Gates’ Efforts as Management Guru Misfire in New Book
If Microsoft Chairman Bill Gates played technology visionary in his 1995 bestseller, “The Road Ahead,” in his latest book he takes on a new role as management guru.
Since Gates is arguably the richest, most successful executive ever, businesspeople around the world will no doubt pick up “Business @ the Speed of Thought” (Warner Books) to hear his advice.
The book is built around Gates’ notion of the “digital nervous system,” the corporate equivalent of a human nervous system. Gates argues that the system, built of networked computers, should enable a company “to perceive and react to its environment, to sense competitor challenges and customer needs and to organize timely responses.”
It’s an apt metaphor, and Gates is right when he argues that companies must do a better job of getting a proper return from the hundreds of billions of dollars spent on computer technology.
Only by collecting the correct information and distributing it broadly throughout the corporation, he argues, can employees have access to the data they need to make specific proposals to improve performance.
The nervous system must also pass bad news up the management chain. Offering rare insight into his dogged attention to detail, Gates says he is suspicious when he gets e-mail about some sales victory.
“I’ve found there’s a psychological impulse in people to send good news when there’s bad news brewing,” Gates writes.
But Gates’ push for management guru status comes just as Microsoft is making a major push to sell the profitable database and networking software that are core components of any digital nervous system. Although details of Microsoft’s offerings are in the appendix rather than the body of the book, the book nevertheless often reads like very sophisticated promotional material.
Gates writes, for example, about how he was blind to the early importance of the Internet. In 1993, Microsoft’s Internet site was three computers on a folding table, with duct tape holding electric cords in place, which a fire marshal tried to shut down as a hazard.
An e-mail campaign by a few Internet enthusiasts in the company created a “firestorm of electronic deliberation” that finally resulted in Microsoft’s dramatic commitment to the Net in 1995. E-mail, Gates suggests, was the critical catalyst.
But in “Competing on Internet Time,” scholars Michael Cusumano and David Yoffie argue that Microsoft’s real success came from identifying Netscape Communications as a threat, copying and improving its browser technology, then using all the marketing power Microsoft had at its disposal to crush the company.
Gates’ tendency to place so much importance on digital sources of information is particularly ironic, given his own focus on the importance of face-to-face meetings, the reason he insists on keeping most of his employees in physical proximity on the Redmond, Wash., campus.
When Gates advises readers to “stay in the mainstream” so they can benefit from $15 billion in research and development by personal computer makers, that too seems self-serving. He never touches on Linux, a sophisticated operating system that is available for free and may be a potential competitor to Microsoft’s Windows, or Java, a software system that is popular among large corporations because it allows software to be written that can run on multiple computers, not just those sold by Microsoft.
Business readers will find useful Gates’ descriptions of the practical ways in which Microsoft has used technology to solve its business tasks. A system that allows distributors to place orders electronically for Microsoft products has reduced errors in the process from 75% to zero and now handles $3.4 billion in business. Virtually all paper forms, whether for ordering supplies or hiring new employees, have been replaced with electronic processes.
Such digital systems can vastly increase efficiency. They can also be impersonal. In describing an electronic system for handling temporary workers, Gates talks about dealing with “invoices” from “vendors” of temp labor and designing a system to cut off the temp’s access to “the network, e-mail, phone and buildings” on the worker’s “termination date.” Such attitudes have contributed to dissatisfaction among temp workers, who have filed two separate lawsuits regarding their treatment.
A digital nervous system that only looks at the impact on a company’s bottom line risks missing bigger trends. Gates misjudged the widespread anger over Microsoft’s tactics that led to the Justice Department’s damaging antitrust suit.
Gates’ vaunted digital nervous system missed another important detail. While Gates boasts of putting special features in Microsoft’s browser that helps the disabled, the Web site for his book (https://www.speed-of-thought.com) leaves out simple code that would allow people who are blind or have poor eyesight to use special systems that either increase the size of the text on the page or convert it to voice.
“If Gates is trying to propose a new way of running business electronically,” says Jakob Nielson, an expert in software usability, “he shouldn’t act like he can’t be bothered with people who are blind or have reduced eyesight.”
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Times staff writer Leslie Helm can be reached via e-mail at leslie.helm@latimes.com.
