Is Steve Ballmer the Most Underrated CEO of the 21st Century?
blog.jovono.com
blog.jovono.com
This single incident perfectly demonstrates Ballmer's failures and Nadella's new vision. Had he remained at the helm Microsoft would have continued to stagnate and sink with the likes of IBM, Cisco and HP rather than stay on top of technological shifts and become the biggest company in the world.
Is there a source for this?
* their flagship OS is more and more a spyware platform
* Windows Server is pretty much a rarity these days outside of large corporate deployments. Anybody has seen MS SQL recently?
* Azure seems to have reached its peak mind share, mostly pushed by free credits
* Their gaming division mainly lives on Game Pass, while XBox is further and further away from Playstation and now there's Valve eating their lunch
* Windows on ARM, even Windows branded laptops or 2-in-1s are a niche within a niche
* What is a cell phone again?
* Edge's philosophy is "as evil and spyware as Google, but worse". In fact, Microsoft as a whole is trying to badly emulate the peak evil Google of 2015+
Ballmer made some enormous blunders and a lot of his indecision proved costly. Nadella pushed proudly forward in destroying the Microsoft name all to make a quick buck. I'll give you VSCode and Github to be good ideas, though the latter is just an acquisition, not a bonafide good product built in house.
However, generally, I could name a number of companies that descended into legacy irrelevance (not a few of which were acquired by Broadcom) but I wouldn't put Microsoft into that category at this point.
"The age of AI transformation"
“There isn’t a single industry that isn’t being transformed,” “We collectively have the opportunity to lead in this transformation.”
"All of these three things, web3, blockchain and the metaverse, are all going to happen."
Visionary Nadella here folks . Everything is transformative to this guy.
* https://qz.com/1551842/steve-ballmer-played-a-powerful-part-...
"Satya Nadella credits Steve Ballmer for pushing Microsoft into the cloud":
* https://www.cnbc.com/2020/01/16/satya-nadella-credits-ballme...
I think the biggest knock against Ballmer was not being able to figure out a (smart)phone strategy that ended up working. Having more than just Android and iOS would probably have been a better situation for everyone to be in.
For Windows proper you can release and deprecate a GUI every 20 minutes because there is always Win32 to fall back to.
But when you are bootstrapping an entire eco-system you can't muck around like that. Also strategic blunder to buy Nokia and then do exactly nothing with it.
Linux was still toxic to Microsoft. Nokia had a Linux computer which was also a phone which sold incredibly well despite Microsoft almost denying its existance, definitely not marketing it. They had to stop making it because to stop selling it. (No not "Linux" like Android is "Linux". A real Linux PC in your pocket. Imagine a Raspberry with data connection and phone.
Still would prefer a Unix like OS though. Windows is too complicated to debug.
W10-11's failures' are born of greed.
Both of which turned out to be the right move long term.
Mobile is a commoditized winner takes all market, and there's no guarantee MS would have won even if they concentrated entirely on it.
Concentrating on BI platforms helped spawn M365, and the Enterprise focus helped spawn MS Azure which had very early Product-Market Fit at the Fed because they became FedRAMP authorized well before AWS.
There's way more money in Enterprise B2B than there is in B2C.
Apple would like a word--although arguably their B2C success translated into B2B in a world where corporations increasingly didn't just dictate employee gear decisions.
But to your other point, Microsoft (though I credit this more to Nadella than Ballmer) were absolutely able to parlay Microsoft's enterprise strength to Azure in government/enterprise which AWS didn't really get at first and Google was even slower to do.
Apple's success is a form of survivorship bias.
Multiple previously massive B2C vendors like Nokia, Ericsson, Sony, HP, Dell, RiM, etc either died trying to compete in the B2C space or pivoted out as a result.
Google, Huawei, and Samsung are only able to compete against Apple because they are subsidizing their B2C ventures with their B2B product lines.
MS in the 2000s could have joined that dustbin of history as well because the old school "Windows" division was very B2C and Consumer oriented at the expense of Enterprise.
I could also name a ton of massive B2B software (to say nothing of hardware) vendors that died over time.
