"Unlike other companies, Microsoft never developed a true system for innovation." Dick Brass, a former VP at Microsoft, lays out in a scathing NYT op/ed how the company has destroyed its ability to "bring us the future." It's insanely fascinating.
His anecdotes, from this time running the Tablet PC division at Microsoft—you know, the kind of computer that Bill Gates believed was the future—are chilling, revealing the destructive level of competition between some divisions. For instance, someone in his group developed ClearType, Microsoft's font smoothing tech that was developed to sell ebooks, but other groups at Microsoft freaked out and actively sabotaged the project, or tried to steal it from the tablet division, which is why it took 10 years to actually make it out into the world.
His other example is ridiculous too: The head of Office believed so strongly in the keyboard and mouse (and so hated the tablet idea), he refused to develop a version optimized for tablets. Which is the exact opposite of what Apple showed last week, obviously, with a fully redesigned, multitouch version of iWork for the iPad. And it's the lack of software that doomed tablets from Microsoft.
Lastly, Brass blames a dated corporate culture that's afraid to take the risk of building integrated hardware and software products, a thought relic from the '70s, when hardware was risky. And if you look, Microsoft's best products lately are from the Entertainment & Devices division, where they've designed and built the hardware themselves: Xbox 360 and Zune HD. In fact, E&D is the one consumer division—not simply the labs—where you can safely say that innovation keeps on rolling, largely because J. Allard was allowed to insulate it from the rest of Microsoft for so long.