Leading Innovation and Change

This report explores the concepts of innovation and change in the context of Microsoft. It includes a detailed analysis of the company, SWOT and PEST analysis, innovation strategies, and change management models. The report also discusses the importance of leadership and its various styles in driving innovation and change.

LEADING INNOVATION
AND CHANGE

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Analysis of company...................................................................................................................3
Innovation....................................................................................................................................6
Change.........................................................................................................................................7
Leadership....................................................................................................................................9
RECOMMENDATIONS...............................................................................................................12
CONCLUSION..............................................................................................................................12
REFERENCES................................................................................................................................1

INTRODUCTION
Innovation is the expansion as well as application of ideas that improves the way of thinking
through which things are done or can be achieved. Innovation in the business activities can help
the businesses to grow with the help of improving productivity as well as efficiency of the
employees. The ability of employees to innovate activities helps the business firm to remain
competitive and through which they are able to respond to changes in most appropriate manner.
With the help of change, organizations lead to many positive aspects that help to sustain
company’s competitive edge and making relevant in business area (Chatzinikolaou, D., 2018).
Change encourages innovation and thus helps to develop skill and staff along with better
business opportunities.
Microsoft is a multinational technology company having headquartered in Washington.
Organizations deals in develop, manufacture, support as well as sell computer software, laptops,
and various other related services.
This report will describe the detailed analysis of innovation and change in context of
Microsoft along with its SWOT and PEST analysis, model of innovation, model of change along
with its application as well as evaluation. Apart from this, the study will also highlight the
concept of leadership, its various styles and application in Microsoft firm.
MAIN BODY
Analysis of company
Microsoft is a multinational technological firm which deals in software products such as
internet explorer, Microsoft windows line of operating system, edge web browser and Microsoft
office suite. Microsoft is the world’s largest software maker company according to revenue
generation and considered as one of the largest 5 companies which deals with information
technology industry along with Apple, Facebook, Amazon and Google (Živojinović, I., 2020).
Microsoft announces recently the change of leadership at the rudder of its company
which has sparked assumption about possible strategic directional changes within the
organization. With the help of SWOT analysis the internal dynamics as well as external business
drivers has been analysed that affect organization in its way to regain its market leadership.
Below is the SWOT analysis of the company:

1. Strengths
 The biggest strength of the firm is that it is the well known and famous brand
which has been utilized in all personal computers all over the world. The founder
of the company has a great image and the person is also renowned who are
dealing in activities related to computing.
 The association has its international system of distributors and also indulged in
co-branding with hardware producers of computers, which enables the firm to
have detailed planned acquaintance and wideness of consumer support which is
supreme.
 Another major strength of the company is that it is really very easy to use and due
to which it is highly accepted by the users for its products and thus enhance the
customer base around the world (Baumgartner, K., 2017).
 Establishment is able to again and again beat forecaster expectations in terms of
revenue generation as well as profitability.
2. Weaknesses
 One of the considerable weaknesses of the firm is that its employees are unable to
anticipate market conditions as well as phenomenon about portable computing.
 At the time of mobile computing, company missed the wave and thus also the
success of the other computing revolutionary. Company failed to come up with a
compelling smart phone as well as operating system.
 Another weakness is that company has omnipresent security flaws in its software
and resulted in crashes of windows apart from its versions that have been used by
users.
3. Opportunities
 Microsoft has huge cash collection which means that company cannot grow
through its normal growth but grows with the help of acquisition of smaller firms
that have well in their business prospects.
 Though company was unable to read the mobile computation but make their way
to get in front with cloud computing services through which the organization

