Democratizing Hyper Intelligent Automation: Microsoft’s Automation Story

Praveen: Hello, everyone, and welcome to this new episode of the Zinnov Podcast’s Hyper Intelligent Automation series. I am Praveen Bhadada and I lead the Digital Transformation and Private Equity practice at Zinnov. I am very excited to be here today and very delighted to be hosting today’s session. Automation has been a hot topic over the last several years, which gained even more prominence in the wake of COVID-19.

Automation, in its several avatars, has been leveraged across several different verticals to combat some of the worst effects of the pandemic. The automation space is further heating up with the entry of tech giants and the accelerated growth strategy that they are leveraging to gain a firm foothold. To help us gain perspectives on how the automation space will shape up over the next few years, I have with me today, Charles Lamanna, Corporate Vice President at Microsoft. Charles is an industry incumbent, who has witnessed and pioneered the evolution of the automation space. Charles incepted MetricsHub, a cloud performance management start-up, which was eventually acquired by Microsoft in 2013. And since then, he has held a number of key engineering management and product leadership roles within Microsoft. He currently leads the low code application charter at Microsoft, including the much-revered Microsoft Power Automate platform.

Charles, welcome to this episode of the Zinnov Podcast, and it’s really great to have you with us today.

Charles: Thank you for having me, Praveen. I am really excited for the discussion. Lots of great things to talk about in the automation space these days.

Praveen: Absolutely. And thank you once again for being here. Let me just get started with the automation space and the larger macro-dynamics there. This space has been abuzz with acquisitions and VC investments gaining momentum over the course of the last several quarters, and more specifically, in the last year. Perhaps Microsoft created the buzz when you announced the Softomotive acquisition and the story started unfolding around your focus on this particular industry. So, I’m really keen to get started by asking you – what prompted Microsoft to shift towards the automation space? What are the different things that you’re trying? In general, I think it’ll be great if you can help our listeners unravel the Microsoft automation story.

Charles: Absolutely. So, what we noticed and what we heard from our customers was that automation is at the heart of how you think about modern workplace productivity, as well as how they think about business applications. And so, it just kept coming up. And we kept hearing feature requests around what was Microsoft Flow at the time, as well as the rest of the Power platform, which started to pull us towards going deeper and deeper into the automation space and make sure that we have a first-class comprehensive automation offering. So it really started and ended with what we’ve heard from our customers over time as to how so much is built at Microsoft.

And there’s a whole bunch of reasons and trends in the industry, like just a growing demand for applications and digital solutions, as well as a shortage of developers and a shortage of IT professionals, which really cause our customers to be so hungry and have such a big appetite for automation solutions. So, when we look at why or how Microsoft should enter the market, we like to always make sure that we have a really unique and valuable perspective for our customers.

And when it comes to automation, there are three core things that we kind of wrote down as our principles when we launched Power Automate and entered the space. The first being that we believe very strongly that automation should be cloud-first and cloud-native. What we’ve seen in the past is that a lot of automation solutions were either only desktop applications or on-premise server-based offerings. But we believed that no matter what happens, the automation solutions of the future will be cloud-first because that makes it so easy to get started, that makes it so easy to govern what you create. It really gives you the scale, flexibility, and agility that all our customers expect. It is no different than what we see in basically every other software category.

The second item is that we believe that automation is going to be low code in nature. This is just like what we’ve done for the rest of the Power platform – with Power BI, Power Apps, and Power Virtual Agent. We believe that automation should have a development environment that’s accessible to everybody. Whether you’re a business user, an IT professional, or a professional developer, you can use a low code solution to get started and get value. And that dramatically increases the potential audience of the automation solution.

And the third one – and it’s definitely not the least important one – is that automation is going to be a lot more than just UI automation. In the past, one of the big trends in the market has been robotic process automation, which is historically very centered around UI automation and Windows-based automation – that’s necessary, but insufficient to really enable the automation and efficiency that our customers crave. So, things like API connectivity and AI capabilities, like natural language understanding, or document understanding, are all going to be key ingredients in the future of automation. So those are our three core vision items.

And that’s why the Softomotive acquisition made tons of sense and that’s why our customers have been so excited and so delighted about adding that to the Power Automate family. So, as we look to the next few years, we think these principles are holding true based on what we’re hearing from our customers, and we’re very excited to see where the market goes.

