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Microsoft not undercutting its partners, CIO says (Page 2)

Yes, a "limited number" of Microsoft customers are outsourcing some of their IT operations to Microsoft, CIO Ron Markezich says. No, Redmond is not out to challenge IBM Global Services.


Buildup of Microsoft IT staff not planned

Markezich said Microsoft's role in the Energizer contract is to provide desktop automation capabilities for the company's desktop infrastructure. The work

Microsoft CIO Ron Markezich

is handled remotely by Markezich's IT staff in Redmond, the same group tasked with managing Microsoft's 300,000 internal desktops. No new staff was required to handle the Energizer contract and no staff expansions are planned to handle future contracts, he said.

For the services contracts that will be signed with customers in the next year and a half, Microsoft has already issued requests for proposals (RFPs) to IT partners for similar work.

Markezich said the Energizer contract provides Microsoft with direct customer feedback, something the company covets as it develops the next generation of Windows. "This is something we're not marketing because it's not like we're looking to sign up a whole slew of customers," he said. "It's something we're being very selective on.

"Energizer met the criteria, and it wasn't around the upgrade cycle. They already had SMS [Systems Management Server] deployed. They were kind of the right size where they weren't super complex. … We also wanted to do it now, so what we learn can get built into the Longhorn wave."

IT pros outsourced to Microsoft

On the sensitive issue of outsourcing, Markezich was asked about the industry implications of IT professionals losing their jobs to Microsoft. An unspecified number of workers were let go by Energizer when it outsourced desktop services to Microsoft.

He couldn't speak for Energizer, he said, but Microsoft has "done a lot of consolidation across our infrastructure" and wherever possible, the company tries to shift workers into different departments.

I think eventually, for a lot of reasons, Microsoft will be more deeply in the services game.

Joshua Greenbaum, Enterprise Applications Consulting


"As a CIO, [and as a company,] we want to be an adaptable organization, and we want to adapt with the business," Markezich said. "If the business grows or changes, or our focus shifts in priorities, I want to make sure I have people that I can move into new lines of work that are in line with my priorities."

The long-term future for IT services

Enterprise Applications Consulting's Greenbaum said that on the surface, Microsoft's early work in providing IT services directly to

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customers is simple. "It's a great feedback mechanism for Microsoft -- and one that they desperately need."

It could, however, lead to more if the software company is successful. He said Microsoft would be "crazy" to mount a challenge to a powerhouse such as IBM Global Services too quickly, but that's not to say it won't happen in the long run.

"They don't need to make that kind of leap [right now]," Greenbaum said. "I think eventually, for a lot of reasons, Microsoft will be more deeply in the services game. One day they may look more like [IBM] Global Services than they'd like to."

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