becomes large in competitive world and regain its leadership position (David,
F.R., 2019).
4. Threats
 Company faces biggest threat of software stealing mainly in Asian countries
where pirated copies are more than original products.
 The large size of the company prevent the organization to being quick while
adopting market opportunities by proactively reading market signals (Rahman,
M., 2021).
PEST analysis of the firm:
1. Political: From last few years, company faces several political issues regarding to
trust factor. A country such as China has taken issues with Microsoft distributes and
sells their software. Not even China, other European combination strikes Microsoft
with a heavy penalty for destruction of faith convention. In current scenario, company
is in sympathetic location for political lobbying as from last two years; company
provides money towards the formation of political environment which states clearly
that the company wants to be at the good side of their government.
2. Economic: Just similar to all other firms, Microsoft is also exaggerated by the present
condition of the financial system. With the changes in the taxation rates as well as
labour laws, the company sees fluctuation in their profit margin as well.
Establishment also faces poor relationship among international companies which does
not allow to import as well as export goods and services (Fan, Z., 2021). During
financial crisis, company also lay off over 5000 employees.
3. Social: It is not just the economy that affects drastically the organization, but the
social factors also contribute while affecting the organization. Each and every
organization has to understand social as well as culture requirements of the business.
Keeping track of culture changes helps the organization to know current trends.
Without culture study, it becomes difficult for Microsoft to know new trends as the
company is available at multiple locations. Microsoft has not adapted smart phone
easily and in order to achieve more success, company needs to shift their thinking and
include smart phones (Bashroush, R., 2020).

4. Technology: Microsoft is a technology company. It distributes and develops digital
software. Microsoft puts large amount of funding towards innovation, research and
investments for usage of advanced technology. The company has experienced profit
growth after adopting cloud computing services.
Innovation
Innovation is the sensible application of information that results in the prologue of new
merchandise and services or further upgrading in the existing goods and services offered by the
firm. Microsoft is a technology industry which does not respect tradition and work according to
that. The company respects and work according to innovation in order to stay ahead of
technology. Each year, company invests large amount of revenue into research and development
procedure through which organization produces new and innovative software, devices as well as
services which are appropriate to excite customers as well as partners all over the world.
The concept has been described on the basis of linear innovation process model which
includes Technology Push Model and Market Pull Model (Henderson, J., 2020). Linear model
described as a model which is based on products and services are unmoving at the premature
stage in order to reduce danger. In this model, innovation procedure in enterprises involves series
of chronological phases and ladder that arranged in a way that the earlier phases must be vacant
before affecting towards subsequent step or succeed stage. The criteria in order to pass each step
are defined beforehand. The person who is guardian for innovation process must ensure and
examine that known objectives for the earlier phase have been correctly met or not and whether
required outcome or expansion has taken place at the prior period or not. This model works well
when time mandatory by the firms to innovate is shorter than rate of alter in environment. The
quality, consistency and protection desires are decisive and secure suitable for the first time
apprentice firms. This model is in general utilized for incremental improvement. It is liner in
terms that the innovation procedure is strongly inhibited and concentrated from the very early
stage towards set goals in order to control input to attain desired target. The model consists of:
 Technology push model: It is the original age group linear replica under which
equipment is regarded as key driver of modernism. In this whenever a fresh or enhanced
expertise combines, it leads to improvement of new commodities and services as well as
procedures. It involves chronological ladder i.e. elementary investigate, submission
explore, plan, manufacturing, industrialized, promotion and sales. In this model,

purchaser is treated as impulsive recipient of production i.e. it is supposed that if an
enhanced product or service which is based on new equipment is developed without
getting feedbacks or consultation, customer will recognize the product. Thus, in short
process ignores consumers’ requirements and market desires (Yin, X., 2019).
 Market pull linear model: This is the second age group linear model which includes or
integrates user requirements in the modernism process. Here, customer desires and
marketplace requests are regarded as the key driver of improvement procedure. .It
involves chronological stepladder i.e. assessing shopper requirements, thought
production, calming thought, intend, industrial, and mechanized, test, advertising and
sales.
Innovation strategy that has been utilized by Microsoft is clouds on the horizon. In Microsoft,
the innovation drivers are manufactured goods groups, Microsoft investigation labs,
improvement teams generating popular innovation at Microsoft and most importantly driven by
senior leader of the firm i.e. Gates who sent out memos for theatrical transformation in
merchandise, forces as well as technologies according to their own understanding as well as
requirement of the time along with techno logical advancements. Microsoft has put together
various innovations developed in the region and around the world. Microsoft pix which are an
sharp camera application that adjusts after shot as well as setting enhancements. Skype translator
is another innovation done by the Microsoft which breaks down language barrier by helping
users to exchange a few words in several languages for tone of voice calls and more than 50
languages in messages. DNA data storage also innovation done by Microsoft which density up to
1 Exabyte per cubic millimetre which is durable and simple to influence. 99Dots, Urban air, city
noise DiPsy and many others are the result of innovation techniques that has been evaluated in
the business activities by Microsoft (Kahn, K.B., 2018).
Change
A change is the initiative that has been introduced within the organization in order to
improve the way work gets done, take advantage of opportunities and solve problems. Change is
highly important for any business in order to lead towards positive aspects in order to retain

