"And yet it is failing, even as it reports record earnings," writes Brass. "As the fellow who tried (and largely failed) to make tablet PCs and e-books happen at Microsoft a decade ago, I could say this is because the company placed too much faith in people like me. But the decline is so broad and so striking that it would be presumptuous of me to take responsibility for it.

"Microsoft has become a clumsy, uncompetitive innovator. Its products are lampooned, often unfairly but sometimes with good reason. Its image has never recovered from the antitrust prosecution of the 1990s. Its marketing has been inept for years; remember the 2008 ad in which Bill Gates was somehow persuaded to literally wiggle his behind at the camera?

"While Apple continues to gain market share in many products, Microsoft has lost share in Web browsers, high-end laptops and smartphones. Despite billions in investment, its Xbox line is still at best an equal contender in the game console business. It first ignored and then stumbled in personal music players until that business was locked up by Apple."

In my column from two months ago, I argued that Micorosoft's current biggest problem is that it no longer reaches for the stars:

"There was a time when Microsoft dreamed very big dreams—and then made them come true. . . . Where is that unforgettable Microsoft fire now? Where's the audacity, the ruthless wagers, the bone-chilling certainty and will, the refusal to be anything but the leader among a big field of big alpha dogs?"

And in his op-ed piece today, Brass offers some devastating examples of how terrible a toll that shortcoming has taken on the company in its failed or waning efforts with the Tablet PC, e-books, web browsers, smartphones, Xbox, personal music players, ClearType, Web TV, and more.

Writes Brass: "What happened? Unlike other companies, Microsoft never developed a true system for innovation. Some of my former colleagues argue that it actually developed a system to thwart innovation. Despite having one of the largest and best corporate laboratories in the world, and the luxury of not one but three chief technology officers, the company routinely manages to frustrate the efforts of its visionary thinkers."

Ultimately, he says, the most damaging repercussion of the brutal and short-sighted internal politics and the lack of strong, customer-driven leadership will be the loss of the great minds that collectively pushed Microsoft to historic heights in financial success and market influence: "Perhaps worst of all, Microsoft is no longer considered the cool or cutting-edge place to work. There has been a steady exit of its best and brightest."

Brass's column offers a chilling view of Microsoft's future, but it also offers an extremely valuable lesson to every other company, inside or outside of the IT business: when your internal machinations become so corrosive that they overwhelm your focus on the world outside, no amount of great thinking or huge bonuses or market might can save you.

RECOMMENDED READING: Global CIO: Steve Jobs Is Bugs Bunny But Microsoft Is Elmer Fudd Global CIO: 5 More Things Microsoft Must Do Global CIO: The Top 10 CIO Issues For 2010 Global CIO: Cloud Computing's Deadly Vulnerability—And How To Avoid It Global CIO: Apple's Steve Jobs Torpedoes Another Stale Business Model Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

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