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Xbox head Phil Spencer: 'Microsoft needed a reboot'

Xbox
Phil Spencer menioning The Legend of Zelda during his DICE 2018 speech
Phil Spencer

Xbox chief Phil Spencer opened the 2018 DICE Summit with a keynote speech. He admitted that the company needed a 'reboot'. Spencer explained the company's journey to rebuild trust between the leadership and individual teams.

Head of Xbox Phil Spencer opened the 2018 DICE Summit with a speech titled "Building a Living and Learning Company Culture".

He started off his speech by reminiscing about the first computer he got from his father - a Sinclair ZX81. They bonded by playing and writing games together.

XboxA quote by Bryan Stevenson at Phil Spencer's speech at DICE 2018Phil Spencer

Spencer admitted that "it was obvious Microsoft needed a reboot". He added that "morale had hit a low, we were all massively frustrated we kept missing big trends. In some ways, it felt like real innovation was impossible. And the in-fighting and fiefdoms were so famous, people made fun of it. Which would have been funny, if it hadn't been so true."

The company needed to change how they communicate internally and with their customers. Phil continued his keynote by saying that "everything is changing - the way we relate to each other, to our partners and even to our competitors. The way we build teams, the way we build projects, the way we commit - every single day - to making Microsoft a safe and inclusive place for all."

Spencer talked about cultural transformation and how hard and demanding it is. He said that still, four years into it "it's still sometimes incredibly slow and incredibly painful to get everyone on board, much less to admit your own biases."

XboxWide shot of the stage from Phil Spencer's speech at DICE 2018 Phil Spencer

"I'd been in the role a month when I had the opportunity to speak to everyone in the team at an all-hands meeting," Spencer recalled. "The team was in a world of pain, we hadn't done our best work with the announce of Xbox One, the product we'd built wasn't meeting the expectations of our customers, market share [was] taking a nosedive and it was painful to read all the headlines."

To top it all off, the Xbox team thought that the higher-ups had stopped listening to what the customers said they wanted. That's when Spencer decided to break some exclusive news to the team. News that the company couldn't make public for another couple of months.

Spencer saw the fact that no one out of thousands of people from the team leaked the news as a significant milestone in their journey to rebuild trust between the leaders and the team. "It was about empathy, and addressing their worries and trusting them first" he said.

XboxXbox head Phil Spencer giving his speech at DICE 2018Phil Spencer

Under Spencer, the company started to bounce back with the launch of services and products like Xbox Games Pass and Xbox One X. A bump in the road came in the form of a Microsoft party at GDC 2016.

Spencer maintains that his "growth mindset" has made it easier to hold himself accountable and see that every failure - "even and maybe especially public failure" is the best chance at growth. Even though Microsoft as a company has made progress, Phil still knows there is a long way to go:

"I think the biggest tension comes down to this: do we solve this the best we can right now, or work forever for the best solution? Did we figure this out? I think we're learning how to figure this out."

XboxPhil Spencer giving his speech at DICE 2018Phil Spencer

He called their belief in what human ingenuity can build and accomplish their quest, and added that "when we make mistakes and bump and collide into each other, the easy thing is to retreat - even deny there's a problem. Instead, we have to be humble."

He finished his keynote by asking the audience what world they wanted to build, because he knows that, regardless of the strategies or the specifics, they can elevate gaming "way beyond epic lands and legendary characters".