The digital imperative for every organization

The following is an excerpt from my remarks at our annual partner conference, Microsoft Inspire, this morning.

Over the past few years, we’ve talked extensively about digital transformation, but today, we need to go beyond that, from talking about digital transformation to delivering on the digital imperative for every organization. The time is now. It’s what will make the difference between organizations that thrive and those that get left behind. Every organization in every industry will need to infuse technology into every business process and function so that they can do more with less.

The case for doing this has never been more urgent or more clear. In fact, I would say it’s existential. The next 10 years are not going to be like the last 10. Digital technology is a deflationary force in an inflationary economy. It’s the only way to navigate the headwinds we’re confronting today.

Doing more with less doesn’t mean working harder or longer. That’s not going to scale. But it does mean applying technology to amplify what you’re able to do across an organization so you can differentiate and build resilience.

And it all comes down to how we can help you – our partners – use the Microsoft Cloud to help customers overcome today’s challenges and emerge stronger. No other cloud offers our breadth or depth. And no other cloud offers not just best-in-class products, but best-in-suite solutions across the entire tech stack.

Today, I’ll highlight five digital imperatives for every organization to do more with less, and how we are creating new opportunity for our partners across the Microsoft Cloud.

Migrate to the cloud

It starts at the infrastructure layer. Leaders in every industry are accelerating their migration to the cloud, and it’s not just lift and shift. IT and OT are coming together, and the cloud is foundational to how organizations will be competitive going forward.

Every customer I speak with is clear-eyed about aligning their IT investments to scale with demand, and moving to the cloud allows them to do just that, converting their spending from CapEx to OpEx. It’s all about helping customers drive operational efficiency, deliver faster time to value, and reduce costs.

Across our offerings, we offer the best value at every stage of cloud migration. To just share two examples: it’s up to 80% less expensive to run Windows Server VMs on Azure and SQL Server VMs on Azure than it is with our main competitor. And it’s not just about costs. We offer unique capabilities to simplify VM management and SQL Server compatibility to ease your move and are significantly investing in migration and modernization programs to help customers move forward with confidence.

We’re building the next generation multi-cloud, multi-edge infrastructure to support this. It starts with Azure as the world’s computer. We have more datacenter regions than any other cloud provider, and over the next year, we will launch 10 new datacenter regions in 10 markets, spanning four continents, delivering faster access to services and helping to address data residency needs.

Today, we are going even further to help partners around the world serve public sector customers. We are announcing the Microsoft Cloud for Sovereignty, which provides policies, controls, and technologies that will enable customers to meet a government’s specific data sovereignty, security, and privacy requirements.

This builds on our innovation with Azure confidential computing, which is already helping customers bring their most sensitive workloads to the cloud. The combination of our core capabilities around confidential computing and sovereignty make our cloud unique.

And our differentiation goes beyond that. With Azure Arc, we’re bringing the power of Azure anywhere so that you can build apps with Azure services that can run across on premise, edge, and multi-cloud environments. With Azure for Operators, we’re bringing computing to the 5G edge. We have the largest partner ecosystem of anyone in the industry, helping to deliver next generation private wireless solutions. And, together with our partners, we are extending our infrastructure beyond our planet with Azure Orbital.

This ubiquitous fabric, from 5G to space, will enable a new generation of modern, connected applications that will create opportunities for our partners to transform entire industries.

A great example of this is Procter & Gamble, which last month chose our cloud to digitize more than 100 of its manufacturing sites around the world with the goal of increasing productivity and sustainability across its operations. They’re using our technology to build a new IoT platform that will analyze data from production lines, including production runs, downtime, changeovers, and more, to build the future of digital manufacturing, connecting the back office to the retail store.

Empower fusion teams

Now let’s talk about empowering pro and citizen developers, and our approach to digital and app innovation.

Today, every company is a digital company. Organizations are eager to equip fusion teams of pro and citizen developers with best-in-class tooling so that they can scale their impact together, and they are eager to adopt DevOps, which is fast becoming the default way to deploy code to production.

From Azure DevOps and GitHub to Visual Studio, we have the most complete platform and the most trusted cloud to help developers go from idea to code, code to cloud, and cloud to the world.

GitHub is where the innovation of tomorrow is being built, openly, securely, instantly, and automatically. Every step of the way, by being cloud-first, end-to-end, GitHub brings an unparalleled developer experience, and costs up to 30% less when compared to our major competitor.

With GitHub, you get the best of both worlds: affordability and scalability. Ninety percent of the Fortune 100 use GitHub today. Take Mercedes-Benz, as an example. Software development isn’t something they do on the side. It’s core to the company’s value add. 20,000 employees of the company, more than 10% of the total workforce, use GitHub as the central development platform to build, ship, and maintain software.

And with our Azure PaaS services, organizations can build modern, more resilient cloud-native applications. Azure Container Apps is a fully managed serverless container service for building and deploying modern apps at scale. We are committed to Java and are helping organizations modernize the Java application portfolios with Azure Spring Apps Enterprise, which we built as part of our partnership with VMware.

