Markets Driven vs Driving Markets Approach

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Discuss the conflict between the “market driven” and “driving markets” approach of Microsoft. Which approach do you consider Microsoft utilizes? Customers first? Or innovation driven? Justify. By Viola Mosweu & Nkosana Nkomo Microsoft employs two approaches in being market oriented-a market- driven approach and a driving markets approach. Market driven refers to a business orientation that is based on understanding and reacting to the preferences and behaviors of players within a given market structure. Driving markets, on the other hand, implies influencing the structure of the market and / or the behavior(s) of market players in a direction that enhances the competitive position of the business, in this case Microsoft. Jaworski, Kohli & Sahay (2000:45). Microsoft during this time accepted the current behavior of players (e.g., how, when, why customers purchase a particular offering). Initially Microsoft accepted the market structure(or industry structure or value chain(Porter, 1985)which is a set of players and roles played by them) as given and did not eliminate and /or modify the roles of existing industry players because Bill Gates and Paul Allen in the mid 1970s developed the BASIC computer language for the Altair 8800 an IBM machine and the introduction of the MS-DOS operating system on the IBM personal computer(Microsoft Corporation, 2000:18-20) and the debut of Microsoft word for MS-DOS 1.0. It was this philosophy of accepting the market structure and behavior as given that predicated Microsoft to learning, understanding, and responding to stakeholder perceptions and behaviors within the technology market structure. This was a company focused on maximizing short-term return on investment. In gaining the status of being market-driven, Microsoft had to engage its customers, listening to their needs, taking a long hard look at end-markets and paying attention to customers' demands before proceeding to develop a technology platform or products was...
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