New brooms at Microsoft necessary for a company seeking relevance

What a week it has been for Microsoft. After a wait of many months, the company at last announced its new chief executive, Indian-born company insider Satya Nadella.

However in addition, it said company founder Bill Gates would step down as chairman, to be replaced by former Symantec chief executive John Thompson, and that Gates would return to a more active role as technology adviser for Microsoft.

For all those who have been arguing for years that the technology industry desperately needs to promote and ensure diversity at the highest level within its companies, Microsoft is now an exemplar company.

At its helm is a smart and capable Indian, while overseeing the whole enterprise at board level, the widely respected African-American John Thompson brings with him an excellent reputation in Silicon Valley (Thompson was already a Microsoft board member and he led the search for a chief executive officer).

At the same time, this moving about of high-level pieces on the chessboard raises questions. The most obvious is whether Nadella, who had been heading the enterprise and cloud division within the company, is the right person for the chief executive role in a Microsoft whose corporate profile has been on the wane for years now.

On the plus side, Nadella wins high praise from many commentators in many quarters for his intelligence, breadth of capability, team approach, and past ability to move Microsoft into some challenging new areas, principally, cloud computing.

On the other hand: cloud strategy and platforms alone are not necessarily the core of what a company the size of Microsoft should be about.

Consumer to business
Tech's leading companies now have more than a platform and services; they have ecosystems that arc across consumer to business markets (think Google, IBM and Apple). They also have strong mobile and internet strategies (ditto).

Microsoft has come late to a number of these significant areas. Indeed, it has generally come late to all kinds of things; one could argue it has been the company’s modus operandi ever since it launched Windows.

A harsh critic might even say that without the extraordinary good luck of ending up with the only operating system for most personal computers in the 1980s – as bad as Windows initially was – the Microsoft empire would never have been.

It is definitely the case that once the company had the massive leverage of Windows sitting on most of the world’s home computers, as well as a major portion of the business market, it didn’t need to be overly innovative or introduce groundbreaking products.

It just needed to be good enough.

Microsoft has always been a bit of a copycat, although often a deeply impressive one, able to direct a lot of corporate might behind promoting new products or features.

It would not have the reputation of a visionary company or a company with a fresh outlook or one that defines where we might be going next, as opposed to where we have already been.

Given how fast the market changes now, many feel that Microsoft needs a highly creative visionary. It also needs somebody who is good at business.

Deep-thinking technologists, like deep-thinking American presidents, often are not the leaders who succeed. Nadella also has never actually run a company, although he has business degrees.

Practical experience
Will that matter, when he has had the practical experience of holding numerous managerial roles within Microsoft, including running one of its largest visions? Maybe not. But it would be a serious challenge for a highly experienced business person to take on the leadership role at a company the size of Microsoft, much less someone with no experience of such a role in the past.

One other concern, expressed by many, is to wonder exactly what influence Gates, in his advisory role, will have. On one hand, it’s a good thing to have him step down as chair.

However it would seem he is going back into a very hands- on, inside the company role (as he said himself). Gates is well known as a strong personality with strong views – and Microsoft is his baby. He will want to be listened to, not function as some elder statesman has-been.

New guidance
Yet the whole point of getting a new chief executive officer is Microsoft's need for new guidance, new ideas and some new directions. Yes, its cloud strategy is core to the company, but it will be a much diminished Microsoft if that becomes its primary focus.

For Microsoft watchers, the new leadership mix is definitely going to be interesting. Hopefully, it will also be revitalising at a point when the company urgently needs to prove that it remains relevant.