Robust Adaptive Strategies

Robust Adaptive Strategies - Managers can form populations...

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Managers can form populations of strategies by using lessons learned from complexity theory and evolution. In 1988, I was wandering the floor of Comdex, the computer industry's enormous annual trade show and could feel a palpable sense of anxiety among the throngs of participants. Since the birth of the IBM PC six years earlier, Microsoft's DOS operating system had been the de facto standard of the industry, and the stability it had provided had led to explosive growth for the entire industry. But by 1988, DOS was beginning to show its age, and the big buzz on the floor of the show was "Are Microsoft's days numbered?" Apple, then at the peak of its powers, had one of the largest, fanciest booths at the conference. Its dazzling graphical operating system made DOS look like an antique. Aggressive Sun Microsystems had teamed up with AT&T and Xerox to combat Microsoft with a graphical version of Unix called Open-Look. Across the hall, another powerful group of companies including Hewlett-Packard, Digital Equipment Corporation, Apollo, and Siemens Nixdorf had combined forces in a consortium called the Open Systems Foundation, which was pushing its version of Unix, also with a slick graphical user interface. Meanwhile, IBM was determined not to let Microsoft advance on it again. The highlight of its booth was OS/2, a product in which it had invested heavily, and which it claimed combined DOS compatibility with the power of Unix and the Mac's ease of use. There was something very curious about the Microsoft booth. First, it was by no means the largest or splashiest booth. Microsoft had been quite successful, but was still dwarfed by many of its competitors. More important, the content of the booth was more Middle Eastern bazaar than trade-show booth. In one corner, Microsoft was previewing the second version of its much delayed and much criticized Windows system, which as yet had little significant market share. In another corner, the company was pushing the virtues of its latest release of DOS version 4.0. In yet another area, it was displaying OS/2, which it was codeveloping with IBM. And across from OS/2, it was demonstrating major new releases of Word, Excel, and other applications for the Macintosh. Although Microsoft was a distant second to Lotus and WordPerfect in DOS applications, it had quickly become the leader in applications for the Mac. Finally, in a back corner, it was showing SCO Unix. SCO was the largest provider of PC-based Unix systems at the time, and Microsoft had entered a marketing agreement with the company and would buy a major stake in it a few months later. A corporate buyer standing next to me grumbled, "What the hell am I supposed to make out of all of this?" It seemed to sum up the situation. Along with the confused customers, the press was also grumbling. Columnists claimed that Microsoft was adrift and Gates had no strategy. The press also reported that tension and infighting inside the company was caused by the fact that groups on one part of the Redmond campus were furiously
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This note was uploaded on 04/27/2008 for the course MIS 301 taught by Professor Mccleod during the Spring '08 term at University of Texas at Austin.

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Robust Adaptive Strategies - Managers can form populations...

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