Home » Microsoft survival » The Empire Reboots — Can C.E.O. Satya Nadella Save Microsoft? | Vanity Fair, Oct 27, 2014

The Empire Reboots — Can C.E.O. Satya Nadella Save Microsoft? | Vanity Fair, Oct 27, 2014

Prerequisites (June 2015⇒):

Welcome to technologies trend tracking for 2015⇒2019 !!! v0.7
5G: 2015⇒2019 5G Technologies for the New Era of Wireless Internet of the 2020’s and 2030’s
Networked Society—WTF ??? v0.5
Microsoft Cloud state-of-the-art v0.7
• Service/telco for Networked Society
• Cloud for Networked Society
• Chrome for Networked Society
• Windows for Networked Society

Opportunity for Microsoft and its Partners in FY17:

As progressed since FY15:

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2010 – the 1st grand year of:

3.5G...3.9G level mobile Internet
• system-on-a-chip (SoC) and
reflective display technologies

Why viewed most (till Feb 1):

Marvell SoC leadership
Android 2.3 & 3.0
Hanvon's strategy
Welcome! or Home pages
Treesaver (LATELY #2!) and
IMT-Advanced (4G)

Core information:

First it is EXTREMELY important to understand Microsoft [new] CEO’s Global Strategy
[CNBC YouTube channel, Oct 20, 2014]: CNBC’s Jon Fortt speaks to Microsoft CEO Satya Nadella about where he sees strength in the global economy and how it impacts their international strategy.

Nadella was born in Hyderabad, India. His childhood was an exercise in managing dissonance. “My mom was a professor of Sanskrit, and my dad was a Marxist economist. They were two very contrasting personalities,” he says. “They had their ideological wars, and I got to ignore both of them. It was a fun upbringing, I would say.” (Both his parents still live in India.)

Note that with such an upbringing is more than funny that he got a one-time retention stock award of $79.8M recently.

In addition to this here are a very few other excerpts from the VERY long Vanity Fair article with links to in-depth and other posts of mine (from last week) explaining additional things:

Over the last decade, as the biggest force in tech history hurtled toward irrelevance (albeit lucratively), a few blamed Microsoft’ s woes on founder Bill Gates, while most pointed to his successor as C.E.O., Steve Ballmer. Bethany McLean charts the breakdown of their relationship, the growing dissatisfaction with Ballmer, and the challenges and opportunities facing its third C.E.O., Satya Nadella, as Gates returns to the fold.

When I ask them what excites them most, Nadella looks at Gates. “You want me to start?” “Sure,” Gates replies. This is, says Nadella, “a great world. It’s not lost on a few other people who are capable of exploiting that world. But the thing . . . what is scarce in all of this abundance is human attention. And whoever does the best job of building the right software experiences to give both organizations and individuals time back so that they can get more out of their time, that’s the core of this company—that’s the soul. That’s what Bill started this company with. That’s the Office franchise. That’s the Windows franchise. We have to re-invent them. . . . That’s where this notion of re-inventing productivity comes from.”

“Is software the most exciting industry in the world?,” Gates says, taking up the thread. “Absolutely. You know, when it comes to vision, speech, handwriting, screens that are going to be pervasive, that are going to let you navigate information in rich new ways, in ways that you understand your customer, what’s going on with your products. . . . We’re not even a third of the way towards empowering workers even to the dream that goes back to the start of the company.” He adds, “The opportunity is pretty incredible. And the original idea of having great software people and broad software products and Office being the primary tool that people look to across all these devices, that’ s as true today and as strong as ever.”

“The way I think about success is our relevance,” says Nadella.

[The Past]

Steve Ballmer on leaving Microsoft, relationship with Bill Gates: “We’ve dusted-up many times”, on His Biggest Regret: “doing hardware earlier [for being] more effective in phone business” AND on Amazon: “They Make No Money.” [this same blog, Oct 25, 2014]

Steve [Ballmer] will never get the credit he’s due,” a former executive says. “He was brilliant—brilliant—in finding ways to harvest more money from Windows and Office.”

“He [Bill Gates] didn’t know how to let me be C.E.O., and I didn’t know how to do it,” says Ballmer. At the urging of both their wives and Microsoft’s board of directors, the two men patched things up at what Ballmer calls a “really awkward, terrible dinner” at the Bellevue Club in early 2001. It was like My Dinner with Andre, Ballmer says, referring to the 1981 film in which two old friends slowly realize they have radically different worldviews. They officially made up, and Gates turned the company over to Ballmer. “I’m not going to need him for anything,” Ballmer told The Wall Street Journal when Gates finally left completely. “Use him, yes, need him, no.”

Many people liken the relationship between Ballmer and Gates to a marriage. “It is like couples that get divorced and hook up again,” says someone who knows both men. “Trying to explain the relationship from the outside is a waste of chronology.”

Ballmer often said that he wanted to stay as C.E.O. until his youngest son graduated from high school, in 2017. But he says today that that changed. “I always think more like a shareholder than a paid C.E.O.,” he says, pulling out his performance review from 2010, in which he told the board that his target departure date was “no less than three years, but no more than five”—in other words, between 2013 and 2015.