And we’re not stopping there. By 2025, 70% of new applications deployed for the enterprise will use low-code or no-code tools. With Power Platform, we have the leading business process automation and productivity suite for domain experts in every industry with 20 million monthly active users.

We’re taking a unique approach to what is an expansive and high-growth market, bringing together robotic process automation, low-code/no-code tools, virtual agents, website building, and business intelligence into a common platform for building end-to-end business solutions, reducing complexity, as well as cost. Customers can save 80% or more compared to major competitors.

Quite frankly, in this time of constraints, not everyone can invest in large complex systems, but with Power Platform, anybody can have an incredible impact in an organization. And to be clear: It’s not just one app or one workflow or one automation. It’s about accelerating digital capability-building across every function in the organization. In fact, the number of organizations building centers of excellence around Power Platform has grown exponentially over the past few years.

Globo, the biggest media and TV company in Brazil, is a great example. They have worked with our partner ecosystem to launch and run a Power Platform center of excellence:

Unify data and apply AI models

Now let’s talk about data and AI. It’s all about two things: Getting your data estate in order and applying large, AI models as platforms. That’s the dual challenge.

It’s hard to overstate the opportunity. What we are seeing is the convergence of previously disparate categories. We’re the only company that has a complete data fabric, from the operational store, to the analytics engine, to data governance with our Microsoft Intelligent Data Platform.

This is not just about best of breed. It’s about the best of suite. This allows organizations to spend more time creating value and less time integrating and managing their data estate.

Just think about the time and effort that goes into aligning your operational stores and analytics with new regulations, or just imagine the total cost of ownership if you try to do all this integration on your own. Analytics alone on our Intelligent Data Platform is about 4.8x faster and costs up to 59% less than other cloud analytics vendors.

When it comes to AI, we’re seeing a paradigm shift as the world’s large AI models become powerful platforms themselves. In Azure, we’ve built the most powerful AI supercomputer in the cloud, and we’ve used it to train large, state-of-the-art AI models.

But it’s not enough to talk about these models: it’s about applying them. We are building models as platforms in Azure so that you can apply these advances to any use case, including some of the biggest challenges we face as a society today.

Ørsted, which produces a quarter of the world’s wind energy, along with our partner, Cognite, has used our tools to turn data from its offshore wind turbines into insights for predictive maintenance:

Collaborative business process

Now, let’s turn to the next digital imperative and our approach to modern work and business applications.

Hybrid work is here to stay, and it’s clear that flexibility and wellbeing are non-negotiables as new work patterns emerge.

Technology can help us navigate this change. Every organization requires a digital fabric that connects people, places, and processes.

We’re the only cloud that supports everything an organization needs to make this shift. Think about all the hybrid work solutions your organization requires today: meetings, chat, phone, scheduling, project management, cloud storage, analytics, and automation, and the cost and the complexity that goes along with adding, deploying, and managing each of them.

Microsoft 365 brings all these solutions together into one integrated experience that makes work easier and smarter for employees. Customers can save more than 60% compared to a patchwork of competitive solutions.

When it comes to people, it starts with taking a new approach to collaboration, both inside and outside the organization. We need to be great at sync, async, in-person, and remote collaboration.

Across Microsoft 365 and Teams, we’re innovating to support all the ways people work, and today, we’re announcing exciting new features to make this possible.

We also need to prioritize the employee experience. When work is increasingly happening, anywhere, anytime, the employee experience needs to adapt accordingly. It needs to be digital-first, connecting every employee wherever they are and whenever they’re working to facilitate engagement and retention.

That’s our goal with Microsoft Viva, which is now being used by more than 1,000 organizations as their digital employee experience platform, helping employees feel more connected to their company’s mission and culture. Viva brings together communications, communities, knowledge, learning, goals, and insights right in the flow of work in Teams.

I’m so excited in particular about Viva Goals, which creates a different form of alignment across a team or organization. It brings business goals into the flow of everyday work. Think about how powerful that is: When all your objectives and key results are shared across the organization, everyone becomes aligned. Viva Goals will be generally available next month.

In the new world of work, it’s more important than ever to connect people across the organization, wherever and whenever they work, so everyone feels included and invested. It’s why we are also introducing Viva Engage, which helps employees build communities, spark engagement with leadership, harness knowledge and answers, and build their own personal networks. It includes new experiences like Storylines so you can create and share what you’re passionate about, discover and follow colleagues and leaders, and find answers to questions.

We’re also expanding Viva to include new modules for specific functions, starting with Viva Sales. We have connected Dynamics 365 with Office and Teams to harness customer and business data and use it to supercharge the systems of record. Viva Sales helps sellers capture information about what has happened between customers and salespeople across the entire Microsoft 365 suite, eliminating the burden of manual data entry. It ensures sales leaders have one unified view of activities, deals, and revenue while removing the friction of sellers keeping CRM systems up to date.

Our approach extends to where people work, in person or remote, so you can unlock productivity wherever you are. Space, in fact, is the ultimate collaboration tool. We’re not going to trade it away, but we are going to use it very differently.

