RACY CASES-67 Lessons from Adversity

V Pattabhi Ram and Valambal Subramanian


“Oh, God, No”.

Another presentation in another of those soporific sessions on IBE (International Business Environment, stupid) was too much for Meghna to stomach. . Worse still, she had to turn up early so as to pick up a spot in one of the last rows!  Why?  Because she could then either take a nap or glance through magazines and at times listen to the class if it was interesting enough.

By the time the last of the 120 guys had sauntered, the professor had walked in. The topic for discussion was “Microsoft: Where are they heading?”  She cursed: “Who cares?”  Prof Chatshow logged on to his laptop, perched himself atop the edge of the table and said, “Ok guys, shall we start off with the discussion?  Now make this session interactive.  Let’s have your arguments.  Yes, who is going to kick it off?”

Before anyone responded, the class’s Senior Citizen put up his hand.  They called him that because he came with the maximum of work experience. Was he on the right side or the wrong side of 30 in a class whose average age was 22, wondered Meghna

“Hi folks. When we think of Bill Gates we almost invariably think of his riches and his software. But there is much more to him than that. Like, he dropped out of Harvard to co-found Microsoft.” Someone in the back row provocatively yawned.  After all Senior wasn’t letting in on a state secret.

“Yup.  We all know that.  But what we don’t know is that his age, rather his youth, was a handicap.  He had trouble leasing premises.  Trouble leasing cars.  While meeting customers at bars, he could not join them for a drink. Too young to drive, too young to booze.  But the guy wasn’t too young to know the language of technology; he knew it like he knew the back of his hand”.  Meghna sat up.  Now, this masala was getting to be interesting.

“In 1979 when Gates co-founded Microsoft (and you folks weren’t born then)  it was positioned as a start up.  Its core traits were its aggressiveness, its  competitiveness and its total indiscipline. Worse still, the company swore only by its product.  Yes the product came both first  and last. The customer came only thereafter!”.  Hey, sacrilege; even a start up shouldn’t act so upstart thought Meghna.

Senior was on a song. “The employees that MS hired were the best.  They were most intelligent and were overpowered by the hunger to win. They got things cracking fast.  The bureaucracy was negligible.  Gates himself was a hands-on performer.  He personally soiled his hands and was not one who operated by remote control.  He was  wholly involved in the operations of the company and took all decisions himself.  The organization was in awe of him.”

There was pin-drop attention in the class.  And no one was snoring.

Senior continued.  “And then the Anti trust trial happened; United States Vs Microsoft. It was the turning point in the life and times of both Bill Gates and Microsoft. The trial brought the kind of publicity that the duo could do without.  It portrayed MS as a monopolist without a soul. And Bill as a villain amassing a fortune not giving way for others. The Department of Justice alleged that MS engaged in sharp practices such as forcing computer  manufacturers to install Microsoft’s internet Browser as a condition for getting its Window’s operating system. For Gates, the trial was a personal agony. People who had earlier held him up in reverence now called him a predator”.

“But why didn’t Gates go for an out-of-court settlement to end the ordeal pronto?” asked Meghna.  “Because, Gates felt that that would amount to an admission of guilt.  In the end however he did exactly that because the trial was becoming  too time consuming and was bad publicity” responded Senior.

Senior sipped a glass of water obviously happy at the kind of attention that he was receiving.  “It was during this period that Steve Ballmer came into the picture. Ballmer was an old Microsoft hand.  He had been Gates’ batch-mate at college and had joined Microsoft during its early days.  The two made a great working pair and complemented each other. While Gates was a star techie, Ballmer was a marketing wizard”.

The class was keener to hear about the anti-trust and realized that the talk about Ballmer was more of a build-up.  Senior didn’t disappoint.

“During the trial MS felt that Gates should slip into the background because he was the prime target. It was a tough call for the Big Man to take.  But in the end he did it for his and Microsoft’s good; allowing Ballmer to take the helm. Gates had never thought that a time would ever come when people would compare his era to someone else’s. It was hard for him to digest that.  Equally hard to swallow was the reforms that Ballmer was bringing about. But to his eternal credit Gates stuck himself to the role of the Chief Software Architect and concentrated on the product”.

“What about Gates philanthrophy?” asked Meghna obviously hooked to Senior’s narrative.  “You just jumped the gun” said Senior.  “It was exactly at this point that Gates began to engage in philanthrophy. He had accumulated so much money that he and his wife Melinda decided to set aside a  part of it for their kids and the rest would to the Gates-Melinda Foundation.  Gates slowly slipped off Microsoft to become more passionately involved in the Foundation which contributed to various causes.  It was great publicity for Microsoft”.

“The adversity that the trial represented brought about significant lessons for Microsoft.  And the company took it in good spirit.”

“Like what” asked Meghna

“Like, it told Microsoft that no matter how you see yourselves, what is important was how others see you. In fact, Ballmer was the first to recognize this.  And he made the company bring about the right changes.  For one, Microsoft asked its employees to be more ‘open and respectful’ in whatever they did. For another, Microsoft felt that it had to communicate to the world outside that it was not a ruthless, aggressive company but was an open and respectful organization.”

“Like, the trial helped Microsoft realize that it had matured and could no longer think of itself as a start up company. Recognizing this Gates and Ballmer de-centralized the operations so as help incorporate proper business processes.  Hence the business was broken down into segments and each segment was headed by a manager with full responsibility for running it all by himself.”

“Wow” said Meghna. She hadn’t intended to say so but her lips gave away her inner feelings.  Senior was naturally happy.

All through, the class had held its collective breath.  And now it applauded.  Even Prof Chatshow smiled.  It was time to shoot questions at Senior. But everyone was sure that Senior would have all the answers.








About Pattabhi Ram

A chartered accountant by profession, a writer by passion and a teacher by accidental choice.
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