Mike Gilkey joined Avanade from Accenture five and a half years ago, when the company was formed through a joint venture between Accenture and Microsoft aimed at providing consulting and implementation services for applications running on the Microsoft platform. Avanade, which launched in 2000 just after the peak of the technology boom, struggled with the economy in its early years but in fiscal year 2005 recorded over $380 million in annual revenue and had more than 4,000 professionals worldwide. Gilkey, vice president and general manager, runs the West region for Avanade and also has responsibility for market development in North America, including the verticals such as financial services.
What’s so special about Avanade?
Avanade is the largest Microsoft-only partner in the world, and we have been for a couple of years. We are 100 percent focused on Microsoft technologies; there’s never any issue about where our allegiances lie. When it was founded, Microsoft senior executives were interested in a partner that would be Microsoft-centric, but able to demonstrate the return-on-investment of the technology platform in terms of business impact, so it could go into the enterprise. Enterprise customers are rarely 100 percent Microsoft, and often have to work at integrating Microsoft applications with their existing technology. Avanade understands how Microsoft technology can and should be used, and our recommendations balance technology with what’s right for the customer’s business.
Why did you choose to move to Avanade back when it was a new venture?
I started my career with mainframes and then spent time in large UNIX environments. I remember very specifically going through the analysis of looking at what was going to happen if the same economics that were driving the price of PCs down headed into the enterprise. All sorts of things that were cost-prohibitive would then be possible.
Was it a smart career move?
In the early days it looked like a glass half full debate. When we started, it was the glory days of technology, and then as the market fell apart, many of the companies we viewed as competitors ceased to exist, consolidated, or simply shrank. Avanade, by contrast, has continued to grow. We’re meeting a need that hadn’t been addressed.
Where is the move off mainframes?
It’s not unusual to find mainframes that have been in place for 20 years. One thing that motivates people to move applications off the mainframe is the large step costs. If your business is growing and you need to add another mainframe, it is a huge investment. That’s a common catalyst for re-platforming. With the new Microsoft operating systems, databases and development tools, you can re-platform applications with a total cost-of-ownership case that makes sense to the business guy. But for firms that have a core transaction processing engine just sitting down there in the basement grinding away on gear that is totally depreciated, the cost of continuing to operate it is low, and they probably have other priorities for the IT budget.
How do you work with Microsoft?
We are very close partners. We are an early adopter of Microsoft’s new technologies and we use them to run our own business – we eat the dog food, as they say in Redmond. So we get an early view into Microsoft’s product roadmap and we provide feedback to the product groups. We also provide feedback to Microsoft directly from the field when we are implementing new Microsoft products. We share IP (intellectual property).
How does that work?
We took Visual Studio into the field with large customers and provided Microsoft with feedback on where it could be improved. We also provided some standard chunks of code that went into the Microsoft Enterprise Library for common procedures such as log in and log out that are used across all development. Avanade also has Avanade Connected Architectures for .NET (ACA.NET). That’s our tool to provide a structured environment for developers. It rides on top of the Microsoft .NET environment and allows developers to leverage common code bases across our customer’s environment. About 18 months ago we offered some of that to Microsoft. Some went into the product, and some into the Enterprise Library. In addition to working with enterprise companies we have worked with major partners, such as Fidelity Information Systems, to help them re-platform applications to Microsoft.
What’s happened to the skepticism, or outright resistance, to using Microsoft in the enterprise during your time at Avanade?
Five years ago when we were out with larger customers, we faced a lot of questions. They wanted proof points. But I don’t see that concern any more for the customers we deal with. Everyone has accepted the fact that Microsoft is here to stay, and that its products can be useful in large-scale production systems. Fallout from the tech wreck was that a lot of marginal players fell away and now there is a two horse race across technology and development platforms – .NET and J2EE. We still encounter skepticism around the scalability of Microsoft Dynamics applications for the enterprise, such as Microsoft CRM, but through benchmarking of versions 1.2 and 3.0 we’re able to prove to customers that the product is capable of supporting over 3,000 concurrent users. We’re in the midst of implementing CRM for a private wealth management division of a major investment firm – a system that will be set to support over 1,000 users across the globe.
What’s the biggest change you see from Microsoft on Intel or AMD?
The power of what you are buying is increasing much faster. But beyond the sheer power, the more interesting aspect is what people can do with the applications. In the financial services world, look at SQL Server 2005 and business intelligence. All of a sudden you have a bunch of tools that can be used by administrators and business managers who can interface to the data and SQL’s analysis services through Microsoft Word and Excel. The actual data has been available for a long time. Now all of a sudden you can have access through Word and Excel. It’s not just the price point coming down, but the use of information stored in the database is growing astronomically. More people will use it, and they will use it more frequently, and since they can access it themselves, they will see the information when it is fresh and can support real-time or near real-time decision-making.
What’s ahead?
A whole raft of Microsoft products is releasing this year, and these products are just going to accelerate people’s adoption of technology. Not only can Avanade help implement Microsoft technology, we also help customers maximize the value of their IT investment and create solutions that help generate revenue and reduce costs.
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