Project Management Institute

Microsoft enters the upper floor




This month, Microsoft® is expected to release its latest version of Microsoft Project®—the most extensive change in the software since its first incarnation. You'll no doubt find numerous reviews about the functionality of MS Project 2002 in many other venues, but the impact of Microsoft making any move with Project is significant to this industry—and I believe this version will create a bigger wave than any version Microsoft has released since the first Windows version many years ago.

New Functionality

First, let's talk about the functionality that Microsoft has chosen to focus on since the release of Project 2000. Resource management and collaboration are the particular hot buttons in the project management sector right now.

You'll find in Project 2002 completely revamped resource management functionality including global resource pools, multiproject resource leveling, skill-scheduling, team-building and more. For matrix organizations trying to match limited skilled resources to multiple projects, this will play very well. You'll also find a new attack on collaborative functionality. An upgraded Web-based interface called Project Server replaces the old Project Central and enhances the existing notification with additional functions while adding document and issue management. Rounding out the multiproject resource management functions are “what-if” and analysis project portfolio management functions called Portfolio Modeler and Portfolio Analyzer.


With more than 80 percent of total project management software licenses sold coming from Microsoft, having Project move into the high-end space will mean taking a fresh look at the concept.

Microsoft has adopted two separate functions that may be familiar to many of us. The first was the purchase of eLabor's Enterprise Project in late 2000. In what was referred to as the “warp engine,” resource scheduling functionality has been woven into Project 2002 along with the expertise that invented it. The second was the purchase of Sharepoint, which had a Web-based portal system. Microsoft has separately marketed this as Share-point Team Services. The Sharepoint architecture forms the basis of Project Server and replaces Microsoft's first attempt at a Web-based interface, Project Central.

Multiple Versions

Of course the concern with loading all of this functionality into Microsoft Project has been that the user-friendliness would disappear. Since its introduction to the market, Microsoft Project has been heralded as one of the most user-friendly project management systems ever created. It is widely credited with expanding the project management software category to non-professionals by making it so easy to start. In Project 2000, critics already were pointing to the complexity of additional features by saying that Project was beginning to lose its user-friendliness. Microsoft has countered that in 2002 by creating multiple versions.

You'll now see Project Standard, Project Professional and Project Server. The idea isn't new; many vendors have tried the high-end/low-end approach to the enterprise sale. Primavera has had P3/SureTrak since the DOS days. Welcom has Open Plan Professional and Desktop. Other vendors have had various high-end/low-end solutions for years, some even using MS Project as the low end. But there is a fundamental difference here. Microsoft already controls the desktop market. With more than 80 percent of total project management software licenses sold coming from Microsoft, having Project move into the high-end space will mean taking a fresh look at the concept.

Who Will be Affected?

The short answer to this question is everyone, but to what extent will this release affect both vendors and users? There is no doubt that vendors now are looking at the increased functionality included in Project 2002 and making their own adjustments for how to react in the market. The entry of Microsoft into the enterprise-level market certainly doesn't mean that any vendor will instantly disappear, but it may mean a change in underlying strategy for some. The enterprise-level project management systems experience for a number of vendors will allow them to compete—at least for a time—against Microsoft if they choose to do so, or allow them to team with Microsoft if they choose that route.


For organizations that already have many copies of MS Project being used at the desktop level and have a desire to implement enterprisewide project management or cross-project resource management, the announcement of Microsoft's new version of Project may mean delaying a decision on other opportunities until they've carefully examined Project 2002.

So, what does this all mean for the industry? Microsoft now is referring to Project 2002 as a “Microsoft Solution Offering.” It's a new term for Microsoft and the implication is that this is the first of what will be multiple solutions offerings from the company. A “Solution Offering” is a combination of product and services offered from a combination of vendors. Microsoft has teamed with several high-end IT solutions companies such as KPMG, Cap Gemini and Pcubed to provide multinational services—with a wide range of companies around the world to deliver local assistance with MS Project 2002 implementations.

Some people believe that Microsoft ultimately will have to enter the service market to successfully implement enterprise solutions, but the enterprise resource planning and customer relationship management markets have been operating with third-party implementers for years with a great deal of success. Bringing an entire enterprise solution into an organization drives Microsoft's influence even deeper into that organization and opens other opportunities to them.

If MS Project 2002 does find success in the enterprise-level market using this approach, then software vendors in a number of categories aside from project management will have to start thinking about whether or not Microsoft has targeted them next. PM

Chris Vandersluis is president and co-founder of HMS Software, based in Montreal, Canada. He has appeared in publications such as Fortune and Heavy Construction News, and is a regular columnist for Computing Canada magazine's project management column.

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