Praveen: Great. Thank you for that insight and the three-pronged principles on which Microsoft is really unfolding the automation strategy, Charles. I think, picking on those principles, Microsoft has traditionally been focusing on pro-code, pro-developer products where they are consumed by a lot of IT professionals and developers across the world. And over the last several years, you have continued to make progress, you acquired GitHub, which is now part of your suites and products, and then all of a sudden, you have this messaging around low code/no code platforms, and the whole talk around the focus on citizen developers and things like those, right? So, from a customer perspective, do you intend to combine these pro-code, pro-developer products, along with these low code/no code capabilities? How should one think about Microsoft’s evolution from a developer-centric company to a citizen developer-centric portfolio, that you’re creating a buzz about in the market?

Charles: Yeah, so what’s really interesting is our worldview is that there’s a spectrum of developers. On one end we have citizen developers, that’s no code, low code. They’re not computer science. They’re not coders, or they’re not trained in how to actually do professional development. But they still want to create things. And then on the opposite end of that spectrum, you have people who want to write code, deploy to Kubernetes, or build Azure Machine Learning models, and more advanced things like that. And that whole spectrum is a family of developers that we want to enable. And one of the great things about working at Microsoft is that we don’t have to actually choose between pro code and no code or low code. As a company, Microsoft supports all kinds of development, all kinds of developers. And we just focus on having the right tool, for the right job, for the right person, for a given task. And then our job is to go make sure that all of that is seamlessly integrated.

So we really talk about this entire developer toolchain at Microsoft, where if you’re a business user, you can use Power Automate, to automate tasks or Power Apps to go build a web or mobile application. But if you’re a professional developer or a coder, you can go deploy to Azure web apps or Azure Functions that host your service. And in all cases, you can wire it up with GitHub or Azure DevOps or do your development on Visual Studio code. And this idea that it’s not no code, low code, or pro code, but instead, it’s no code, low code, and pro code working together with the right tool, for the right place, is a really important viewpoint from us. And we talked about this as having no cliffs, which is this idea that there are no cliffs in between the different types of developers. Because the reality is, it’s not as black and white as you’d think between what makes a coder and who’s not a coder. And the best way to support everybody that’s involved and everybody underneath the same tent and build that coalition of developers is to make sure you can seamlessly move left and right on that spectrum of development. So I say, we’re absolutely going to keep focusing really in every aspect of this to your question around pro developers and low code/no code citizen developers.

Praveen: Got it, and just picking up on that a little bit more, Charles. You know, when we look at the market, when we look at some of the peer companies of yours, companies like IBM, Google SAP, everyone seems to be talking about the space. And then there’s this other breed of RPA-centric companies like UiPath and Automation Anywhere, who are also claiming to build these sophisticated capabilities, AI-centric capabilities, Pro-code capabilities on top of the platform. And we also understand that many of those RPA-centric platforms are now also collaborating with some of the tech giants including Microsoft. So, in your worldview of automation, where do you think the industry is headed? Who do you think of the two categories – tech giants versus RPA-centric companies – would find the most amount of traction as we go forward?

Charles: So, the first thing I’d say is, automation is so critical to the modern workforce, and I think everybody’s realizing that and that’s why you’re seeing so many companies entering the space because everybody’s hearing the same problems and the same challenges and the same opportunities from their customers. And that’s good. Competition is always good. It’s good for customers, it’s good for the technology itself. So it’s great news that there are so many players entering the space.

If we look to the future, there are two things that I would say future success, or basically, successful offerings for automation, will look like. The first is that it’s going to be cloud-native and cloud-first. We’ve seen this basically across every software category in the enterprise. We know this very well at Microsoft. We’re going through our own level of disruption as we move to the cloud. But customers are going to expect a SaaS, PaaS like model, which is fully managed, with instant sign up, instant provision, and instant value. They’re not going to go look for things that run on-premise. So, I’d say the cloud-first aspect is going to be key as you look to the future.

The second thing is, I’d say we’re in a bit of an RPA 2.0. phase. It’s going to be a lot more than just UI automation or workflows. What we’re going to start to see is that a true automation solution is going to have things like low code app construction, low code data exploration and modelling, case management, and routing. There’s going to be a broad set of capabilities required to really enable those automation scenarios. And that’s why at Microsoft, we frequently talk about the Power Platform altogether. Because that includes Power Apps for app construction, Power BI for data visualization and analysis, Power Virtual Agent for chatbots, and Power Automate for RPA, or automation technologies. They’re going to start to see these all in one broad platform, which is all about just making your business run more efficiently.

Praveen: And extending the idea of the cloud-native kind of way of looking at automation. While Microsoft, in your classic business, you’ve largely focused on large enterprise customers, we believe that with the Softomotive acquisition, specifically, you got access to a lot of SMB customers, mid-market customers, if you will. So, I am just very keen to understand in terms of your strategy around Power Automate and the platform, would you continue to go after the traditional large enterprise base that Microsoft is very popular with, or with this whole cloud-native premise, where there’ll be a lot of activity or interest in the SMB space as well? What are you seeing in the market today, with respect to SMB adoption of automation technologies?

