Michael Wylie - Founder of ServNet LLC

While many idolize and praise Microsoft for being one of America’s great iconic companies, Michael Wylie has criticized their business strategy for years.  “They don’t have the consumers’ best interest in mind” said Wylie.  In 2009, shortly after graduating from Cal State Stanislaus with a bachelor’s degree in Computer Information Systems and Business Strategy, Michael Wylie outwardly proclaimed that Microsoft had already passed the first two stages of decline as outlined by Jim Collins: Hubris Born of Success and Undisciplined Pursuit of More, placing the corporation in stage three: Denial of Risk and Peril. 

Jim Collins, one of Michael Wylie’s favorite authors, wrote “How the Mighty Fall” in 2009 and describes organizational decline in five stages:  Hubris Born of Success, Undisciplined Pursuit of More, Denial of Risk and Peril, Grasping for Salvation, and Capitulation to Irrelevance or Death.

Many industry analysts disagree with Michael Wylie, claiming that the Microsoft giant will be around forever, however Wylie saw the trends and accurately predicted the early stages of decline.  History shows that while few and far between, a business can reach the dark bottom pits of stage four and make a comeback.    Thus, Microsoft’s poor business practices don’t necessarily mean they’ll vanish; they do have the opportunity for redemption.

For the first time in the company’s public history, Microsoft posted its first loss ($492M) in the 4^th quarter of 2012.  Analysts say the loss is because of the failed $6.19B aQuantive acquisition.  Michael Wylie doesn’t doubt the role it played, though says we can’t dismiss the event as a single occurrence.  While revenue has continued to increase over the past decade, since 2008, the year over year percentage has significantly diminished.  Yes, we’ve had a recession, though it has not affected Microsoft’s largest competitor: Apple, Inc.  Rather, Apple’s market capitalization reached $619 Billion, beating the previous record set by Microsoft in 1999. 

Though Microsoft appears to be teetering on the edge of capitulation, Michael Wylie suggests that Apple could be on the same road to decline with recent mishaps.  Reports say that Steve Jobs fired an Apple executive for releasing the iPhone 4 with unresolved cell reception issues.  Jobs was a perfectionist and didn’t tolerate imperfections in the products he sold.  This is a large part of what made Apple so great.  Comparing Jobs’ dedication to greatness to the post Jobs Apple, we can see considerable undesirable change.  The iPhone 5 was released with more than one major issue.  Not only did the companyremove Google Maps from the phone, replacing it with incomplete and error filled Apple Maps, they also didn’t fully test the phone’s camera, resulting in a purple haze when taking pictures in harsh sunlight. 

Two mistakes may not seem like the end of Apple, but it’s the early stages of Hubris Born of Success.  Michael Wylie is an Apple fan and believes the Steve Jobs way was an excellent business strategy, though companies needs to stay close to what’s important to the consumers if they want to succeed; something Steve Jobs did well.