Microsoft’s new leadership: Is tech embracing diversity?

The RootFebruary 11, 2014 

A remarkable aspect of Microsoft’s announcement of new leadership last week is that hardly anyone brought up the issue of race. Yet the biggest software company in the world will now be led by an Indian-American chief executive officer and an African-American chairman.

The announcement that insider Satya Nadella, 46, will become the third CEO of Microsoft was greeted positively by most observers. The native of India has headed the company’s fastest-growing business: cloud computing, which gives customers online and on-demand access to computing power and storage. The hope is that Nadella will instill more risk taking and innovation, qualities that have been lagging at the 39-year-old Redmond-based company.

Moving into the board chairman role formerly occupied by Microsoft co-founder Bill Gates is 64-year-old John W. Thompson, one of the least-known — and most successful — black corporate executives. In 1999 Thompson, who spent 28 years at IBM, took over Symantec, a middling antivirus software maker best known for its Norton Utilities. In 10 years he grew sales from $632 million to $6.2 billion, taking Symantec to the Fortune 500.

For most of his tenure, Thompson was the only African American heading a major technology company. He was definitely a risk taker, making three acquisitions worth more than $1 billion — including a controversial $13 billion merger with storage giant Veritas that was later written off — during his time at Symantec. He is currently CEO of Virtual Instruments, a fast-growing Silicon Valley company.

It’s clear that Microsoft has a strong, highly qualified management team in these two men (and Bill Gates will still be lurking as technology adviser). The irony in these appointments is that Microsoft, like most second-generation tech companies founded in the 1970s and 1980s, has never been very good at diversity.

In 30 years covering tech companies, I rarely interviewed a senior manager at Microsoft who was not white, and when I did come across a nonwhite employee (almost always male), he was usually Asian. And like other tech companies, Microsoft executives explained that they were simply hiring the best, without intending to suggest, of course, that blacks and Hispanics couldn’t make the cut.

By contrast, IBM, one of the first generation of technology giants, has long been a standard setter for finding, hiring and promoting minority talent. Thompson rose to vice president at Big Blue with responsibility for billions of dollars in U.S. sales and services before taking over Symantec. The current IBM management team includes Rod Adkins, the African-American senior VP for corporate strategy who previously headed the $18 billion systems and technology group, and Jacqueline Woods, the global VP for systems software and growth solutions. And IBM has had a white female CEO, Ginny Rometti, since 2012.

Thompson’s low profile has been consistent. In the years I covered him, he never much liked the media and rarely spoke to reporters. In a rare interview when he was CEO of Symantec, he made it clear to me that he didn’t want to dwell on the issue of race.

“Yes, I’m black,” he said. “Let’s move on to more interesting stuff.”

Like a lot of African-Americans in visible roles, Thompson wanted to be recognized for his achievements, not his color.

Microsoft has struggled to make a dent in the booming mobile-device business, in social networks and in music. Unlike Apple, Microsoft has not been very good at making “cool” products. But Microsoft is much more deeply embedded in the global economy than Apple.

Microsoft products like Windows are not as visible or sexy as the latest iPad or iPhone, but the company plays an important behind-the-scenes role in products from corporate email systems to point-of-sale terminals to airline entertainment systems. As Microsoft looks for growth, Nadella may well seek the advice of his chairman, who knows how to make a big company even bigger.

Does having two men of color at the top mean that Microsoft will start to look more like an increasingly brown and black America? For years, Silicon Valley companies have argued that the scarcity of blacks and Hispanics in their ranks reflects the low number of science and tech grads in those communities. But tech companies also employ people in sales, marketing, logistics, content development and communications, and they haven’t done much to diversify those areas, either.

It would be unfair to expect Thompson to single-handedly take on the burden of improving diversity in a company that faces a number of other significant challenges. But I would be surprised if he didn’t raise the issue in the course of his duties.

Despite their limited presence, African Americans have played key roles in Silicon Valley’s history. Roy Clay built the first computer lab for Hewlett-Packard in the 1960s. Frank Greene, who died in 2009, was one of the first microchip designers, and Gerald Lawson created the first video game console in the 1970s. Silicon Graphics, whose powerful workstations were the key to movie special effects in the 1990s, based its technology on the Stanford University doctoral research of African American Marc Hanna.

Third-generation tech companies like Facebook, Google, Twitter and Yahoo have also done a poor job of recruiting black and Hispanic talent. Unaccustomed to federal regulation, many of these companies have pleaded with the U.S. government to exempt them from having to file EEO-1 forms, through which companies report the ethnicity and gender of employees. They say that the percent of minorities and women they employ is competitive information, and they have fought off efforts by news organizations to obtain the data through Freedom of Information suits.

I think the reluctance to reveal the numbers is mostly because they’re embarrassing. When top executives at these companies begin to believe that their continued success requires a truly diverse workforce, the numbers will begin to improve. Until then, appointments like Nadella and Thompson will be welcome exceptions.

Joel Dreyfuss covered the high-tech industry as a senior editor at Fortune and as editor of several tech publications, including PC Magazine and Red Herring. He wrote this for The Root, an online source of commentary from a variety of black perspectives.

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