Monday, March 10, 2014
By Ryan Nakashima
The Associated Press
(Continued from page 1)
Microsoft announced Tuesday, that Satya Nadella will replace Steve Ballmer as its new CEO.
The Associated Press
“You have to have people who are willing to release their convictions and try something new,” McKenna says.
The company has already begun the shift — with a reorganization launched in July that Ballmer called “One Microsoft.” And in November, the company eliminated the bell-curve performance review system that rewarded workers for outdoing their peers. It was an acknowledgement that the tactics that helped Microsoft grow into one of the world’s most dominant software companies isn’t working anymore.
What’s often required of companies that have hit their peak is a leader who is analytical — rather than driving and expressive as Ballmer was — especially when trends point downward, says William Klepper, a professor of management at Columbia Business School.
Microsoft’s stock price peaked in 1999 and the wave of success the company rode on the back of its Windows operating system for personal computers is ending, he says.
“What they need to do is start their ‘second wave’ thinking,” Klepper says. “That takes patience, due diligence and a deep dive to do that kind of thing. That is very much in the style of both Nadella and Gates.”
Nadella has already indicated that innovation will be key for Microsoft, and in another collaborative turn, he asked Gates to increase his time at the company to help plot future strategy, to which Gates agreed. Nadella has said repeatedly since being named CEO that the technology industry “doesn’t respect tradition.”
And he has been lauded by many people — including Ballmer — for having the ability to pick a strategy that makes sense.
Riverbed Technology CEO Jerry Kennelly, who persuaded Nadella to join his computer networking company’s board last March, credits Nadella with preventing the company from “taking a wrong turn.” As management was considering moving in a new direction, Nadella delivered hard-edged advice “in a way that is constructive and collaborative,” Kennelly says.
“At the end of the day, technology is all about having the right product at the right time in the right market,” Kennelly says. “The keys to the kingdom are your product strategy and your market strategy, and that is where Satya has been helpful for us.”