The discord between Gates and Ballmer, both of whom were still on the board, did not make for a pleasant search for a new C.E.O., although, in truth, it might have been difficult anyway. Just consider the other ingredients: Disagreement over whether the new C.E.O. needed to be an engineer. Disagreement over whether or not an outsider was needed. A board that felt it had been in thrall to the former C.E.O.’s for far too long now wanting to exert its own control. A former C.E.O. who could not brook not being in control of what he still considers his company. And the incredible difficulty of finding a person who both could and would want to run Microsoft.

The funny thing is that Gates, who has been passionately committed to his foundation, didn’t step away from his former company. Instead he decided to step back in. Not for roughly one-third of his time, Gates says. “We say 30 percent,” he corrects. “He deeply believes he can bring something to Microsoft that no one else can,” says someone who knows him well.

Will Steve Ballmer go quietly? He did go, but it remains to be seen how quiet he’ll be. He says he has seven big things he’s doing, including learning Hebrew, getting in shape, figuring out his civic duties, running the Clippers—and managing his stake in Microsoft, which he says is 65 to 70 percent of his net worth. He has no intention of selling, partly out of loyalty and partly because he thinks that Microsoft is a good investment.

The Nadella Era

For the current in-depth assesmentMicrosoft is ready to become a dominant force in cloud computing with superior cloud offerings, a Windows ecosystem under complete renewal, first signs of Surface-Lumia-Xbox successes on the market, and strong interest in technology partnerships by other industry leaders [this same blog, Oct 24, 2014]

Nadella, despite his long career at Microsoft—and his similarities to Gates—is in fundamental ways a break from the past. He has had his executive team read Nonviolent Communication.(The title speaks for itself.) He’s a genuinely nice person, with a wide smile that cannot be faked. He is liked by people who have worked for him, by his peers, and by those who were above him. “Everyone likes Satya,” says one former Microsoft executive. “You cannot dislike Satya. Bill loves him. Steve loves him. Satya is clearly a morally good person.” “You want to get behind him,” says Greg Sullivan, who is the director of the Windows Phone division.

He quotes Nietzsche and other philosophers, but his real love is poetry, because “poets can take perhaps any philosophical point or any point of life and can compress it into a few lines,” he says. T. S. Eliot and Keats are among his favorite poets, and he also enjoys Urdu poetry. “Growing up in India, once you started engineering school you really don’t have any liberal-arts education,” he says. “Somehow I got hooked onto saying, Look, the one good way to renew yourself is to read good literature and good poetry . . . and I think my mom’s been a great influence on it.”

Part of why Microsoft failed with devices is that competitors upended its business model. Google doesn’t charge for the operating system. That’s because Google makes its money on search. Apple can charge high prices because of the beauty and elegance of its devices, where the software and hardware are integrated in one gorgeous package. Meanwhile, Microsoft continued to force outside manufacturers, whose products simply weren’t as compelling as Apple’s, to pay for a license for Windows. And it didn’t allow Office to be used on non-Windows phones and tablets. “The whole philosophy of the company was Windows first,” says Heather Bellini, an analyst at Goldman Sachs. Of course it was: that’s how Microsoft had always made its money.

De-Windowsifying movement started in China [this same blog, Oct 28, 2014]

“Holding our breath until we turn blue is not going to change the world” is how a former Microsoft executive sums up Nadella’s moves. “It’s not the world we wished it were, or the world we thought it was. It is an example of Satya embracing the world as it is.”

Embracing reality is also a huge change at Microsoft, where some joke about the “reality-distortion field.” As one explains it to me, life under Ballmer, and to some extent even Gates, was “‘Let’s get on I-90 and drive to Hawaii! We’ve got beer, we’ve got snacks, it’ll be great!’But then you say, ‘Oh, wait, you can’t get to Hawaii on I-90.’They say, ‘Yes, you can! It’ll be great! Let’s go!’” As this person says, “It can be really good but also really freakin’draining.”

“I’m pretty excited about what’s going on in Office,” says Gates, who describes his new role at Microsoft as “way more intense” than his old role as board chairman. “The open-mindedness to some new things is there. And you can say I should have pushed harder for that in the years before—anyway, now Satya’s putting resources on that.”

But as well respected and well liked as Nadella is—and as different as his style is from Ballmer’s or Gates’s—there are still questions about how radically different his Microsoft will be. Within the company, it has almost become a cliché that he was the “safe pick”: that he will stick with the status quo, whether in keeping the consumer businesses or in reshaping Microsoft’s executive ranks, which, as several people point out to me, are filled with employees who thrived under Ballmer. “He’s not Genghis Khan when you might need Genghis Khan,” says another former Microsoft executive about Nadella. There’s a Game of Thrones- like feeling inside Microsoft right now as people wait to see who will stay and who will go. But most of Ballmer’s senior executives still have their jobs.

“The thing you’ve got to remember is I grew up in a Microsoft where Bill and Steve were there,” says Nadella. “If there’s anything that I know it’s how to get stuff done with Bill around.”


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