The following are key excerpts and call outs from an interview with Jared Spataro, Corporate Vice President at Microsoft, responsible for Modern Work at Microsoft at Credit Suisse´s 24th Annual Technology Conference (Dec 1, 2020).
Specifically, if you are a CIO, we think this is worth reading.
Modern work
World´s productivity cloud
Platform for the digital workforce
People centered
Platform versus best of breed
Respond, recover and re-imagine.
Digital platform for work, life and learning.
Stop the escape from the digital exhaust – Microsoft Graph
Knowledge graph of the organization, project Cortex
Using the platform to capture, aggregate, process and create real value from that signal
UCaaS (unified communications as a service)
Teams dual usage with other solutions (Slack, Zoom)
Teams as a platform
Security – consolidating other vendors
Industry specific scenarios for Teams
Custom apps and process automation
Learning
Wellbeing
Life scenarios
Modern work
First thing to notice is that Microsoft no longer speaks about modern WORKPLACE but about modern work. They have, rightfully, done away with the word place. Work is an activity you do, not a place you are at.
World´s productivity cloud
Microsoft 365 for us is a key pillar of the overall Microsoft strategy. As you indicated, world’s productivity cloud is the way that we’ve talked about it.
Platform for the digital workforce
It is this comprehensive solution where we’ve tried to bring in what we would call workloads, different services and integrate them together to essentially provide aplatform for the digital workforce.
People centered
The design principle behind all of it, really has been people-centered. It’s meant to really create a workspace in the cloud for a particular person and for that person to work on their own and to work with other people both inside and outside their organization, and to really create a brand new digital environment for them to conduct business in a commercial sense.
Platform versus best of breed
The last thing I’ll say is a lot of times people have compared and contrast of what we have done with this digital platform with kind of a best of breed approach, maybe bringing a Slack and a Zoom and a Dropbox together to assemble a similar type of offering. When we think about what we’re trying to do, we’re really trying to create a no compromise solution. We’re looking for both breadth of workloads, so completeness of workloads, but we want to be able to compete head-to-head on each workload and win and be – and have depth and be very deep in those workloads as well. And I hope we get to that as well, but that no compromises approach is really important to us.
Respond, recover and re-imagine
What we meant by that is that we anticipated, and this is the way it largely played out, but there’d be such a big shock to the system as everything went digital that the first thing that our customers would want to do is just to respond to, essentially scramble and say, we’ve got to keep operations going.
Then once they kind of had gotten to that point and they had a little bit of operations running, they were going to need to look at their recovery; how do we get back to kind of, where we were in terms of being able to conduct all the business that we were doing but now in a different way.
And then the final part of that respond, recover, and the third part is re-imagine. And we anticipated that people would say, what are we learning here? As we have moved so much of our processes, so many processes digital online, are there things that we could do differently? Because we found that in the early parts of the pandemic, people were just trying to repeat what they had done in the old world, kind of in this new digital world. And there was this opportunity to re-imagine, to re-think that.
So, a lot of what we think will persist will be the learning of what digital capabilities can do to augment how we get business done, how we’re going to keep a lot of that. Just in the Wall Street Journal today, there was an article about travel, perhaps being down for a long time, as much as kind of 36%, 39% or so. We think people will travel again. But we think what they’re learning right now is how do you use video communications to do business in a way that they didn’t know how to do it before the pandemic. So those things we think will persist.
Digital platform for work, life and learning
We’re starting to see people ask, well, what happens post-pandemic? What happens when the conditions change a little bit? We see it this way, video conferencing was that immediate signal, but the long-term opportunity is not video conferencing. The long-term opportunity really is this platform for work, life and learning, this digital platform for work, life and learning.
TAM (Total Addressable Market)
We historically have thought about the TAM for my business, what we would call Modern Work as essentially knowledge workers and knowledge workers in developed nations, in fact. But what is happening with this opportunity that’s opening up for a digital platform, for a digital workforce going forward is that we see two really big ways for the TAM to expand. First is in socket expansion, where we can move well beyond knowledge workers, into firstline workers, SMB, education, industry-type scenarios. And the second is TAM expansion as we’re able to move well outside the traditional core office suite and over to things like security, compliance, collaboration well into these areas that we are seeing Teams be able to take us.
