from a cost/time-to-market perspective but doesn't exactly scream "innovative"), that in some ways is better (larger screen, wireless, native FM radio), but in many ways is worse (bigger, same resolution as the smaller screen Ipod, less battery life especially with wifi active, less titles available for download, etc.), and then rush it to market before the software has apparently been fully baked, resulting in widespread reports of disappointment in the initial feature set and numerous reports of bugs/difficulty installing even that. People are actually having to write hacks just to run the device as a hard drive or on Vista - not to mention trying to get around its restrictive DRM.

So Ballmer et al have been thinking about this for several years, had their very best executives working on it heads down for presumably the past 6-12 mths at least, and this is the best they can do? And what's the result? Like the Origami before it (remember that one?), tons of advance buzz has largely given way to generally negative reviews and seemingly underwhelming sales. For example, having debuted at #5 on Amazon's list of top-selling MP3 players, the ZUNE fell to #9 by day two, and now stands at #21. What's going to happen as a result? Well, expect whatever losses had orginally been forecast, and resulting payback timeframes estimated, to get doubled as they fix the current shortcomings and then work to overcome the negative perception that's been left by this less-than-stellar debut. As the saying goes, "you only get one chance to make a first impression". That's especially true in this day and age of the web and blogs where, within hours, your initial success or failure gets communicated to literally millions. Why does MSFT consistently ignore this?

To me, the answer is found in MSFT's long-standing approach of getting something "okay" out to market, gathering feedback and then eventually incorporating that into a better subsequent product. It's a model that has worked well for them in the past, albeit that it has also resulted in a widely-held perception that first releases, and even subsequent ones, are a work-in-progress and therefore imminently skipable (the old "wait for the service pack" or "they'll get it right by version 3" problem). To be clear, I'm not arguing that gathering customer feedback and then incorporating that into subsequent products is a bad idea - it's obviously critical. The question is whether you do enough work up front to ensure that you begin with an already strong product. In other words, aiming for what Apple's Steve Jobs calls "insanely great" out of the box, versus being content to ship "okay", figuring you can always fix and/or improve it over time. In my opinion, that latter approach too often characterizes MSFT's efforts and it needs to change. Today, markets are moving much faster, competitors (armed with different business models) are much more aggressive, consumers have far more options for their scarce $, and the willingness to pay at all, far less pay to effectively be a beta tester, is fading fast. So in my view, the minimum success bar moving forward is likely going to be "insanely great" not merely "decent". With insanely great, people want to buy your product and tell others about it - versus you having to pour $B's into marketing budgets to try and sell them on it (or god forbid force them to buy contractually). When your products are insanely great, you don't have to hide behind excuses like "our biggest problem in the installed base is the good enough factor". To me, when a customer says that what they have is "good enough", what they're really telling you is that your new product isn't sufficiently compelling and/or you've failed to adequately explain why it is.

Is the ZUNE insanely great? Was MSFT even shooting for that? Was anything less even remotely likely to make a dent in the Ipod? Should the hugely compensated creme de la creme of MSFT's strongest management team ever, have been able to figure that out and if they didn't, are they really the best? More importantly, is insanely great the focus for MSFT and their products generally? Is IE7, for example, great or just a "decent" attempt to catch up? What about Vista? Was it one of the exceptions that actually began as an attempt to be insanely great and then proved too difficult and time consuming (always a concern when you swing for the fence)? Based on what I've read, it will likely be good but fall far short of insanely great. Now to be fair, I think there's increasing evidence that several groups are starting to get it and at least trying to make each release a stellar event. But overall, I think the answer is still no, that is not the defining hallmark of MSFT. Too often, they seem to be content with simply shipping their best yet, versus the best yet. Again, in my view that needs to change and ASAP. Unfortunately, I think the concept is orthogonal to much of what Gates/Ballmer and other senior leaders hold dear based on past success. As a result, it's going to be that much more difficult to instill it as part of the company's DNA. But do so they must.

Update: Interesting article on MSFT and particularly executive J. Allard, which touches on the development and thinking process that went into ZUNE:

• The Soul of a New Microsoft

Update #2: Another interesting article, this time with suggestions on what MSFT really needs to do in order to win:

• Zune: So you want to be an iPod killer