30 minute interview

“We will take our services experience and feed that knowledge back to our product groups”

R Devenuti, Senior Vice-president, Microsoft Services and IT, Microsoft Corporation, explains how the company is using its experience in working on pilots to shape up its future in the services space.

R Devenuti

Is IT services a new field for Microsoft?

The IT services division exists to help customers accelerate successful and productive adoption of Microsoft technology. Managed desktop services for Energizer are a tiny element of that. Most of our people are working with IT professionals within companies to help them accelerate the adoption of Microsoft technologies. IT environments are complex and companies want to rapidly adopt new technologies. At that point they approach us. Our IT services division has grown by 16 percent this year globally and is in line with analyst’s expectations.

How are you going about helping your Indian customers?

In India, we are working with ICICI and helping them use the BizTalk server to bring together information from disparate systems.

Our roles include accelerating the adoption of technology and its productive use. Our implementation practices extend to deep relationships where we architect solutions, offer our project management skills and help develop and architect business applications in verticals such as finance, healthcare and retail. We implement infrastructure such as Microsoft Exchange, Active Directory, and Systems Management Server. We also offer training on how to use data centres and operate Microsoft technologies and the best practices for the same. We conduct quality reviews where we take a look at the proposed architecture of a new system to see if you want to do some things differently. We also help the customer—by providing support proactively and reactively. ICICI and Airports Authority of India are some of our customers in this region.

You had a pilot with Energizer to kick off your IT services. Please elaborate?

Microsoft has been involved in IT services for many years. Microsoft Managed Solution (MMS) is a ‘hosted desktop and collaboration offering’ that is designed to remotely deliver up-to-date software and services to enterprise customers, helping them keep their systems, processes and data more secure and reliable, while enabling them to focus on their business priorities. Our short-term plan is to engage with a limited set of customers with diverse environments that Microsoft and its partners will remotely manage. We will take our services experience and feed that knowledge back to our product groups.

As part of the Energizer project we are providing key IT services to customers such as Energizer Holdings and XL Capital to deliver Exchange e-mail and SharePoint collaboration and portal servers hosted at Microsoft’s own data centre. The deal includes desktop PC-related services, such as planning for deployment of new PCs and remote management of PCs that have already been deployed, testing new applications and packaging them for deployment to desktops as well as second-tier help-desk services. Both companies continue to operate their own data centre for line-of-business applications, related databases, and other central IT operations and Microsoft partners provide desk-side support and first-tier help-desk services. These partners use Microsoft’s trouble-ticket system, which makes it easier for MMS to collect data on the types and frequency of incidents involving its services, even if these incidents are resolved by the partners rather than by the MMS.

The objective of MMS is to use the experience gained to reduce the total cost of ownership of desktop computers.

With not much of a service provider background, how do you plan to compete with established names such as IBM Global Services, HP, and EDS?

Microsoft Services is the consulting, technical support, and customer service arm of the world’s biggest software company. We are focussed on providing value to our customers, either directly or through our partner network. Our goal is to make our products successful in the market and drive customer satisfaction. We want to help customers accelerate their adoption and make productive use of the Microsoft technology that they have purchased. As we are a partner-led company, our partners will continue to play an integral role in most of what we do. At the macro level we don’t compete with partners. We’re a fraction of the size of our largest partners and we account for less than one percent of the worldwide services market.

We see great potential for growth, both for us and our partners, because the market for enterprise solutions is growing. Gartner estimates that worldwide IT spending will grow $175 billion over the next four years, hitting $425 billion in 2009. Microsoft has momentum, a set of product launches that are coming up, and is well positioned, along with its partners, to capture a large portion of that growth. Our Enterprise-focussed groups (EPG and Services) are taking action to ensure that our software and the service providers for the Microsoft platform are positioned to sustain business in this space with closer customer relationships. A recently announced plan to invest more than $30 million in a skill-building effort for our partners will add over 45,000 incremental new certifications during Microsoft’s FY07.

There is always a delicate balance between competition and cooperation with other service providers but with our global partner network and support infrastructure we can do it. We’ll be doing the right things with our services organisation to act as a lever to move the market and serve as a catalyst for growth. Our partners will see great benefit from our activity. Microsoft Services will stay small, focus on accelerating adoption and improving productive use of our products, and will continue to invest in and count on partners to deliver the vast majority of service opportunities to our customers.

—Akhtar Pasha