Charles: Yeah, so I think what’s interesting is, for two reasons, we think that we can bring automation to everybody in the world. And I really mean everybody – individuals, small companies, medium companies, large enterprise Fortune 500. Our goal is to bring automation to everybody. And the two main reasons that we think it’s possible is because of the cloud delivery model. Because you’re not going to have someone in IT who can manage server infrastructure. If you’re a small or medium company, you just don’t have that level of support. And that’s where cloud is so key.

And the second reason is that we already include Power Automate with Office licenses today – not the full suite, but a version of it, which has a lot of adoption and usage. And a lot of those small-medium businesses and a lot of the individuals have Office subscriptions. So they already have access to automation today. And before the pandemic, we were doing some really cool things. For example, in the Microsoft retail stores, where we actually were conducting classes for small-medium businesses locally, where we would teach them how to use Power Automate to improve and run their business more efficiently. And obviously, that’s put on hold given COVID.

In general, our push is to go find ways to reach everybody. And that’s always been the strategy and vision from Microsoft – back to the original vision to put a PC on every desk. And now our updated mission statement is to empower everybody in every organization in the world to do more. We really want to go enable companies and users of all sizes and all abilities to automate tasks. Because we think it’s just going to be the future of office work.

Praveen: And assuming that automation will become a key priority next year because of the economic situation and the COVID-related scenarios. What is the roadmap plan for the Power platform in 2021? Are there any specific announcements or features that you’re particularly excited about and customers should look forward to? Give us a sneak peek into what’s in store for the Power platform in 2021?

Charles: Yeah, so I think one of the big things that we’re really focused on is, how do we continue to make it easier to govern and secure and operate a large-scale automation practice? Particularly where you have thousands of citizen bot builders, people who aren’t professional automators, but they’re building bots, or doing automation tasks, or building workflows outside of IT. How do you govern them and trust that things are operating in a secure and compliant way? And that’s been a big focus for a long time and the Power platform is going to continue to be a focus in 2021. And it may not be the most exciting aspect of the roadmap, but I would say it’s really one of the most common conversations that we have with customers as they do big Power Automate or automation rollouts at their company is how can you actually govern and control it, because it’s always about how you do the bottoms-up innovation and empower everybody going through the business process. So that’s kind of the first item.

The second item is a little more exciting. This one, definitely, I’d say, gets me out of bed in the morning, which is how we’re going to increasingly use Artificial Intelligence to help guide people to create automation. And this is really an important distinction because today in Power Automate, we have dozens and dozens of advanced AI features for things like image recognition, document understanding, natural language extraction and so on. But what we’re going to do now with AI is we’re actually going to help people identify which processes and which workflows they can automate. And then we’re even going to help them author those bots automatically, based on very advanced AI models that we’ve built. We’re talking AI models that have 100 billion+ parameters, staggeringly large AI models that we have been working on, and training on a huge corpus of information. And of course, a way that honors privacy, and so on, to make sure that we can help our customers build bots incredibly quickly, leveraging the insights we have as part of being Microsoft. So that’s one of the big areas that we’re excited about.

And then probably the third one maybe I’d call out is this growing idea of collaboration and teamwork around building bots and automation. So, things like co-authoring, where you can have two users looking at the same bot at the same time, and edit the bot together, and add comments, suggestions, and make recommendations. It will make it possible for people with different skill levels in different parts of the company, and even in different geo locations, to collaborate on a single bot. And we think this is going to be a game-changer. Because once you have these low code development environments be as collaborative as what you see inside Microsoft Word or Microsoft Excel, we think it’s going to cause a positive explosion, just emergence of a ton of great new ideas that will help improve the enterprise.

Praveen: Wow. Well, I’m truly excited about all that Microsoft will unfold next year with respect to governance, AI, and collaboration on the platform. I’m looking forward to it, Charles.

Thank you for those interesting insights that you could share with us today. It was a real pleasure having you on this one. I believe that your poignant take on the market, the competitive dynamics, and the evolving customer expectations will be particularly helpful in firming up several new trends in the automation space. And we are eagerly waiting to see how the market heats up and what defines the pole position in the years to come in this particular piece of automation.

At Zinnov, we will continue our never-ending quest to simplify the complexities surrounding the automation space. And we shall be back very soon with many more exciting discussions with the experts in the automation world. So, stay tuned everyone, and thanks for joining in. And thanks, Charles, for giving your time today and sharing your perspectives on the market. Appreciate it.

Charles: Of course. Thank you for having me, Praveen. I look forward to hearing more from you in the future.