A new type of leadership for Microsoft

Nadella’s style far removed from former Microsoft CEO Ballmer

Bloomberg NewsFebruary 9, 2014 

Microsoft’s board has chosen longtime company executive Satya Nadella to guide the once-dominant software giant into the future. The company has faltered in recent years amid the rise of mobile computing and as competitors Google, Amazon and Apple increasingly threaten its relevance. Nadella will assume the role of chief executive officer and join Microsoft’s board immediately.

MICROSOFT/MCT

SAN FRANCISCO —

Right from the start, new Microsoft Corp. CEO Satya Nadella is showing that he will operate differently from predecessor Steve Ballmer.

On his first day leading the world’s largest software maker, Nadella, a 22-year Microsoft veteran who was named CEO last week, exuded an understated calm during a less than 20-minute webcast for customers and employees. Rather than the customary news conference, the 46-year-old used the event to introduce himself and take questions from Microsoft vice president Susan Hauser.

The first line in his memo to employees started with “today is a very humbling day for me.”

That contrasts with Ballmer, who for 14 years as Microsoft CEO was famous for his oversize personality. Ballmer, 57, once jumped out of a cake at Microsoft’s 25th anniversary party at Seattle’s Safeco Field and ran through the crowd giving high-fives as if he’d won the Super Bowl. In a memo to employees last week, Ballmer said he was “pumped.”

If jarring, the change in style will be one of the advantages of choosing Nadella as Microsoft’s third CEO, said David Yoffie, a professor at Harvard Business School. Ballmer’s aggressive salesmanship during the boom days of the personal-computer industry exemplified how Microsoft became the world’s most valuable company. Now the software maker needs a new approach as it plays catch-up in areas including tablets, smartphones and cloud services. “Nadella’s obviously a deep technologist, and he’s going to bring that back to a Microsoft that hasn’t had it in the CEO office for years,” Yoffie said.

Nadella’s low-key manner also is a sign of a changing of the guard in technology, as larger-than-life founders and near-founders such as Ballmer leave the scene. As part of last week’s changes, Microsoft co-founder Bill Gates also stepped aside as chairman and was replaced by lead independent director John Thompson.

Microsoft isn’t the only technology company that has hired a product-focused CEO in recent years. Yahoo recruited engineer Marissa Mayer from Google in 2012 to be CEO, while networking-equipment maker Juniper Networks recently appointed Shaygan Kheradpir, who had built networks for Verizon Communications and others, as CEO.

“This industry goes through cycles, and we’re in a cycle where customers are looking for new products,” Kheradpir said last week. “It’s not a sales or a marketing thing right now.”

Microsoft’s decision to forgo a news conference on Nadella’s ascension also might be an effort to show that “the business isn’t about one person or personality,” said Carol Blymire, a communications consultant. “Maybe we’ve come to the end of the era of the rock-star technology CEO.”

Frank Shaw, a spokesman for Microsoft, declined to comment.

At a rally with employees last week at the atrium in Studio D, one of the newer buildings at Microsoft’s corporate campus in Redmond, Nadella demonstrated some continuity with the Ballmer-Gates era. Amid a standing-room-only crowd, Nadella appeared with Gates and Ballmer, who have been Microsoft’s only other two CEOs. Nadella emphasized the importance of software and talked about how the company is moving into devices and cloud services, according to a person who attended.

Yet Nadella also delivered a message that it was time for a change. In his email to employees, he wrote, “Our industry does not respect tradition — it only respects innovation. Make no mistake, we are headed for greater places.”

The differences between Ballmer and Nadella begin with their backgrounds. Nadella is an engineer with degrees in electrical engineering and computer science, as well as an MBA that he earned by taking weekend classes after he had started at Microsoft. Ballmer is an Ivy League-educated businessman who specialized in sales and marketing.

The dissimilarities extend into the two men’s personal lives.

Ballmer is known as a ferocious defender and rebounder on the basketball court. Nadella lists poetry as an interest and one of his favorite sports is cricket.

“He’s a thoughtful, quiet leader who rallies people around him,” former Microsoft chief financial officer John Connors said of Nadella. “He works harder than anybody. He’ll make the tough calls but he’s very urbane and civil.”

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