Running Head: ORGANIZATIONAL THEORY
Organizational Theory
Student Name:
Affiliated Institution:
1
Organizational Theory
Which of the following technology best characterizes the way Microsoft operates?
a) Craftwork (b) engineering production, or (c) intensive technology
Based on the case study, Microsoft’s technology can best be characterized as intensive
technology. Intensive technology entails characteristics such as research, development,
production, and marketing of technologies or products. These technologies or products range
from new materials technology and related products to electronic information technology and its
related products; for example, information processing software. Microsoft’s case suggests that
the company is involved in electronic information technology. To this end, a company deals with
specializations such as: signal processing; mobile communications; networks and distributed
systems; vision, graphics and interactive systems; computer vision and graphics; intelligent
autonomous systems; and, GPS technology(Rothaermel, 2008).
Microsoft is a software maker that wants to manufacture faster versions of internet
applications in areas such as imaging searching, internet phone services, search engines, and
mapping. Its need for improvement is also based on the speculation that in the future, people will
start using online storage applications. In order to achieve its goals, Microsoft has to be an
intensive technology company. According to the case, Microsoft has announced a major
organizational structure redesign based on three major service products and software areas.
These areas are: Business, Entertainment & Services, and Platform Products & Services. To this
end, Microsoft has restructured its hierarchy management system so as to assign different
management teams to each business area. These new structures are expected to create synergies
between the product divisions, speed technological innovations in each division, and foster
collaboration between departments so as to enhance the outcome of innovative products and
2
Organizational Theory
services. As an intensive technological company, Microsoft is trying to offer new software by
developing internet-based service platforms, and to improve its Windows platform(Jones, 2009).
In what ways does Microsoft hope its new way of organizing will help it to continually
improve its competencies and technology?
According to Porter (2008), by broadening the role of technology to exploit new
technological trends and achieve innovation, companies can achieve a sustainable competitive
advantage in the market in which they operate. Technology is a very significant driver of
innovation that helps enhance the benefits of business innovation. Therefore, aligning technology
with business ensures that a company’s redesign strategy is flexible enough to adapt or change if
necessary. Implementing a continuous competency and technology strategy guarantees a valuebased landscape in the long run(Porter, 2008).
Microsoft hopes that developing internet-based service applications and its Windows
platform will help create competitive advantage in the market in which it operates, attract new
customers, and maintain their existing customer base. To achieve this, the company has
announced redesign in its organizational structure to three business units; Business,
Entertainment & Services, and Platform Products & Services. These business units will be
managed by different teams so as to speed technological innovation, create combined efforts and
collaboration among the business units, and improve its product and service development across
the organization. The company’s CEO stated that it was undergoing these changes so that it can
enable itself to conduct its business with skill in managing the expected future growth and
successfully implement its software-based service strategy(Jones, 2009).
3
Organizational Theory
References
Jones, G. R. (2009). Microsoft Case Analysis. Upper Saddle River, NJ: Prentice Hall.
Porter, M. E. (2008). Competitive Advantage: Creating and Sustaining Superior Performance.
New York, NY: The Free Press.
Rothaermel, F. T. (2008). Competitive Advantage in Technology Intensive Industries. Advances
in the Study of ENtrepreneurship, Innovation and Economic Growth, 201-225.