Stop the escape from the digital exhaust – Microsoft Graph
A lot of the innovation that we’re doing and that the reason that we’re so excited is as everything moves digital, we have this opportunity to stop this escape of the digital exhaust, if you will. Everything that you do digitally, it kind of creates signal is the way that we talk about it. That signal can be as rich as a document that I write, but it can also just be simply the fact that you and I are meeting together one time, two times, three times over time, that signal is incredibly valuable. And today, most of that signal really does dissipate out into the ether.
So the basis for a lot of our innovation is this idea that we should stop letting that signal escape, and start capturing and aggregating that signal, then reason over that signal and provide value in two ways, value back to the end user in the form of services that can help them really get work done and value back to the organization in the form of kind of insights that help them understand what work is getting done and how they can get work done more efficiently.
So, to make that really specific at an end-user level, we talk about this idea of really creating first the Graph. And we don’t talk about it externally in a whole lot, but we call it the Microsoft Graph. This Graph is the aggregation of signal. It is done per customer; we’d say on a per tenant basis. So it’s specific to the customer, the tenant, and then it’s even specific at the graph level to an individual user. So, for instance, at an individual user level, we can hand back things like a designer in the cloud that manifests itself in PowerPoint. We’ve been doing this now for a couple of years. We have billions of slides kept as we now suggest slides – for people.
Knowledge graph of the organization, project Cortex
And as we move to the organization, we can even kind of expand the way we use that. We have something called Project Cortex, which creates a knowledge graph of an organization. This ends up becoming the most important database I think for optimizing productivity because it can help the organization, know what it knows and help people to tap into that knowledge. And we’re even using all of the signal for security with Microsoft Intelligent Security. We read over 8 trillion of those signals that I just referenced a day across products in helping with remediation and proactive identification of security threats as well.
Using the platform to capture, aggregate, process and create real value from that signal
So that’s kind of how we think about the innovation. We see this wonderful opportunity, not just to create the platform as we talked about a few minutes ago, but then to make sure we’re using the platform to capture, aggregate, process and create real value from that signal. That’s where you’re going to see a lot of the innovation coming from.
UCaaS (unified communications as a service)
We’re really proud of our standing in the Gartner Magic Quadrant that just released here recently, where we are a leader in the UCaaS Magic Quadrant as well as a leader in the Meetings Magic Quadrant. …… help customers move from using Teams as maybe a chat platform or a meetings platform up to telephony, super important for us.
It depends on how you look at the market, but we certainly look at it as being as big as hundreds of billions of dollars of TAM. When we’re all in to telephony, we don’t think of it as just a single workload. We think of telephony integrated into that flow of work.
We think work gets done through several activities: one-on-one interactions, personal focus time, meetings, phone calls, recorded events, all sorts of different types of work. And Teams is built to support that. The telephony components are integrated deeply into what we’re doing with that whole idea of the flow of work. So again, our differentiator for this is that we are looking to be that platform to support the work as it flows through different activities.
Teams dual usage with other solutions (Slack, Zoom)
We definitely see dual usage. This is the place where we have to earn our customer’s business every day. We actually have to earn it down at the individual user level. They have to be satisfied with the experience.
However, what we see is that the dual usage plays to our strengths over time. It does so at the end-user level, because of the integration where Teams offers in a single app things that other competitors don’t. It does offer you ability to chat, call, to meet, to content collaborating and work together, even to integrate into process automation and the work that we’re doing with Power Platform, all on a single-app. So users definitely feel drawn to that because of the simplification for them of their own workflow.
And then as we start to talk with decision makers within an organization, I think we have a great value prop, cost savings immediately comes up, from our perspective there is a gravitational pull to a platform. We think there’s a lot of economic value in that platform. And we can offer that combination of calling and meeting and chat for a much cheaper price than you could, if you’re going to try and go out and assemble those things by pulling together these other separate players.
In addition to that, there’s still cost savings beyond just the per-user-per month type saving you can do, because typically you’re going to have to do some integration of identity across different service providers. You’re also going to have to look carefully at things like security compliance, all of that is built in.