With Teams Rooms, we are bridging the gap between people working remotely and those in the office with innovations like Front Row. In partnership with OEMs, we are delivering intelligent cameras designed to enhance the presence of people in Teams Rooms.

It’s also why I’m so energized about Windows 365, which is designed to help organizations empower the workforce to be more productive and connected, regardless of their location. Between Windows 365 and Azure Virtual Desktop, you have the most diverse set of options so everyone can work how and where they want.

It’s been one year since we launched Windows 365, and it’s been amazing to see how so many people and organizations are using it to power hybrid work. We continue to expand where and how Windows 365 can be used, and today, we announced that Windows 365 will soon be available for use by the U.S. government and government contractors.

Our approach to space extends to the metaverse and how we’re bringing together the digital and physical worlds. We’re taking a software-led approach so that everyone can benefit from these experiences, regardless of what device they’re on. That’s what we’re building with Mesh for Teams, which I’ve been using internally and is accessible from anywhere on any device, including VR headsets, HoloLens, tablets, phones, as well as PCs.

This secular change extends to every business process. Think about this: If Teams is where we work, we will want to access everything right there in the flow of work, giving back our most scarce resource: our time. The software required to manage these mission-critical business processes must move from traditional ERP, CRM, and supply chain management systems of record to be much more data, collaboration, and AI-first.

Teams, along with Power Platform and Dataverse, are powering this across all enterprise business applications. Leading third-party ISVs have built deep integrations with Teams, helping customers bring every business process and function directly into the flow of work.

Dynamics 365 is purpose-built for this new world of business process. Our intelligent business applications connect data, process, and teams, ushering in a new era of hyper connected business and offering unparalleled value. Customers can save up to 50% compared to our major competitors.

And today, we announced the Microsoft Digital Contact Center platform, which brings together Dynamics 365, Azure Communication Services, Teams, Power Platform and Nuance into one, open, extensible and collaborative platform to deliver seamless omnichannel customer engagement.

Siloed data systems, along with high interoperability and maintenance costs, too often get in the way of best-in-class personalized customer experience. Because our Digital Contact Center is a single unified platform, it reduces costs and allows instant visibility into trends across all service channels.

When we make everyday experiences collaborative, we can bend the productivity curve for an entire organization. It’s also why I’m excited to see so many customers and partners leverage Teams as an organizing layer for a new class of collaborative line of business applications. I believe these apps could become the biggest breakthrough drivers in today’s labor market because they bring both knowledge workers and frontline workers together in the context of their communications and drive the next level of automation and productivity.

More than 80,000 of these apps have been created by organizations in every industry. Take United Airlines which built a new scheduling solution within Teams:

Prioritize security

Now, let’s turn to our final imperative: security. The numbers are quite stark. Businesses are experiencing an increase in both the volume and sophistication of cyberattacks.

We’re bringing together technology, threat intelligence, and human expertise to provide a comprehensive security, identity, compliance, and management solution that empowers our partners to solve security challenges for customers across all industries, on any cloud and any client platform. We integrate more than 50 security product categories, once again reducing cost and complexity. On average, customers save more than 60% when they turn to us, compared to a multi-vendor solution.

Our solutions are informed by more than 24 trillion threat signals each day. It starts with Microsoft Entra, our new vision and portfolio for identity and access. It extends to Microsoft Purview, which is the future of compliance and data governance; Microsoft Priva, which includes new capabilities to help your customers manage privacy; and of course, Microsoft Defender and Microsoft Sentinel. And with Microsoft Security Experts, you can tap into our own threat researchers. Our expertise is now your expertise.

We see organizations around the world relying on our security solutions to protect some of their most mission-critical data including the International Committee of the Red Cross, which has worked with our partner ELCA, to use our technology to reunite families in the midst of a humanitarian crisis:

**

Everything I’ve talked about accrues to the Microsoft Cloud. The Microsoft Cloud is the only cloud that allows you to take advantage of both best-of-category products, as well as best-of-suite solutions across the entire tech stack, in every area that matters most to customers so that they can do more with less.

We want to be the best partner for our partners, and we are investing in your success. We are committed to helping our partners better meet customer needs by helping them gain specializations and deep technical training across all the solution areas I’ve talked about.

We’ve made it easier for partners to engage with us and drive their own profitability, which is why we lowered our commercial marketplace transaction fee from 20% to 3%, so they can invest more deeply in their own growth, and today, we’re announcing additional investments, including free access to our best-in-class developer tooling to help ISVs build and publish their apps faster.

The numbers speak for themselves: Partners who bet on us grow faster and generate higher margins, and for every dollar in revenue we generate, partners who build differentiated software solutions on the Microsoft Cloud generate $10 more. But it goes beyond that.

We want you to be successful, so that you can help the world around us be more successful. It’s never been more important to connect what we build to what the world needs us to build. This is our collective purpose.

Each year, our Partner of the Year Award winners exemplify what’s possible when we connect technology to the challenges of our customers and the world, and I want to close by sharing one story of a partner that has used our tools to make a real difference in New South Wales, Australia. With homelessness on the rise, our Partner of the Year community response winner used Power Platform and Dynamics 365 to provide better services to people in need and better visibility to policymakers: