REDMOND, Wash., Feb. 9, 2000 — Microsoft and KPMG Consulting LLC today announced they are expanding their alliance to offer services that make it faster and easier for businesses to launch and run
“dot.com”
companies. Together they are offering a solution to help companies quickly bring their businesses to the Internet, with reliability and flexibility for future growth. KPMG Consulting has created a dedicated practice called the KPMG Consulting Microsoft Dot.com practice that streamlines deployment of dot.com business implementations based on the Windows 2000 platform, the foundation for the
“Business Internet.”
As momentum builds toward the launch of Windows 2000 on Feb.17, Microsoft’s Peter Boit, vice president of eBusiness Solutions, and KPMG’s Robin Hill, senior vice president of KPMG’s Microsoft Dot.Com practice, took a few moments to chat with PressPass about their new program.
PressPass: Microsoft and KPMG have been leaders in Internet-driven business for a long time. Why have you decided to form this joint program?
Hill: The Internet is changing the business landscape, not only in the way commerce itself is conducted but in the way business relationships must evolve. Dot.coms require highly responsive business partners who can accelerate their time-to-market in a way that reliably expands their business. Time-to-market is critical in any business, but is especially pressing in the dot.com space. Generally venture-funded, dot.coms face urgent pressures to demonstrate they are meeting their goals. Likewise, these companies need service providers that do business at Internet speed. By forming a dedicated practice, we maximize our ability to be highly flexible and to help our clients respond rapidly to market conditions and to their customers’ requirements.
Boit: Dot.coms must be met at a cultural level too. Working with dot.coms involves multi-tiered relationships with venture capitalists, investment bankers, strategic partners and entrepreneurs, and an understanding of the complex interactions among them is vital. Microsoft has spent years cultivating these relationships, and now seeks to increase that commitment with the joint KPMG initiative. That is why KPMG has chosen to create a distinct operation with dedicated staff, whose sole business is focusing on the needs of this space and its unique business requirements.
PressPass: What are the advantages of this initiative to dot.com companies?
Hill : Our value proposition is to increase the chances of success for dot.com companies by enabling them to rapidly deploy e-business solutions that will grow as rapidly as they do, that help them to distinguish themselves in their marketplace, and that ensure reliability as they attain quantum growth. Seen from the venture capitalist angle, the same proposition seeks to lower risks and reduce cost of ownership. Venture capitalists tell us they have concerns about scalability and reliability of Internet solutions, and we seek to bring brand-name business and technical expertise to dot.coms.
Boit : Working with this new practice increases the chances that dot.coms will execute their business plans, and in that sense we enhance a dot.com’s relationship with investors by allowing them to demonstrate they have business relationships with companies that have proven track records and significant market momentum.
PressPass : What are some of the primary differences in working with dot.coms versus Fortune 1000 firms?
Hill : Dot.coms have a unique set of business challenges; they may require more business strategy and information technology (IT) infrastructure consulting. These firms must be served with frictionless business partners, people who can leverage years of expertise in enterprise computing and business-to-business relationships, but who also understand the new playing field. We cultivate relationships with venture capitalists, business incubators, evangelists, angels — all the various players that might touch a dot.com.
PressPass: You’ve both met extensively with venture capitalists and others involved in Internet business. What feedback do they have about Internet companies?
Hill : We hear they are concerned with the reliability and scalability of Internet business solutions. We find sometimes they feel that more diligence needs to be done in terms of defining the e-business strategies of the companies they invest in — and we can help with that — and they tell us they want to lower their risk for investing in and growing these companies. Return on investment is still the goal; KPMG has always sought to help companies succeed and be profitable. The joint initiative with Microsoft puts a formal organizational commitment to that goal for the dot.com world.
PressPass : We all hear about “Internet time,” but why is time-to-market so important in this space?
Hill : There are a variety of reasons for this, not the least of which is that dot.coms are generally venture-funded, may not yet have a revenue stream and face pressure to execute to plan. Moreover, the leadership position often goes to the first entrant in a market. Branding in the dot.com space is a close linkage of product and service, where the site itself and the services it offers are intimately linked with corporate identity and the customer relationship.
PressPass : Do dot.coms face trade-offs for rapid time-to-market?
Boit : They shouldn’t have to, and that’s why we’re here — to minimize that risk. A common trade-off for gaining Internet presence rapidly is that dot.coms may not have the scalability to deal with exponential growth rates, or may lack sufficient infrastructure to manage customer relationships as they grow and add new products or services. Windows 2000 is designed for Internet business needs, bringing a complete infrastructure for effective and rapid deployment. Our initiative with KPMG is part of Microsoft’s plan for bringing Windows 2000 to the dot.com space, combined with consulting, services and support expertise to help dot.com companies succeed.
PressPass : Is the initiative just for dot.com start-ups?
Boit : We’ll target both entirely new ventures and established companies seeking to launch dot.com businesses. The new organization will bring a full range of expertise to its client relationships, such as an understanding of the complex Web requirements of today’s businesses. Faster time-to-market will be supported by KPMG’s proven ability to deliver technology and business solutions. Scalability and richness are enabled by Windows 2000 and by Windows DNA technologies, such as seamless incorporation of handheld Internet devices that might be used in a warehouse or loading dock. Dot.coms need to deploy the Web as a primary sales, distribution, marketing and customer care platform; they need multi-dimensional, integrated business models. For them the Web is much more than a vehicle for information dissemination.
PressPass : Where will the new organization be based?
Hill : We want to be close to our customers, and initially will focus on staffing in the Pacific Northwest, the Northeast, Silicon Valley and Southern California. Plans are in place for a global roll-out as well; you’ll hear more about that in coming months.
PressPass : Both Microsoft and KPMG bring to the table strong business relationships with other
“New Economy”
players. Can you comment?
Hill : KPMG has strategic partnerships with a number of key Internet business companies, including Cisco Systems, Qwest Communications and Federal Express. Our new Microsoft Dot.com practice will have access to the broad spectrum of business ties currently enjoyed by both companies, such as the possibility of offering application and Web hosting services to our clients. Also, the new initiative will encourage knowledge transfer and training activities within the Microsoft and KPMG sales forces, so these sales forces can refer appropriate business opportunities to us for Internet business expertise and services.
Boit : Microsoft has, of course, been building momentum in the dot.com space for some time. We have a field sales force of 100 people dedicated to this market. Additionally, we have been able to build an extensive network of reliable and predictable partnerships that we can bring to bear in helping KPMG to build and deliver fully integrated solutions for dot.com organizations. This is due to our partner-centric business model, and the fact that we do not compete with our partners. These relationships span all ends of the partnership spectrum–from independent software vendors to venture capitalists to original equipment manufacturers and many other categories. We also use our consulting organization, Microsoft Consulting Services, to help partners develop even greater Microsoft competency and to selectively engage with customers and partners to help them solve business problems.
PressPass : Can you explain the Dot.Com RoadMap?
Hill : The Dot.Com Roadmap provides an essential blueprint for all phases of an e-business implementation, such as strategy, planning and support. While it’s derived from KPMG’s extensive experience, this RoadMap has been developed specifically for the special needs of dot.com companies that are building their e-businesses around Windows 2000 as a core platform. The RoadMap links products and services with business needs, provides a highly flexible framework that can be customized for clients, and defines the technical and business infrastructure from which we do business. We’ve based its development on our experience with over 50 dot.com engagements, and we’ve refined it dynamically based on real-world experience.
PressPass : The agreement between the two companies is broad and far reaching, but can you highlight any significant components?
Hill : KPMG Consulting will also create a Collaborative Development Lab that will allow customers to work directly with KPMG and Microsoft consultants. The purpose will be to rapidly deploy highly scalable dot.com businesses that take advantage of the manageability and reliability of the Windows 2000 platform. The wide range of solutions that the two companies will provide include strategy, branding, creative design, Web technology integration, marketing and dot.com hosting services.
PressPass : When will the practice be available? How much “ramp-up” time will there be?
Hill : The practice is available now and is ramping up at Internet speed. We will hire 500 professionals over the next 18 months, leveraging KPMG’s special expertise at hiring IT and business talent.
