the HubOne Blog

In Part 1 of this series, we discussed the high level current state of Microsoft’s Cloud technologies.  You can find a link to that article here.  To summarize; at the time of this writing, Microsoft has four separate Cloud product clusters and those product clusters each exist in a separate fashion, unrelated to the others.  An appropriate visual image would be of a series of stovepipes, each unrelated and not touching the other. In Part 2 of this series, we take a look at the effects that the current state has on Microsoft’s customers and partners, especially its small business customers.

Now, before the gentle reader becomes indignant with the remainder of this post or series (as some of you already have based on the feedback we got from Part 1), we would like to point out several things.  We at HubOne are passionate and ardent Microsoft fans.  Indeed, a substantial number of our employee are ex-Microsoft and those of us that worked there felt fortunate to do so.   Substantial portions of our business depend on the Microsoft Cloud.  Believe us when we say that we are “All In”.  However, it is perhaps the most ardent of fans that is capable of presenting the most complete critique of his favorite team.  We did not create the Microsoft current state.  We are simply covering the current state with the goal of helping our customers make informed decisions and with the heartfelt hope that Microsoft will begin to see the effects of its current state on its customers and will change some things accordingly.

We like parables.  They help explain complex ideas in succinct fashion and they help put appropriate context around issues by using mechanisms of explanation that the reader is familiar with.  Therefore, we thought we would use a fictitious customer to help explain the effects of the current state of Microsoft’s Cloud on its customers.  For the record, we are using the term “Cloud” to describe both the technology and the business decisions around the technology.

Meet AccountClaim, a small company with less than 30 employees in two countries.  AccountClaim provides a variety of financial services to its customers, most of whom are small companies themselves.  As a purveyor of financial services, AccountClaim uses computers on a daily basis, but computers are not their primary focus; financial services are.  Computers simply provide them with a more efficient way of delivering their services.  While they are expert end users, they do not have a formal IT department (person).  Nor do they want one.  For argument’s sake, we shall say that AccountClaim uses an IT partner (also a small company) for all of its IT needs and they are relatively happy with them, although perhaps not ecstatic.

Recently, the head of the firm (we shall call him Nick) has been reading about this “Cloud thing” and has decided after some cursory research that this would be the direction he wants to go.  This is 2012 and he needs to cut costs given the current economic climate and outlook for the next year (btw, Nick is an avid reader of the Economist and their forecast issue scared the bejeebers out of him).  He likes the idea of being “all in” and he is not afraid to take on some challenges if need be.  One of the challenges facing Nick in his pursuit of “this Cloud thing” is that he has been bombarded with telemarketers, email and web advertising for cloud based products from a dizzying array of vendors.  For example, he has heard from Salesforce.com, sage, rackpower, NetSuite, AWS etc.   However, since his firm has been using Microsoft Office for years, Nick has decided that he is going to go with the Microsoft Cloud for everything.  Therefore, “All in” for Nick means three product clusters: CRM Online, InTune and Office 365.  Rather than trying to pick a best of breed solution, Nick assumes that because these products (CRM, 365, InTune and CRM Online) are from Microsoft, he will have a “one stop shop” experience, either directly with Microsoft or via a partner. 

Unfortunately, this is where things get interesting.  This is also where the ramifications of being a customer who is “All in” begins to surface…

Before we start to skip down the primrose path, we would like to refer back to one of the visuals we used in Part 1 of this series.  In order to understand the ramifications of the remainder of this post (and the rest of the series) it is vitally important that you keep this image in mind:

-The first thing that Nick discovers is that there is no single place for him to go to interact with the Microsoft Cloud for “technical” matters.  There is no single place for administration, no single place for alert management, no single place for adding accounts, no single place for deleting accounts, no single place for account permissions of any kind (account management), no single place for service status, no single location for what’s in upcoming Service Updates (and no single policy for how Microsoft communicates those new capabilities).  In fact, there is no single place for administration across services of any kind.  This means that Nick three locations (CRM Online, InTune and Office 365) for each and every technical action he takes. Not only does Nick need to administer in three places, but the technical capabilities of the products differ – not on a feature set (which they should) but on an infrastructure point as well.  For example, some of the products support FIM, some do not.  Some use PowerShell for administration, others do not.  Some of the products support REST while others do not…

-The second thing that Nick discovers is that there is no single governance in effect for the Microsoft Cloud for “policy” matters.  This means that there is no single policy governing downtime notifications (also known as Service Impacting Events or SIE) or what even constitutes an SIE, no single policy regarding notifications of upcoming Service Updates (that could cause downtime), no single governing policy of any kind (that we are aware of). If Nick wants to check upcoming operation events that could affect his business he has to check in three places.  If Nick wants to receive a credit for downtime in one of the services, he would have to use one of three different locations.   If more than one service goes offline at the same time (as happened a few months back), Nick would need to go to every service affected individually.  If Nick wants to interact with the services in different languages he has to check in three different locations (they have different language supports, albeit only small differences.  Good think Nick speaks English).  In summary, Nick has to track potentially three different policy sets each and every policy matter that affects his business.

-The third thing that Nick discovers is that there is no single governance in effect for the Microsoft Cloud for “business” matters.  In effect, as far as the Microsoft Cloud services are concerned, Nick is a separate customer for each service he purchases.  This means that there is no single place for ordering services, no single place for ordering additional services, no single place to increase his seat counts of existing services, no single bill (there are three) no single place to review notifications from MSFT, etc. If Nick wants to increase his number of seats, he has to do it in three places.    If Nick wants to review upcoming release schedules and projected feature sets, he has to do it in three places.  In summary, Nick has to interact with three different businesses for each and every business action he takes or wants to take. Not only is there no single business governance in place, but the business models themselves are not in alignment.  For example, one product clusters uses a Partner Access model and the others do not.  One product uses something called “syndication” and the others do not (more on this topic in a future post) …

 This is not a pretty picture.  This is the origin of our claim in Part 1 that “We’re all in” means “We’re all confused” from a customer’s perspective.  We thought the Cloud was supposed to make it easier for the small business, not more complex. 

So what does this mean?  Let’s be very, very clear here.  We at HubOne believe Nick should run as fast as he can to the Cloud and we believe that Microsoft is the best Cloud for Nick to run to.  The Cloud will provide immediate cost benefit and provide immediate IT administrative gains (reduced administrative complexity, improved reliability, scalability, etc.), especially for small business.  And we believe that the products clusters that Microsoft offers are either best in breed or close to it.  And therein lies the problem; for once a customer decides to implement more than one product cluster, their complexity increases geometrically and this causes unnecessary challenges for the customer – specially for small businesses.

Evidence indicates that some of the decisions that are being made are geared towards an older, enterprise focused development path that sometimes does not answer the needs of small businesses as well as it should.  For example, there are tools and technologies for the Microsoft Cloud that would help an IT pro address some identity issues.  But remember, Nick is a small business owner, not an IT pro.  And there are license mechanisms that will help reduce purchasing complexity.  But remember that Nick is a small business not an enterprise.  And we should remember that this is a small customer that is turning to Microsoft to help deliver on the promise of “Cloud” (a promise that Microsoft itself helped create) across its entire business – not just in one area; this customer is “all in” and wants desktop management and Office Cloud and CRM.

In summary, the current state of Microsoft’s Cloud is not ideal and it can improve a great deal – especially for small business.  We believe that Microsoft will address some of these technical issues, as history has proven it is capable of doing.  We also believe that some of the business issues will be slow to be addressed, as history has also proven.  We believe that Microsoft can do better and that it should do better, especially for small business.  By its own numbers, the majority of Microsoft’s cloud customers (number of customers, not seat count for those customers) are small businesses with less than 20 seats.  In fact, evidence indicates that far and away the largest portion of Microsoft Cloud business is small business. 

If that is true, then perhaps Microsoft should pause; take a look around where it is running to and why it is running that direction and should measure the effects of its decisions cumulatively.  And it means that Microsoft’s should perhaps look at the consequences of its decisions holistically rather than product by product – especially for small business.

In part 3 of this series, we will look at why the current state exists.

We’d like to know what you think.

Jim; jimcar@hubone.com