The Advantages of the Microsoft Windows 2000 Operating System

Simon Witts President, Microsoft Canada Co. THE ADVANTAGES OF THE MICROSOFT WINDOWS 2000 OPERATING SYSTEM Chairman: Robert J. Dechert President, The Empire Club of Canada

Head Table Guests

C. Alexander Squires, Managing Partner, Brant Securities Limited and Secretary, The Empire Club of Canada; The Reverend Dean Mercer, Rector, St. Theodore of Canterbury Church; Nithya Vinayakarmoothy, Grade 11 Honours Student, Parkdale Collegiate Institute; Chris Stanley, Director, Enterprise Group, Microsoft Canada Co.; Ron Hulse, Vice-President, Sales, Compaq Canada Inc.; John C. Koopman, Principal, Heidrick & Struggles and a Director, The Empire Club of Canada; Chris Weber, Director, Small and Medium Enterprise Group, Microsoft Canada Co.; and Peter Ciceri, President, Compaq Canada Co.

Introduction by Robert J. Dechert

Just a few years ago, blissfully unaware of the Internet, most of us thought nothing of waiting for several days for our correspondence to be delivered by snail mail.

Research on most topics meant a trip to the library-and commerce was anything but electronic.

Today, we almost take for granted that information on virtually any subject imaginable is available instantly-just a few clicks away-on our desktops, laptops, palmtops or other wireless devices. And we grow impatient over a few seconds delay in retrieving information that, a few short years ago, would have taken hours to locate-if we could find it at all.

The on-line community is growing at an incredible rate. Currently, a population the size of the United Kingdom is added to the Internet community every six months.

And just as information is readily available, products and services of virtually any description can now be viewed, reviewed and purchased over the Internet.

Relatively small businesses can now reach worldwide markets that were previously only available to huge multinationals. Microsoft is developing tools to enable small businesses to quickly and inexpensively utilise the power of the Internet to enhance and expand their business. One of those tools is the new Microsoft Windows 2000 operating system. We are privileged today to be joined by Mr. Simon Witts who will explain the advantages of this new operating system.

As President of Microsoft Canada, Simon Witts leads the company's strategic management team, which is responsible for driving Microsoft Canada's long-term business direction and future growth.

Mr. Witts sits on the boards of the Information Technology Association of Canada and the Canadian Alliance Against Software Theft.

Mr. Witts came to Microsoft Canada from Microsoft Ltd. in Great Britain where he held the position of Director of the Enterprise Customer Unit and where he was responsible for Microsoft's relationships with its largest U.K. customers.

Before joining Microsoft in 1993, Mr. Witts successfully served in a number of sales management roles at IBM U.K. Ltd., where he spent eight years.

He has a Masters degree in Information Technology and a Bachelors degree in Pure Mathematics and Theoretical Physics-all from the University of London.

Ladies and gentlemen please welcome Mr. Simon Witts to the podium of The Empire Club of Canada.

Simon Wins

Thank you Bob. Thank you to the Empire Club. Thank you ladies and gentlemen for joining us for this lunch. Bob kindly gave me a book of previous speeches. It is a bit late now but at lunch I tried to work out if standing up here is good for one's career or bad for one's career. If you go back for example to July of 1996 Bill Gates stood at this podium. At that time he was Chief Executive Officer of Microsoft. Now he is just Chief Software Architect.

I will take one extract from his speech which was delivered close to five years ago. Bill said: "Whenever you have a communication device it's going to be a long time before critical mass kicks in and it becomes more than a novelty. For example, when people had fax machines the first few wondered who was going to send them a fax and a few years later everyone was expected to have one and in fact it was unusual on your business card not to present your fax number." Well the same thing is in the process of happening again. "Everyone," he suggests, "I venture to say in this room within five years will have an electronic mail address and the ability to get messages from businesses, colleagues and friends across the Internet."

Isn't that amazing? That was his vision five years ago. Obviously how people use the Internet has changed in the first five years of the digital economy. People have gone from just inquisitive usage to today when they are trying to figure out how to put almost every, if not every, process of their business on-line and on the web.

It was only 30 years ago for example that we had wage constraints and controls in Canada. We had inflation. People were out of work. It would have been difficult to predict the euphoria we now have based on the Internet. But is it sustainable?

Last week in London, Goldman Sachs did probably the best evaluation of the first five years of the digital economy. They looked at the sustainable value of the technology with quite good measures such as non-inflationary employment growth and things like that. They concluded (the study is on the web by the way) that there is indeed going to be substantial long-term sustained benefit from this new digital economy on the web. They point to GM and Ford who've come out already and evaluated that their supply chain costs will be cut by a full 20 per cent using business-to-business e-commerce techniques.

So what do we as senior business leaders need to do? Bill Gates when he was our Chief Executive Officer took a fairly individual and unique approach to that problem. One Friday night, he took home a copy of each and every paper form that the company possessed. A paper form is a good indication of where there is no electronic process and where there are people involved in the process.

The interesting thing was that most of those forms related to interactions with customers and suppliers. They weren't internal forms as you may have thought. When Bill came back on Monday and brought his business leadership team in they went through the forms and determined that the majority of the forms could be moved to the web. The process whereby Bill asked the business team and the IT team to move all those forms on to the web drove probably the single biggest re-engineering process that our company has ever experienced. It took customers, partners and suppliers directly on to the web. We started up a group, the customer systems group, that spun away from IT to do this. IT weren't seen as responsive enough and now every single transaction we have with partners, customers and suppliers is done over the web. There's no employee intervention in any of those processes anymore. And the customer systems group has absorbed the IT group. The IT group today for our company really only manages the infrastructure and defines the specific applications for the employee group, in our case 35,000. Thirty-five thousand employees is such a tiny number compared to the millions of customers, partners and suppliers we have that interact directly with our business systems, our customer systems through the web. So the cost of running Microsoft has been dramatically reduced and we've taken employees out of the process.

The reason for your being here today is to hear how Windows 2000 can help in the digital economy and webenable business in your own environment. Windows 95 and Windows 98 were seen as breakthroughs for the desktop. We think you'll look back on Windows 2000 and say it was another breakthrough on the business desktop. You'll say it's a significant breakthrough on the server in terms of scalability, management, reliability and the benefits that NT can bring to IT infrastructure, but probably most importantly you'll look back and say Windows 2000 enabled your business to go on-line. Not just to conduct e-commerce but put more and more of your processes up there.

So how does a company set about delivering one operating system that can make so many breakthroughs and so many claims? There are two answers. The first one is an awful lot of developers. The second one is an awful lot of customer feedback. Indeed from this video you'll get a flavour of just how many developers and just how much customer feedback goes into this process.

Video shown.

There was $1 billion of investment there with a team of over 5,000 people for three and a half years. Five hundred people alone worked on reliability.

We were delighted to work with four companies in Canada over the last year in a unique way. You'll see in this next video an example of Telus. I think it is quite timely that BC Telus announced a five-fold profit increase last night but I'm not sure all of that is to do with Windows 2000.

Video shown.

Thank you BC Telus.

Our expanded vision is to empower all of you on any device at any time and from any place with great software tools. That's our role. We would love to have a role in your plans to get on to the Internet. We hope Windows 2000 becomes a part of it and thank you very much for sharing our excitement today. I hope you enjoyed the lunch and thank you for letting me speak to you.

The appreciation of the meeting was expressed by John C. Koopman, Principal, Heidrick & Struggles and a Director, The Empire Club of Canada.