competitive edge. Change encourages innovation, development of staff and skills and thus leads
towards better business opportunities as well as improves employee morale.
Lewin’s change management model is one of the largely established and successful change
models. This particular model helps the organizations to better recognize managerial and planned
change. The model consists of three main stages which include: Unfreeze, change and refreeze
(Schulte, M., 2018).
Unfreeze stage is the primary as well as grounding stage where workers must get prepared
for the modification involvement within the organization. The critical step at this phase is to
improve open member of staff communiqué amplification of the requirements of change. The
goal of this stage is to overcome employees’ confrontation to change as much as possible.
Change stage is the phase in which transformation gets implemented within the
organization. Good management and effectual employee announcement are vital at this stage
which is the continual stage of first stage.
Refreeze stage is the step at which change has been accepted by the employees of the firm
and they go back to their routine work. This stage is the ever departing stage as influencers must
ensure that the changes has been adopted in proper manner and used after the change
administration objectives has been achieved.
In context of Microsoft, it has been identified that the firm was operating into solemn
trouble with its organizational arrangement. Company appoints new CEO which took blame and
started to undertake some serious reformation for this enormous company. Even after the great
success of windows and office products, Microsoft was facing or struggling to keep up with
other competitive companies specially Google and Apple. After introduction of new CEO into
the business, company undertook major reformation of the tech giant to eradicate its unhelpful
interior contest. Microsoft merchandise and platforms would no longer exist as disconnect
groups. All employees of the organization focus on set of common goals which are:
 Building of intelligent cloud platform
 Reinvention of business processes and productivity procedures
 Create more private computing
Proceeding to reformation, workers had been missing an optimistic sense of principle which
resulted in low down morale of employees and destabilized member of staff meetings. And after

restructuring all employees of the firm are following a common goal that brings real implication
to their work.
The Microsoft has evaluated the change management in their process and makes
necessary modifications such as:
 Clarifying objectives: Microsoft closely monitor their company goals and desired
outcomes of the firm by making corrective actions. Along with this the firm also
housekeeping on the outdated objectives statements that whether they are reflecting new
company’s vision or not.
 Collect e-learning feedback from employees: Collection of e-learning feedback in order
to get thoughts about the recently or current change management process and with the
help of such feedbacks, areas of improvement have been identified. The employees must
feel that their opinion counts and team leaders also offers enough support to the firm’s
management in order to provide efficient services. It also encourages group based
opportunities as well as collaboration in order to create good efforts from them.
 Get input from team leadership: Leaders intermingle with their employees on every day
basis and appreciate their exclusive requests and concerns about the imminent changes
that needs to be done within the organization and thus improves the whole procedure and
coast up online teaching strategy (Lintunen, T. eds., 2020).
 Hiring of outside partners for training requirements of the firm: Many companies lack
in necessary experiences as well as resources due to which they have to face changes and
transformation in the business processes in their future terms due to wrong decisions in
the past. Changes help the organization to cope up from their competitors. Outsider
training provider gives the organization a unique way to restart or innovate their work in
order to watch the solutions of solving the problems in cost effective manner. They help
the organization to develop new strategies and to disclose hidden gaps. Frees research
and development department so that they can focus on other things as well.
Leadership
Leadership is an art of motivating a group of people in order to act towards achievement of
common goal. In business terms, it has been connected to directing workers and colleagues with
a strategy in order to meet company requirements (Hallinger, P., 2018). Most important role of

leader is to provide clear and convincing direction to their followers and make sure that their
followers must understand and work towards the achievement of objectives.
Dissimilar operational environment command unlike styles of leadership and good leaders
combine characteristics of various changed management types in order to administer the work in
most appropriate manner. Below are the seven classical types of leadership through which the
leaders are working:
 Autocratic leadership style: In this type of style, leaders have all the power,
responsibility as well as authority within an organization. There are a very rare
decision making on the part of team instead the groups are tasked to follow the
direction provided by their leaders and they have to act accordingly along with their
decisions as well as choices. Thus particular type of leadership is very much rigid
but quick decisions have been taken due to leaders provided guidance but requires
close supervision as well.
 Charismatic leadership style: This leadership style represents influence and
inspires other people and thus the goals of the company which generally reflect the
vision of the firm. This type of leaders greatly affect the change along with inspire
people.
 Transformational leadership style: Like magnetic leaders, transformational
influencers also motivate others however; this control style does not necessitate any
organizer to be there to achieve change because the leader transforms things with
the help of institute and thus motivate employees in order to make them perform
better. This type of guidance demands high level of productivity and involvement
from employees. One drawback of this type of leaders are that they set targets very
high and also creates unrealistic expectations from their team members while
completion of task.
 Laissez-faire leadership: These selectors take complete liability for company’s
decision even though the power to make these decisions rests in the hands of the
employees. When the employees of an organization are highly skilled and
stimulated to do well and proper manner then it has been identified that Laissez
faire leadership style is successful within the organization. This type of leadership

creates lack of unity in group of company workers and thus projects may fall out
of track without strong supervision.
 Transactional leadership style: Roles of each individual are well defined and
people who are determined to do their work and react to rewards in positive manner
are likely to do well under this type of leadership. Moreover, this leadership style
establishes clear defined and well maintained structure that enables the organization
in order to meet short term goals. However, this particular leadership style does not
allow for more of innovation and creativity in employees. It follows rigid structure
that may not respond positively with the changes within the company.
 Supportive leadership: Helpful leaders hand over task to their followers or workers
along with skills required to complete the task efficiently. In this style leader’s
work through all the trouble and issues and offer high degree of concentration and
training to their employees as and when required.
 Democratic leadership style: With this leadership style, all group members are able
to contribute in choice assembly procedure. This kind of leaders emphasizes
equality and encourages conversation and flow of information smoothly within the
company.
In context of Microsoft, the leaders follow authentic as well as transformational
leadership style through which they have made the organization responsive to market
requirements and thus increase employee commitments towards the firm. This helps to deliver
the high grade of financial return to its shareholders. The leader of Microsoft believes in the
control of optimistic management and use terms such as ‘augmentation mindset’ and ‘empathy’
that are unbreakable by stroke. The leader of the firm i.e. Satya Nadella offer three things to the
organization and which every leader should create are Clarity, Energy and success irrespective of
their circumstances. Microsoft leader follows never stop learning attitude, create impact style,
ways to innovate things, be a team player and do not over control their employees are the style or
philosophy that has been followed by the establishment in order to make their whole
organization successful (Zacher, H., 2018).
The leadership style followed by the company is highly effective as this style lower down
the turnover costs, engages full volume of employees or group people, create and manage

changes effectively within the organization, new and innovative corporate visions has been
quickly formulated within the establishment, it helps to create eagerness, encourages ongoing as
well as continuous learning and development within establishment, leaders quickly able to
change low morale situations, focuses heavily on ethics, ask important questions and people are
treated as individuals with their proper evaluation of requirements and capabilities.
RECOMMENDATIONS
From the above study it has been recommended that with proper analysis of Microsoft,
organizing style with complete analysis of company with SWOT and PEST evaluation leaders
have to design teams strategically with proper involvement of innovation. Promotion of voice
and knowledge sharing also provides helps in creation of new ideas (Rauvola, R.S., 2018).
Innovative leaders establish ethical models in order to support both as well as motivate
employees. Innovation leaders introduce changes within the organization in order to enhance
organizational requirements along with personal as well as professional control of employees.
CONCLUSION
From the above report it has been concluded that changes are highly required and significant
part within an organization along with the evolution of time and requirement of changes within
the company. With the proper evaluation of SWOT as well as PEST, companies have to make
innovation and changes in their products as well as strategies in order to make businesses
successful. In making the organization efficient, the role of leaders are highly appreciated and
recognized in order to complete tasks.

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