By now you will have heard that Microsoft has selected Satya Nadella as its new CEO replacing Steve Ballmer effective immediately. Nadella is an Indian born 22 year Microsoft veteran who most recently held therole of *Executive Vice President – Cloud and Enterprise. *Despite not being very well known publically to many outsiders, Nadella’s achievements in the Cloud and Enterprise divisions which includes Microsoft’s Windows Azure have been remarkable.
So why Nadella?
Microsoft took over 6 months to announce a replacement for Steve Ballmer since he announced his retirement back in August. So, after such a long search period why go with an internal candidate? Before we dig into that. Here’s what Bill Gates, Steve Ballmer and John Thompson had to say about Nadella.
*Satya is a proven leader. He’s got strong technical skills and great business insights. He has a remarkable ability to see what’s going on in the market, to sense opportunity, and to really understand how we come together at Microsoft to execute against those opportunities in a collaborative way.
Satya’s got the right background to lead the company during this era. There’s a challenge in mobile computing. There’s an opportunity in the cloud.
He has the technical expertise, the product experience and the leadership attributes we were looking for.
These comments collectively portray Nadella as someone with a lot of characteristics that should be in a CEO for Microsoft. As a software as well as a devices & services company Microsoft would benefit from someone with a* technical background. Being a company that has lacked some edge in some of its core product offerings Microsoft would benefit from a CEO who has *vision and can see opportunities. *For a company as large as Microsoft with thousands of employees worldwide, having a CEO that is able to *bring people together to collaborate who also understands the company inside-out is vital. It all sounds so perfect doesn’t it? I think it does!
If you’ve been following the coverage about the CEO search for the past few months you would know that among the other leading candidates in the search were Ford CEOAlan Mulally, Nokia CEO Stephen Elop and Microsoft BDE Exec and former Skype CEO Tony Bates. The main reasons for each of them were Mulally’s successes at Ford and influence on Ballmer’s leadership, Elop’s previous run at Microsoft and his work as CEO at Nokia and Microsoft’s acquisition of Nokia’s devices and services business.Tony Bates for turning around Skype, his background and also being familiar with Microsoft culture and having a non traditional look.
Looking at the competition, I think the choice of Mulally would have been the riskiest one for Microsoft. Microsoft is a pretty complex company and having an outsider take the reigns of CEO would bring along nothing but risk. As I understand, most of those who saw Mulally as the perfect candidate are the ones who wanted to see major change at Microsoft, to see big decisions …etc. Whilst Mulally could bring such change I think a change as dramatic as might have been anticipated would just tear Microsoft apart. Such change would’ve made sense if the company was in bad shape but you have to remember that Microsoft as a whole is not struggling. With Mulally aside, my view is that Tony Bates and Stephen Elop lack the diversity that Nadella has when it comes to familiarity with different parts of Microsoft. As CEO of Nokia Elop’s strength would’ve been the Devices & Services area and for Tony Bates it’s the mobile & communications area. So what about the rest of the company?
Putting aside the competition, lets look at Nadella and what he can bring to the table.
One of the main differences between Nadella and the rest of the candidates is that he is a 22 year Microsoft veteran who has worked in multiple areas of the company. This gives Nadella the edge in that he knows Microsoft inside out and is used to the goods and the bads of the Microsoft culture. Unlike Steven Sinofsky who was not known to be of the very collaborative type, Nadella is seen to have that ability by many insiders and outsiders of the company. This should aid him in pushing change to the Microsoft culture.
On top of Nadella’s experience across Microsoft in a variety of product teams he has a technical background that is fitting for a CEO of a software (and devices & services) company. Whilst Ballmer was a tech savvy CEO he was more of a business/sales guy than a technical guy. Nadella’s technical background can help him bring new ideas to the table and in knowing what works and what wont.
Vision & Ability to See Opportunities
Looking at what Nadella has achieved in the Cloud & Enterprise division, you can see that he is capable of seeing opportunities, compete with rivals, and do it well. I like this interview which Nadella did back in 2006 which shows some of his thoughts about Microsoft and working for it back then – Satya Nadella running the Microsoft Dynamics Team. In addition his first interview as CEO provides some insight on how he thinks. Further to new things that Nadella can bring to the company, he is already well established in one area which is seen by some board members as a big opportunity for Microsoft, that of course being the cloud. When it comes to the *mobile challenge *Nadella has in his team the people he can rely on.
Leadership & Product Experience
There is probably not much to say here other than that his achievements in his previous roles at Microsoft in several product groups show that he is a can do person that is also able to work effectively with others. For a company as complex and as big as Microsoft being familiar with the company and able to collaborate is likely to produce better outcomes than being Steve Job’s like and destructing the company.
Unlike Alan Mulally, Nadella is much younger and is not close to retirement so this gives him the potential of being around at Microsoft further in the future with the change to see change through. Mulally would’ve been a short term CEO at best which is not something Microsoft needed.
To me Nadella always comes across as someone with a lot of passion and energy, whilst different from Ballmer he’s still a very likable personality. Just watch some of his keynotes, interviews and conference speeches!
Most of Nadella’s experience over his time at Microsoft has been in Microsoft’s enterprise divisions and not so much on the consumer side. Contrary to what many believe, I actually think that this experience is one area that made Nadella a strong candidate for CEO. Whilst many Microsoft observers see Microsoft as a struggling company on the consumer front, as an enterprise company they are doing very well. If you’re company is good at something, wouldn’t it make sense to make what you’re good at even better? I personally think it does. To most average people out there Apple is viewed as th*e consumer *company and Microsoft the *business *company. This is why a while back I wrote the post Breaking up Microsoft. I think one of Microsoft’s biggest challenges is changing the perception of who Microsoft actually is. Some of the changes they have done in 2013 help address that but there is more to be done. I think this is where Bill Gates’ new role as Technology Adviser might come in.
Putting it all together
Being a Microsoft veteran, a person who has a technical background, a young and energetic guy, a leader and a visionary executive with a great track record, a person who can strengthen Microsoft’s core abilities and create new ones, someone who can keep Microsoft familiar yet new and a CEO surrounded by a great leadership team working with him. I think Nadella was the best choice for CEO of Microsoft and I’m happy it’s him that has been chosen. I cant wait to see what Microsoft will bring along in this new chapter for the company.
To Satya Nadella, I say congratulations on your selection. To the rest of you, what do you think?