Tech Start Up Lessons Confuse: Learn from Failure or Success?
May 14, 2012
I read “Robbie Bach’s Four Startup Lessons from Xbox and Zune.” I am puzzled. The article said:
Bach compared and contrasted the Xbox and Zune businesses and shared some inside stories during a Northwest Entrepreneur Network event Seattle this morning. The topic was “intrapreneurship” — the buzzword for entrepreneurial projects inside major companies — but as Bach noted, the lessons apply to traditional startups, as well.
But the sentence preceding this paragraph was the kicker:
Former Microsoft executive Robbie Bach led the company’s entertainment division through the rise of the Xbox business, which has become a success, by many measures, after billions of dollars of investment and some major bumps in the road. He also led the division through the launch of the Zune music player, which is “probably universally viewed as less of a success,” as he puts it, charitably.
The write up then focuses on four “lessons.” These confused me because even though the Xbox is allegedly successful, there is the red ring of death meme and the need for data to show that the Xbox has paid off the investment and covers the on going customer support and repair activities.
The first lesson is to focus on a “discontinuity.” This is Peter Drucker stuff. The problem is that there are many discontinuities, so isn’t it necessary to pick the right discontinuity at the right time and execute without investing so much that pay back is tough, if not impossible.
The second lesson is marketing and branding. Okay, but Microsoft seems to be a company making and killing brands with dizzying speed. Windows Live, Windows NT, Zune—what’s the brand logic and marketing strategy behind these moves? Windows RT?
The third lesson is find “partners who want you to be successful.” Partners want to make money. If you have something that will make partners money, then you are on the right track. Partners who stop paying for expensive certifications or quietly add “off the reservation” activities are not partners. These are companies run by executives who need revenue growth. There are lots of potential partners. Which partner is the key question?
The fourth lesson is “capitalize on your competitor’s mistakes.” My view is that this has more to do with picking a discontinuity and acting in a timely manner. Much of the so-called “insight” in technology has more to do with being in the right place at the right time. When the right time shifts and the right place moves to another location, most companies end up in challenging situations. Examples range from Microsoft’s support of legacy code to the stunning work on the Windows Nokia phones.
How do these lessons explain the trajectory of Microsoft search technology. Answer: Not too well.
In short, these are “lessons” which need to be reviewed by a curriculum committee. Just my opinion.
Stephen E Arnold, May 14, 2012
Sponsored by Polyspot
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