Wal-Mart Supply Chain as a Model for Producing Software?

On the 30th of August, Tom Friedman came campus to talk about his book The World Is Flat: A Brief History of the Twenty-First Century by Thomas L. Friedman.  I don't read a lot (due to time) but this was a book I knew I needed to read.  There are two things in this book that I see a demand for every hour of every day at Microsoft as Windows Installer PM. 

Microsoft needs to embrace two of the underlying principles to Mr. Freidman's dissertation.  First is the idea of disaggregation but I'll leave that for another time after I finish the book.  Second, the idea of the Wal-Mart supply chain.  In my view, this is the root behind the Wall Street Journal article: Battling Google, Microsoft Changes How It Builds Software

Listening to Bill and Steve, the core value proposition to Microsoft was high volume, low cost model.  This worked historically because of three factors: hire smart people, Moore's law, and savvy business.  Over the last 5 years, the law of large numbers has started to eat away at the share price and the talent pool.  What does Microsoft need to do to correct this?  As I read the dissertation from Mr. Friedman, I see two things, supply chain and disaggregation, that will transform Microsoft and, what I believe, will make it the first company in the world with a Trillion dollar market cap.

First, Microsoft should use it's own workflow software, Windows Workflow Foundation, to capture it's coding supply chain.  Second, Microsoft should use it's own business modeling software, Microsoft Dynamics, to model the roles that are in our software company.   Third, the roles in the model will be laid out and accounting will be done to assign values to the nodes and arcs.  Forth, efforts to disaggregate will kick in such that tasks will be shreaded and reassembled (for another blog).  Finally, insert supply chain to part out the shreaded work for reassembly in Redmond (just like Boeing).

This shift is needed because today software is hand-crafted in the Northwest, much like Northwest beers, coffee, retail, and music.  The challenge of hand-crafted is that ever piece is unique, much like the crystal my wife loves.  Every piece is unique also means that every piece is at least slightly imperfect relative to the other pieces in the set.  Given the interconnection of software, it's a lot of work to make every piece of software tollerent to the imperfections in every other piece of software.  How does one make this transition?

Boeing managed this transition first by relying on talented machinists but then retooled for the 777 to reduce it's dependency on humans to the design phase.  The dreamliner now exploits the investment of the 777 to disaggregate the work and reassemble based off a world wide supply chain.  Over the years since Microsoft joined the Dow Boeing has at times approached the Microsoft lows relative to the average but the dreamliner has caused a 100 point rebound.

So why Wal-Mart and not Boeing as the model?  Wal-Mart is high volume and low cost where Boeing is high cost, low volume (relatively).  Couple this point of view with the hiring of the our COO from Wal-Mart and the cards are on the table.

This is a very exciting idea for me because, as a setup guy, I live at the "check out counter" end of the software supply chain.  I see a lot of stuff experiance tells me that should not have shipped.  I can only do so much clean-up after the fact.  WiX is just one step in forming a feedback loop that will allow the software supply chain to be disaggregated and reassembled. 

I can't wait for this reinvention.

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