Yes, Microsoft basically transformed themselves from a B2C vendor (where they're now increasingly irrelevant) to a mostly exclusively B2B vendor. They're basically Azure at this point plus Office365 for their base. I wouldn't bet on the future of Xbox at this point.
so why are there rumors of MS debating not releasing next generation Xbox and switching to streaming?
Definitively not true by a huge margin.
B2C might be more prominently known, but Enterprise and B2B companies tend to make up the majority of the F1000s.
A good chunk of Teams’ backend is built on top of Skype. Not sure about the present day, but just a few years ago, you could see tons of references to Skype in the Teams’ codebase.
With that in mind, where does such confidence on your end come from?
Mobile is fun and cool and probably started a lot of HNers careers, but everyone on here seems to ignore how much more money there is to be made in the Enterprise and B2B space, and how it absolutely dwarfs B2C revenue from an effort and retention perspective.
B2C Growth Sales is a slog with a lot of variability outside of a company's control.
MS back then was in a weird transitional phase where it as a company needed to decide whether it wanted to prioritize B2C or B2B/Enterprise. Ballmer made the call to go for Enterprise and helped pivot MS away from being a B2C or B2B2C company to a company heavily devoted to Enterprise and B2B sales motions.
It was Ballmer who laid the seeds for Azure, M365, and Enterprise in general by making the "Enterprise Business" and "Servers and Tools" (precursor for Azure and MS Security) divisions much more prominent internally than their "Windows" division.
There was also no guarantee that then-resurgent Apple or new-kid-on-the-block Google wouldn't be able to eat into MS's Enterprise market share with release of the iPad+iWork and Google Apps (now Google Workspaces) respectively, and and could have tangibly done the same pivot that Amazon did in the late 2000s
Curious why Ballmer is coming up lately, did something happen with him?
The point is they won’t. This crap they’re pulling is not an oversight, they know exactly what they’re doing. It makes zero difference who they “market it” for, most people would want to do it if they opened the door.
> Right now they're not targeting such a thing to any users.
Exactly. By design. And it’ll stay that way until enough users leave Windows. Which is unlikely any time soon.
I haven't listened to this episode specifically, but I have listened to probably 20 of their other ones. It's a solid podcast, although I wish they were a little more critical and not always so laudatory.
Sometimes they get hard to listen to because they treat every company as something incredible and many of them aren't - the luxury brands episodes are completely bizarre, no idea who the target audience is for a four podcast on a handbag manufacturer.
And their SBF episode didn't age well at all - so much ass kissing. Credit to them at least for not removing it entirely.
For those unaware: https://www.youtube.com/@AcquiredFM
I've never wanted to be on a podcast in my life but for some reason I want to go on it and tell the story of how we built DigitalOcean, I feel like they would ask actually good questions. Really enjoying them.
Also true it blew a very very strong lead in the B2C business.
Warning - serious ear worm.
[0] https://podcasts.apple.com/us/podcast/in-data-we-trust-inter...
He came on a little later but Bill moved heaven and earth to bring him on to run the company with him.
He was given and incredible deal so he could be effectively an equity partner.
Steve Ballmer is underrated and did an incredible job and is to be credited with the success of Microsoft as much as anyone.
He’s one of my computing heroes.
Reporting on business issues is always muddled by a lack of proper comparisons, along with cherry picking. For example, this article makes the argument that increasing Microsoft's revenue by 4x was very impressive, even though the stock value stagnated. However, when evaluting his tenure as owner of a basketball club, he is declared successful because its value doubled. The problem is that Microsoft was eclipsed compared to its peers at the time - Google, Amazon, etc. -, and likewise the average basketball club doubled in value as well.
Mixed bag: Xbox 360 - success Vista - fail Windows 7 - success Zune - fail Windows phone - fail Azure - success
Similar story for Zuckerberg. Lucky with Facebook. Thereafter ensured he had a finger in every pie. One minute he's a bad bet with his quixotic expenditure on AR/VR, and the next minute he's a genius with his investment in AI (Llama).
At the end of the day, it pays to have your finger in many pies. Money makes money.
Sure. I don't need much convincing that Ballmer was only "bad" rather than "uniquely terrible". It seems a pretty normal thing that the negative reaction was outsized.
