Replacing Ballmer with Nadella was possibly the best move a company's board of directors & shareholders have made in the history of corporate governance
I haven't been following MSFT closely for a while. What are some of the major decisions that Nadella has made to help create this great success over the past 6-7 years?
It's honestly that simple.
The thing I probably find most impressive is that they have been able to do so well as a business while basically losing mobile--which I'm not sure I would have thought was possible.
That one move by a board directly caused the biggest positive shift in a corporation's fortunes I can think of.
Still, Balmer was driving the company off a cliff with his brutish orthodoxy. Nadella transformed the company based on new assumptions about positioning in the modern digital economy, not the desktop days.
Now the same friends admit that there is a lot improvement in this regard since Satya came on-board.
[1] https://images.squarespace-cdn.com/content/v1/500e2d14e4b042...
Some examples:
He ditched Windows Phone in favor of Android.
Microsoft had built amazing Office apps for iOS but Ballmer refused to allow their release. Nadella green lit them immediately.
He deemphasized Windows releases. Windows 10 was supposed to be the "last" version (no idea what happened after that tbh).
Everything Microsoft has released in the last few years has been cross-platform and cross-browser. This seems obvious now but would have been unthinkable a decade ago.
He doubled/tripled down on Azure.
Internally, he ended inter-division silos and forced teams to cooperate. Lots of old school execs were booted because they refused to give up control of their "kingdom". Engineering teams were also encouraged to use Linux and other non-MSFT tools and to open source their products. Culturally it was big to have an engineer at the helm again rather than a pure business type.
1. Github acquisition: With already dev-tooling play they have, there is a clear strategy here. I think this will serve them well.
2. LinkedIn acquisition: Not sure how it is faring.
3. Friendly relations with open source projects: It improved developer mindshare
- VS Code as gateway drug
- Linux as first class integration
--
I would like to see
- Office on Ubuntu
- Open version of Active Directory
office 365 for large complex excel sheets with bloomberg terminal plugin - nope
MS just tries to embrace, extend and extinguish ubuntu(linux)
They are basically IBM in the 1970s/80s. I give them 20-30 more years and they will become irrelevant.
Linux doesn't need Microsoft help to be extinguished, the GPL haters will take care of that.
I don't see how this was a success. They stopped spending money on creating a new platform, but that's it.
I think it's not so much major decisions that Nadella did right (although he did, with cloud, open source etc.), but small decisions, day in day out for years, to transform the absolute behemoth that Microsoft was into what it is today. Both technologically and culturally. Very few companies of that size have been able to successfully steer their ship in a new direction while not suffering immensly in the process.
I think balmer got to be the fall guy for a lot of things and that was why he was put in as CEO
Ballmer did start Azure though, which is basically carrying Microsoft today. Their Surface product was also released under Ballmer's direction.
This is analogous to Xerox experimenting with GUI and not really believing in it. No real drive, no zeal. Satya doubled down on it. Made it priority 1 and most importantly executed it well.
Ballmer's world view was completely different which was more rooted in 90s and early 2000s. He was more of Windows guy and not really seeing the changing trends. That is why MSFT's foray into mobile looked like an after thought.
Saying the windows phone was half assed is being generous
IDK if I'd go that far. I used my Windows phone right up to the bitter end of it's ability to function.
The app ecosystem itself sucked, but the platform was IMO better from a sandboxing standpoint, and frankly every Windows Phone 8/10 device I had was better experience from a 'phone' standpoint. Things other than phone/email/music/navigation got bad quick. But I loved them as phones.
I enjoyed using Windows phone.
The UI isn’t even particularly pretty, but in most senses it’s pretty reasonably designed and, very importantly, extremely responsive.
I'm not sure I agree. They needed to get past a Windows-centric mindset just like Intel would have needed to get past an x86-centric one. But it's not clear to me why Microsoft couldn't have built off of a very large developer and user community--and enterprise buyers--to have at least played on a somewhat equal footing to Google and Apple.
Meego, Linux, Qt.
Insanely good developing experience, a decade ahead what iOS or Android had.
It could have been the efficient, user friendly open source rival to the Objective C and Java.
They literally missed the opportunity to make a decent and open phone and it was all by design. They killed Nokia on purpose, right when the N9 was released.
The biggest blame lies on the Nokia management board and the bonus they promised Elop, when he managed to sell the Mobiles business unit.
Fully agree with the development experience though, with C++/CX and .NET Native, with the current state better not even bother, though.
How do you explain Intel completely missing mobile?
Without 80's and 90s Ballmer, Microsoft would be a totally different thing and it's very possible there would not be a Microsoft today. And I don't care for any of these assholes, but he was very important for Microsoft and shaped the industry, like it or not.
Worth posting - Microsoft almost passed[1] on Nadella, first during his recruiting interview and later during his CEO interview[2].
[1,2] - in rush now, but will post links later, if someone asks about them. Sorry
- GOOG has grown nearly 300% (last 5 years). It is by far the strongest performing large tech stock this year (>+50%).
- They just announced one of their best quarterly earnings in their history (highest quarterly revenue increase in 14 years).
By these metrics, Sundar seems to have been a great pick. If not for the above metrics, how would you evaluate the CEO?
Is there a single major tech compagny that has lost valuation?
IBM stock was at it's peak 10 years ago. Sure, now it might seem a bit ludicrous to put MSFT in the same category as IBM, but 10 years ago Microsoft was far from sexy and not part of what people would imagine would be the future of tech (There is a reason there was no M in FAANG when that term appeared). IBM and MSFT where in the same category back then.
Now, since Nadella took over 5 years ago, Microsoft image has completly changed. And over the past 5 years, while all the "FAANG" have increased in value indeed, they have not increased equally.
Microsoft has increased the most, even more than Apple. Who would have bet on that? It has grown about 50% faster than Google and 2x faster than Facebook.
And when you say that they all have increased in value, their is a strong survivorship bias in there, you are only thinking about those companies that are still performing well today. We forget about Nokia, HP, Blackberry etc. That where big back then, but couldn't transform themselves. Just has everyone predicted Microsoft would not be able to.