Ballmer Promotes 'New Efficiency' Vision for IT

Economic reset is forcing IT to show more value for less money. Microsoft CEO pitches new wave of products as being here to help.

The idea of an economic "reset," a new level of spending based on less leverage, that Microsoft CEO Steve Ballmer discussed with partners in July is now a major theme of the company's latest product wave launch.

In a late September launch event in San Francisco for Windows 7, Windows Server 2008 R2, Exchange 2010 and other products, Ballmer gave a keynote talk called "The New Efficiency."

Ballmer took the position that IT pros can do more with less and still innovate by using Microsoft products -- even in the present down economy, which he described as "a reset" or "the new normal." His position was supported by on-stage early adopter testimonials from executives at Continental Airlines Inc., Ford Motor Co., Intel Corp. and Starwood Hotels & Resorts Worldwide Inc. on the efficiencies to be derived from Microsoft's products.

Ballmer said that IT budgets "have been reset down" and that Microsoft would have to demonstrate how its products can help IT departments do more with less. In a Q&A session, Ballmer even suggested that restricted budgets represented a kind of "freedom" for IT departments looking to set priorities.

Steve Ballmer
"One of the interesting things about budget reductions is once the new budget's in place ... in a sense, the budget sets you free," Ballmer said. "You know you can't petition. We don't live in a world where it'll be very easy to petition the business for more money. So it really gets to be a question of tradeoffs."

He also gave a pitch for Microsoft's hosted applications, which amount to a form of outsourcing for many IT organizations.

"We've seen an incredible wave of interest in what we're doing with Exchange Online and SharePoint Online," Ballmer said. "The biggest part of the IT budget in every company is in running the things that you do today. Every dime you can save in the run budget becomes a dime you can reinvest in the innovate budget."

Ballmer was asked whether the down economy implied that innovation would be diminished in businesses, replaced by the concept of "good enough."

"No," Ballmer said. "The truth is, you will get pushed to be efficient. Which means you are going to take the cost out of some things [that] you're doing today to do new things -- innovative things -- for tomorrow."

About the Author

Kurt Mackie is senior news producer for 1105 Media's Converge360 group.