But I also think it would be more interesting to look at cases where the reaction by the haters was _spot on_. Or even where it _undersold_ how bad things were.
> Regarding shareholder value, Welch said in a Financial Times interview on the global financial crisis of 2008–2009, "On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy...your main constituencies are your employees, your customers and your products."[67]
* https://en.wikipedia.org/wiki/Jack_Welch#Politics
Given his actions as CEO, what he says (above) and what he actually did, there's some kind of disconnect (unless he had some kind of 'conversion' in retirement).
Perhaps when he was actually still at GE, but after his retirement, it is now know that GE did all sorts of 'sideways accounting':
* https://www.sec.gov/enforcement-litigation/litigation-releas...
So he is no longer viewed as highly as he once was:
* https://old.reddit.com/r/AskHistorians/comments/vqr30e/jack_...
What does it say about sam altman if 'winning by jack welch' is his all time favorite book.
I teach business all day every day and I only reach for Jack to teach "Fix, Sell, or Close" - In terms of clinical business he was right, in order to focus fully on the customer, the business units need to be empowered and pushed to be 1 or 2 in their given segment. They should have all the resource and time they need to focus fully on the customer problems. Out of the 70s GE had become quite unwieldy, he did a great job of re-focusing the resources where they could be best used.
I also think talking to how they engineered their finances without looking at the whole picture is a bit unfair. GE was in a bad place when he took over, it was way over extended doing a meh job generally. He surly needed cash to 1. refocus the business 2. expand research and innovation into the areas left (jets and healthcare primarily) 3. implement a large scale global expansion.
Should you do channel stuffing or bill and hold? No. Even worse: when you blur it into your reporting, that is just asking for SEC enforcement. Is there a better way to do it? Yes. Were they being sloppy? Yes. If it really was part of saving GE, should they have done it? Well, I'll leave that to you dear reader. :)
Balmer's biggest failures were mirrored by Apple's enormous success. The two areas this article calls out as Balmer's missteps were the exact areas Apple flourished in -- hardware innovation and operating system.
I don't see how you can "underrate" Ballmer as CEO given his mistakes allowed a nearly-dead rival to grow to be larger than Microsoft. The opportunity for Microsoft to capture a significant chunk of that was completed squandered.
Ballmer backed the "Enterprise Business" (precursor of Office 365) and "Server and Tools" (precursor of Azure and MS Security) divisions over the then prominent "Windows" division.
MS back then was in a weird transitional phase where it as a company needed to decide whether it wanted to prioritize B2C or B2B/Enterprise. Ballmer made the call to go for Enterprise.
There was also no guarantee that then-resurgent Apple or new-kid-on-the-block Google wouldn't be able to eat into MS's Enterprise market share with release of the iPad+iWork and Google Apps (now Google Workspaces) respectively.
Before Ballmer, it was the Windows and B2C teams that had the upper hand internally at MS instead of Enterprise.
If I recall, the team had a large hand in hindering Windows Phone up until Windows 8; when everyone was too fed up to develop for the platform.
But they're obviously doing pretty well. And, if I were an exec at a large business, I'd at least be talking to them.
It's clearly possible to be very financially successful with this kind of a pivot, while also having a lot of previous fans and customers be quite disappointed with it. An install base can increase while the user base decreases.
Microsoft is clearly continuing to find success in an enterprise space that had its addressable market grow astronomically during Ballmer's tenure.
At the same time, they went from absolute dominance in the 90s software market to having a smaller share of a much larger enterprise market today. Is that success? Maybe. Was it due to Ballmer, or was it inevitable? Also unclear.
Not by any stretch of my imagination is the man underrated. I'd say, like many American CEO's, he has vastly been overrated through a failure in capitalism.
If I do some back of the envelope calculations, a teacher makes about 50k a year, so about 2 million in a career. In his career so far, Steve Ballmer has made as much as 75k teachers do in their career. For comparison, Arizona has about 50k teachers.
Now, the man has achieved a lot, maybe even a lot compared to other CEOs. But by this measure, he must be overrated.
Ever since Bill Gates snookered Ed Roberts , Microsoft has had 'flexible' business ethics.