We think dual use again plays to our favor. We love it when we can get in the door with whatever workload customers are ready for, sometimes meetings, sometimes its chat, sometimes it’s just content collab. Once we get in to the door, we’re very confident in our ability to have end users to discover the power, and then we can have a really good discussion with the decision makers. So that general idea of kind of landing and expanding as the industry would talk about kind of characterizes our business model with Teams and our breadth there. And then the depth in the workloads allows us to compete really well.
Teams as a platform
We think of Teams as scaffolding. We think of it as a platform. We certainly love what we’d call those built-in first-party workloads of chat, meet, collaborate and call, but we’re even more excited as people continue to use it as a platform and use things like Power Platform to build, process automation their own customized apps, do some really interesting things.
Security – consolidating other vendors
The move to – almost everything being digital means, that there’s more data and more devices to protect, also means that companies who have long held beliefs about what security meant to them, often bound for instance to the workplace, the physical workspace they’ve had to change overnight.
We have taken a posture for a long time that in the industry has been called Zero Trust. It literally is you have zero trust for the people, the devices, et cetera, people have to verify, every device has to be verified. That has been proven to be, I think the right stance to take as all of a sudden, companies have realized that your own home office has to be as secure as the campus office was.
We have a lot to use in Teams to lead us into that security discussion, three in particular, Data Loss Prevention, where we can use DLP, Data Loss Prevention within Teams to really secure the communications in Teams, what we call Advanced Threat Protection, where customers can protect users from malicious software, both proactively and with automated remediation and finally Cloud App Security, where we certainly secure Teams, but then we allow people to use that same security service to secure other apps in their portfolio. Teams has helped us to really explain the value I think of all three of those things in nice way.
We really differentiate from the competition in three ways. We have built-in security experiences. So in other words, we secure our own stuff as you would expect us to with really best-in-class security. But we also integrate with other solutions and secure other components of a customer’s state, something that’s little known. And finally we have all of those signals we talked about to apply AI and automation to what we’re doing with security. And this just puts us into a really nice space.
In particular with all the complexity associated with security, we’re able to go in and have a conversation about consolidation of vendors, of the consolidation of kind of different services and that’s playing very well for us right now. So Teams is kind of the front end of the spear for us, it opens up broad discussion on security broadly.
Roadmap/Future
Industry specific scenarios for Teams
The immediate opportunity continues to be meetings and collab. But let me talk about a couple of others. I’m very excited about. We’ve got the opportunity to use Teams as this platform for healthcare, for first-line, other industry specific scenarios. We’re starting to really see that pop. I tend to think of it this way, take Zoom, combine it with WhatsApp and create a platform for it and you have got an awesome visual platform for businesses to use, that’s the conceptual idea I think that represents an opportunity for Teams, you’ll see us really go hard after that.
Custom apps and process automation
Mission critical process has being integrated into teams, so kind of process automation and this idea of creating custom apps that could go using Power Apps, that’s going to be a very big investment area for us.
Learning
Learning is interesting to us. We do think corporate learning is going to change in very dynamic ways, that’s going to stop being such a sleepy area and start being a real dynamic growth engine for corporations, as they’re trying to help people get up to speed if their jobs change and the dynamics of the marketplace mean it, we’re working in a very volatile environment.
Wellbeing
Wellbeing – helping with employee wellbeing, we actually think is really interesting. We’ve got some really interesting work, we’re doing with teams here, including partnerships with people like Headspace, thing as meeting fatigue and taking care of your employees, we’re starting to see it’s become a real priority for companies around the world.
Life scenarios
And then one final place that I’ll just say, watch this space, Teams – people think of Teams largely as a commercial offering for businesses and governments can surely have, we’ve got great success there. We have launched with very little fanfare capabilities both in the mobile product and the desktop product just over the last couple of months that allow us to expand well out of the commercial scenarios into life.
We are really excited about this formula one app that does more than any other app in the marketplace, applying also to people’s lives, to their families, the sports clubs to opportunities out there that are more consumer-oriented.
We also think that creates a very interesting virtuous flywheel as we see work, life and learning, reinforce each other, so please watch that space. Again, as we think about a digital platform, we’re not just thinking about commercial opportunities, but about opportunities across someone’s whole life and there’ll be some great things coming.
