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DATA POINTS: MICROSOFT'S PROFIT-PER-EMPLOYEE RATIO.

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It's no secret that Microsoft has pulled well ahead of most rivals in revenue per employee, but a less-watched metric--profit per employee-- has widened the competitive gap even further. Ten years ago, each of Microsoft's 8,226 employees contributed an average $56,285 to the company's bottom line; by last year, the profit ratio had jumped to $240,490 per employee, while total headcount had grown to 39,170. Except for last year, moreover, profit per employee has improved every year for the past decade, a history of consistency that no other major software company has come close to matching.

360NETWORKS chief executive Greg Maffei, a former Microsoft CFO, on his relationship with ex-colleagues: "Well, when you leave a place like Microsoft, where you work very hard and everyone's extremely committed, there's a sense you're no longer with them. You may not be against them, but you're no longer part of the family." (Quoted in Interactive Week, 9/25/00)

HEWLETT-PACKARD senior executive Debra Dunn on treating under- performing employees "humanely": "I feel there is no greater disrespect you can do to a person than to let them hang out in a job where they are not respected by their peers, not viewed as successful, and probably losing their self-esteem. To do that under the guise of respect for people is, to me, ridiculous." (Quoted in Fortune, 1/22/01)

COLUMBIA UNIVERSITY School of Business professor Amar Bhide on the popular notion that entrepreneurs are usually great innovators: "These things are a matter of fashion. In the early '60s everyone thought all innovations came from the Fords, the DuPonts, the IBMs." (Quoted in Business Week SmallBiz, 4/23/01)

NEXTEL COMMUNICATIONS programmer Vassily Patrikis on the intense scrutiny he received from New York co-op boards when he tried to buy an apartment: "I shouldn't have to prove that my income sources are legitimate just because I work in tech." (Quoted in Business Week, 4/23/01)

PEOPLESOFT president Craig Conway on success: "Business is pretty simple--it's accelerated revenue and accelerated earnings. Everything else is mumbo jumbo." (Quoted in eWeek, 4/2/01)

META GROUP chairman Dale Kutnick on the extravagant growth projections that research firms made about the Internet: "There's no question that Forrester, Jupiter, and, I suppose, to some extent ourselves made forecasts that were inflated and led people down a garden path that wasn't real, in retrospect." (Quoted in The Wall Street Journal, 4/17/01)

YANKEE GROUP chief executive Berge Ayvazian on the forecast frenzy: "We were all duped by this vision that it was only going up. We were actually criticized for being way too conservative in our estimates. We were under considerable pressure from Internet companies that wanted to use [our data] to get more venture capital funding, to make this hockey stick even steeper." (Quoted in ZDNet News, 3/10/01)

IDC analyst Dan Kusnetzky on why his research firm underestimated the acceptance of Windows 2000: "We published a rather conservative forecast, based on [end user] surveys. But it appears they didn't tell us what they were really going to do." (Quoted in Sm@rt Partner, 5/28/01)

CREDIT SUISSE FIRST BOSTON ex-analyst Lise Buyer, on her decision to abandon investment banking and become a venture capitalist: "It was one of my greatest calls as an Internet analyst." (Quoted in Business Week, 12/11/00)

IBM president Sam Palmisano on his company's aggressive plans to capture Linux market share: "It has been proven in our industry that you get ahead of the trends, not behind them. IBM is a reformed alcoholic. We were behind on client-server. We weren't behind on the Internet. And we are not behind on Linux." (Quoted in CRN, 2/5/01)

CHICAGO graffiti-removal program manager Debbie DeLopez on the "Peace, Love, Linux" logos that an IBM promotion agency painted on city sidewalks: "It's surprising that a reputable company did something like this. They certainly didn't get permission to spray-paint on public property." (Quoted in The Wall Street Journal, 4/26/01)

GIGA INFORMATION GROUP vice president Rob Enderle on Microsoft's plan to create a common online repository for consumer financial and personal information: "This particular kind of service would require the most trusted vendor. Microsoft is not well-trusted, and recent security exposures have many concluding that it is not well-protected, either." (Quoted in Interactive Week, 4/16/01)
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Publication:Soft-Letter
Date:Jun 15, 2001
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