Management and change
–Bill Gates (The richest man in the world)
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William (Bill) H. Gates is chairman and chief software architect of Microsoft Corporation, the worldwide leader in software, services and Internet technologies for personal and business computing. Microsoft had revenues of US$32.19 billion for the fiscal year ending June 2002, and employs more than 50,000 people in 72 countries and regions.
Born on Oct. 28, 1955, Gates grew up in Seattle with his two sisters. Their father, William H. Gates II, is a Seattle attorney. Their late mother, Mary Gates, was a schoolteacher, University of Washington regent, and chairwoman of United Way International.
The birth of Microsoft
A. The idea
During December of 1974, his partner Allen was on his way to visit Gates when along the way he stopped to browse a magazine. After he saw that, it changed his and Bill Gates’s lives forever. On the cover of Popular Electronics was a picture of the Altair 8080 and the headline “World’s First Microcomputer Kit to Rival Commercial Models.” He bought the issue and rushed to Gates’s room.
They both recognized it was a great opportunity for business and their business brain started to work. They knew that the home computer market was about to explode and that someone would need to make software for the new machines.
Within a few days, Gates had called MITS (Micro Instrumentation and Telemetry Systems), the makers of the Altair. He told the company that he and Allen had developed a BASIC that could be used on the Altair [Teamgates.com, 9/29/96]. They had not even written a line of code.
They had neither an Altair nor the chip that ran the computer. The MITS company was very interested in seeing their BASIC since they saw such a thing before. Gates and Allen began to work feverishly on the BASIC they had promised. The code for the program was left mostly up to Bill Gates while Paul Allen began working on a way to simulate the Altair with the school’s PDP-10.
When they both felt their program was ready. Allen was to fly to MITS and show off their creation. The day after Allen arrived at MITS, it was time to test their BASIC. Entering the program into the company’s Altair was the first time Allen had ever touched one. If the Altair simulation he designed or any of Gates’s code was faulty, the demonstration would most likely have ended in failure.
B. The start
During the Spring of 1968, the Lakeside prep school decided that it should acquaint the student body with the world of computers [Teamgates.com, 9/29/96]. Computers were still too large and costly for the school to purchase its own. Instead, the school had a fundraiser. A few thousand dollars were raised which the school figured would buy more than enough time to last into the next school year.
In 1968, Computer Center Corporation opened for business in Seattle. It was offering computing time at good rates, and one of the chief programmers working for the corporation had a child attending Lakeside. A deal was struck between Lakeside Prep School and the Computer Center Corporation that allowed the school to continue providing its students with computer time.
Gates and his comrades immediately began exploring the contents of this new machine. It was not long before the young hackers started causing problems. They caused the system to crash several times and broke the computer’s security system. They even altered the files that recorded the amount of computer time they were using. They were caught and the Computer Center Corporation banned them from the system for several weeks.
Bill Gates, Paul Allen and, two other hackers from Lakeside formed the Lakeside Programmers Group in late 1968. They were determined to find a way to apply their computer skills in the real world. The first opportunity to do this was a direct result of their mischievous activity with the school’s computer time.
The Computer Center Corporation’s business was beginning to suffer due to the system’s weak security and the frequency that it crashed. Impressed with Gates and the other Lakeside computer addicts’ previous assaults on their computers, the Computer Center Corporation decided to hire the students to find bugs and expose weaknesses in the computer system. In return for the Lakeside Programming Group’s help, the Computer Center Corporation would give them unlimited computer time.
The boys could not refuse. Gates says “It was when we got free time at C-cubed (Computer Center Corporation) that we really got into computers. Although they were hired just to find bugs, they also read any computer-related material that the day shift had left behind. The young hackers would even pick employees for new information. It was here that Gates and Allen really began to develop the talents that would lead to the formation of Microsoft seven years later. This was how Bill’s business got started.
C. Products’ Overview
1983 Microsoft Windows was announced November, 1983 and sells for $100.00.
1985 Microsoft Windows 1.0 is introduced in November, 1985 and is initially sold for $100.00.
1987 Microsoft Windows 2.0 was released December 9, 1987 and is initially sold for $100.00.
1987 Microsoft Windows/386 or Windows 386 is introduced December 9, 1987 and is initially sold for $100.00.
1988 Microsoft Windows/286 or Windows 286 is introduced June, 1988 and is initially sold for $100.00.
1990 Microsoft Windows 3.0 was released May, 22 1990. Microsoft Windows 3.0 full version was priced at $149.95 and the upgrade version was priced at $79.95.
1991 Microsoft Windows 3.0 or Windows 3.0a with multimedia was released October, 1991.
1992 Microsoft Windows 3.1 was released April, 1992 and sells more than 1 Million copies within the first two months of its release.
1992 Microsoft Windows for Workgroups 3.1 was released October, 1992.
1993 Microsoft Windows NT 3.1 was released August, 1993.
1993 The number of licensed users of Microsoft Windows now totals more then 25 Million.
1994 Microsoft Windows for Workgroups 3.11 was released February, 1994.
1994 Microsoft Windows NT 3.5 was released September, 1994.
1995 Microsoft Windows NT 3.51 was released June, 1995.
1995 Microsoft Windows 95 was released August, 1995 and sells more than 1 Million copies within 4 days.
1996 Microsoft Windows NT 4.0 was released August, 1996.
1996 Microsoft Windows CE 1.0 was released November, 1996.
1997 Microsoft Windows CE 2.0 was released November, 1997.
1998 Microsoft Windows 98 was released June, 1998.
1998 Microsoft Windows CE 2.1 was released July, 1998.
1999 Microsoft Windows 98 SE (Second Edition) was released May, 1999.
1999 Microsoft Windows CE 3.0 was released 1999.
2000 Microsoft Windows 2000 was released February 2000.
2000 Microsoft Windows ME (Millennium) released July 2000.
2001 Microsoft Windows XP is released October 25, 2001.
Over the past two decades, Microsoft Windows® products have evolved from a single, one-size-fits-all desktop operating system into a diverse family of operating systems and mobile technologies. Today, Windows products help people worldwide achieve their potential at work, home, and just about anyplace in between.
