03rd Mar 2014

So far so good for Microsoft’s new CEO, but the pressure is still on in his first 100 days.

The appointment of Satya Nadella as Steve Ballmer’s successor has been the biggest news on the leadership appointment front in recent years. And that’s saying a lot with recent appointments including Marissa Mayer at Yahoo and Mary Barra at GM! The world will be watching eagerly to see if Nadella has a successful time at the helm with Microsoft and whether he can maintain their current market share, if not improve it. Nadella’s style and demeanour is markedly different to that of his predecessor and it is unlikely we’ll see him jumping out of a cake at a company event any time soon, as Ballmer did back in 2000. Some commentators have questioned if Nadella is the right person for the role while others have claimed he has the right balance between technical knowledge and business savviness. Regardless, he will need to make an accelerated start in his first 100 days in order to keep the wolves at bay, and to set himself, and Microsoft, up for success in the long term.


Nadella joined Microsoft in 1992 and has held a number of leadership roles in both enterprise and consumer businesses in the company, including VP of Microsoft’s Cloud and Enterprise Group. Those in favour of the appointment have highlighted his background in cloud computing as a real positive, while those on the other end of the spectrum have voiced concerns over the fact that he has never led a large company. To add to the pressure, Nadella has taken over from a CEO who received some bad press towards the end of his tenure at the company for a lack of strategic focus in his early days. This must be a sore point for Ballmer. Despite generating more than $120Billion in profit during his time as CEO, shareholders have had a negative return over the period. Ballmer’s biggest failing, and something he himself has acknowledged, is believed to be the lack of strategic focus on mobile technology in the early noughties, which has resulted in the company ranking only third in the mobile market rankings today. This puts the pressure on Nadella to get company strategy right from the word go.


To add to this pressure, there have been concerns voiced over the level of influence that former CEOs, Steve Ballmer and Bill Gates, will have in the company. In this context it will be important for Nadella to make the leadership transition quickly and be seen as CEO in his own right by stepping out of the shadows of Ballmer and Gates. Central to Nadella making this transition in his first 100 days will be communicating effectively both within the company and externally to boost market confidence… and it’s clear that he is already communicating with the market and working on building his personal brand. Nadella spoke to The Economic Times last week and spoke about lessons he has learned from Ballmer. Among the “lessons learned” was an anecdote about Ballmer’s response to Nadella’s question at a performance review in recent years: “How do I compare to the two people who had the role before me?” Ballmer’s response was reportedly “Who Cares? The context is so different. The only thing that matters to me is what you do with the cards you’ve been dealt”. It’s a fair point, and we should take heed and avoid comparisons between Ballmer, Gates and Nadella (and leaders and their predecessors in general) and focus on business performance and the wider context. Almost a month into Nadella’s role, it looks as though he has prepared well for the role as all good leaders do, and he looks to be on-track for a successful first 100 days.

 

Colm Flood

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