On November 10, 1983, Microsoft announced Microsoft Windows®, an extension of the MS-DOS® operating system that would provide a graphical operating environment for PC users. With
Windows, the graphical user interface (GUI) era at Microsoft had begun. Even there were some other good OS before them, like UNIX and Mac OS, their products was still very successful.
Before Bills starting his business and his products there were already some products in the technology market like Unix and Mac OS. They were complicated and require high skills of education and training.
When Dos that was Microsoft Company¡¦s first product has come out, it overtakes and influences a large area of the technology market. The software attracts home users and offices because it was more user-friendly and easy to understand without requiring a high level of technology skills.
In a matter of fact, it was very hard for Bill to construct such a huge and high technology company because he has not gained any support from the government. But hopefully, he got great financial support from his family.
His company is a labour intensive system. There is 50,500 staff and it has branch department in 70 countries. His aim is to make everything on the top, every product should be on the top of the high tech equipment. Therefore he paid a lot on the development. This year, the company is committed to a long-term view, reflected in its investment of more than $4 billion in research and development.
He has some main management targets. One of Microsoft’s key strategies is, “Find smart people who know the technology and the business.”( According to the authors of Microsoft Secrets).
One of the reasons why Microsoft people need high levels of competence is the fast-changing nature of the industry in which it competes. Microsoft rose to its position of industry dominance in a period of a few years, and Bill Gates, the company’s well-known CEO, is determined that the company will stay on top.
For example, Gates and other Microsoft executives recently concluded that the company needed to embrace the Internet and incorporate it into virtually all products and services. As a result, software developers and marketers need to be able to acquire new skills quickly.
Financial report of Microsoft
A. Financial Highlight:
In millions, except earnings per share
Year Ended June 30 1998 1999 2000 2001 2002
Revenue $ 15,262 $ 19,747 $ 22,956 $ 25,296 $ 28,365
Operating income 6,585 10,010 11,006 11,720 11,910
Income before accounting change 4,490 7,785 9,421 7,721 7,829
Net income 4,490 7,785 9,421 7,346 7,829
Diluted earnings per share
before accounting change 0.84 1.42 1.70 1.38 1.41
Diluted earnings per share 0.84 1.42 1.70 1.32 1.41
Cash and short-term investments 13,927 17,236 23,798 31,600 38,652
Total assets 22,357 38,321 51,694 58,830 67,646
Stockholders¡¦ equity 16,627 28,438 41,368 47,289 52,180
B. 2003 Annual Report
„h INCOME STATEMENTS(In millions, except earnings per share)
Three Months EndedJune 30 Year EndedJune 30
2002 2003 2002 2003
Revenue $7,253 $8,065 $28,365 $32,187
Cost of revenue 1,368 1,238 5,191 5,686
Research and development 1,184 1,336 4,307 4,659
Sales and marketing 1,543 2,104 5,407 6,521
General and administrative 284 1,194 1,550 2,104
Total operating expenses 4,379 5,872 16,455 18,970
Operating income 2,874 2,193 11,910 13,217
Losses on equity investees and other (14) (15) (92) (68)
Investment income (loss) (617) 689 (305) 1,577
Income before income taxes 2,243 2,867 11,513 14,726
Provision for income taxes 718 946 3,684 4,733
Net income $1,525 $1,921 $7,829 $9,993
Earnings per share (1):
Basic $0.14 $0.18 $0.72 $0.93
Diluted $0.14 $0.18 $0.70 $0.92
Weighted average shares outstanding (1):
Basic 10,830 10,737 10,811 10,723
Diluted 11,061 10,862 11,106 10,882
(1) Earnings per share and weighted average shares outstanding for the three months and year ended June 30, 2002 have been restated to reflect a two-for-one stock split in February 2003.
We can see the net income is become more and more. It means the company is running even more successful than before. We also see the research and development fee are so much, he spend a lot of money to develop new product, to keep his product on the top of the market, and innovate more new product for people to use, making our life easier than before.
His company is always keeping their products on the top. They are not only concentrating on the Operating System but also another field of high technological products. For example, they have recently innovated the new computer games machine (XBOX), and also the Windows CE to work on the PDA. Again they gained great success.
I believed that their products will also leading the market, and will bring many conveniences to us. They will keep innovating new products and making all the software more users friendly and easy to use. No doubt, his company will still be one of the best in the world. And his management skills are a good example for us to learn.
(Bill Gates: Well, a business will be changing more in the next ten years than has in the last twenty-five. Because of the digital tools and, in particular, the PC and the Internet, the way that we organize our business, the way that we use our workers, the way that we buy and sell, the way that we collaborate, all of those would be very different.
The leading companies, the successful companies of this next era, will be the ones that embrace this digital revolution and build what I call a digital nervous system.) (According to the Interviewed on March 11, 1999, in Yokohama, Japan.)
From this interview, I could find out that he is going to make his business even better. Making the products to suit people, to make people comfortable, to make people interested, are the aim. Hence, I forecast that his product and his business will be even successful.
Business at the Speed of Thought¨ <Bill Gates 1999>
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