The List

Whoever takes the reins of Microsoft will probably have the same reaction I think anyone sworn in as a head of states does. There will be shock at what has gone on in the past. A bit of “Oh God what did I just get myself into” experienced. And there will most definitely come the realization that Microsoft isn’t a simple company.

Last week, reports leaked that the CEO search committee had narrowed its list down to a few names. Reuters reported five and Bloomberg added one along with the names of those asked but that declined.

Also last week one of the perspective candidates, Nokia CEO Stephen Elop, had some of his positions leaked to Bloomberg. Bloomberg reported Elop would if CEO concentrate on Office (a division he previously ran) and in particular push out Office for iOS and Android quickly. He also would sell off Microsoft’s Bing search engine and spinoff the Xbox division (both until late have been money losers for the company). The reception from this report and all the reporting on the search last week highlight the difficulty facing the next head of Microsoft.

The question everyone wants answered is, after who will it be, is what will be Microsoft’s direction going forth? Many analysts and some shareholders want Microsoft to dump any and all aspirations for gains in consumer computing and become a software and solutions company. The company feels it needs to do both consumer and enterprise in order to grow. Each of the suspected candidates represent aspects of this conflict, so I want to asses each chances.

Alan Mulally and Satya Nadella: The Top Picks

Mulally and Nadella, to me seem to be the most likely final candidates for the CEO spot.

Alan Mulally (68) would be the analyst pick along with Wall Street’s. He has the most experience out of all the candidates having run Boeing and now Ford. He has the reputation for cutting out wasteful products (which is why analysts like Rick Sherlund like him) and his outsider status would signal Microsoft is embracing change.

If there is a count against him, Mulally is a friend and informal adviser to current CEO Steve Ballmer; the perception that he has Ballmer’s stamp of approval could harm him. Another issue that could come up is Mulally is an Engineer by training, but not a software engineer. His lack of experience with the technology sector could be an issue. Lastly Mulally is 68 and the question of how long does he want to be head of another large company?

A Mulally pick would sit well with the Street and analysts looking for major cuts but might not sit well with those working on One Microsoft Way. I think logically given his status Microsoft should offer Mulally a seat on the Board and even the role of Chairman.

Satya Nadella (44) is currently head of Cloud and Enterprise Group at Microsoft. He is responsible for both Microsoft’s cloud computing platform (Azure) and its Server and Tools section. Basically he is in charge of the other main moneymakers at Redmond. Nadella is a Microsoft insider having been with the company in 1992. He has experience with some of Microsoft’s consumer offerings having spent time in Online Services. Nadella has been a significant part in Microsoft’s push into the cloud with Azure. 

Satya Nadella is an unknown outside of Microsoft circles. He has spent the majority of his time in the engineering trenches. His background and current job as part of the Services side of the new “Device and Services” aspect of Microsoft make him a definite contender for the CEO job. I don’t think anyone would question his commitment to pushing Microsoft further into software and services. Where I do think he will get tripped up in his inexperience running a company. Also I think he could be perceived as maintaining the status quo.

I think Nadella would be well received by the Microsoft employees and probably more importantly developers for the Microsoft platform. Out of all the names I can see Nadella working out the best.

Stephen Elop and Tony Bates: Possible but with an Asterisk

Stephen Elop (49) has the experience of working both in Microsoft (as head of the Office division) and as a CEO (for Macromedia and currently Nokia). But he has a reputation. As head of Nokia for the past three years, Elop has been praised and vilified. He was praised for writing the “Burning Platform” memo stressing Nokia needed to change tactics and culture. However he has been labeled a Trojan horse because of his decision to abandon Symbian and MeeGo and move toward supporting Windows Phone. He has also face issues over cutting down on Nokia personnel and manufacturing. Lastly the recently announced buying of Nokia’s hardware business assets by Microsoft hasn’t help win friends in Espoo.

At Nokia Elop concentrated on building up Windows Phone’s ecosystem and differentiating Nokia products. What ever else might be said of Elop Nokia hasn’t slipped in product quality. An Elop selection on the face of it would mean Microsoft means to get serious about hardware. However a recent report could see him make serious cuts into the idea of One Microsoft and at least the Devices aspects. No matter what Elop plans, his selection would be a mixed bag as his reputation. Part of me thinks he would work better as part of a new consumer division built on top of the Nokia assets, Microsoft hardware, and the Xbox team.

Tony Bates (46) is another dark horse with a tainted reputation. Currently he is a Vice President in charge of Business Development, Strategy and Evangelism at Microsoft. Before that he was CEO of Skype and was behind its acquisition by Microsoft.

Bates’ selection would bring a total X factor to Microsoft. He has some experience with enterprise (Cisco) and on services from his days running Skype. I don’t think anyone can discern from his past actions what he would do as Microsoft CEO. Given he is a part of Ballmer’s One Microsoft vision he could run with that, but I expect pushback from investors wanting the company to dump consumers. I suspect Bates won’t get the nomination but could get a larger profile.

The Long Odds:

A few names have either been said by leaks or suggested by reporters. the top two I’ve heard are Kevin Turner and Tami Reller. Both would be interesting choices. Turner spent 20 years with Wal-Mart and heads the Business Solutions side of Microsoft and is the company’s Chief Operating Officer. Reller is Vice President of Marketing and before handled the business aspects of the Windows division. Both would be able CEO’s but would also face concerns over how well they could handle the changes needed. Some names, like Tesla’s Elon Musk seem to be the wet dreams of Silicon Valley types (he said no). Then there are the former Microsofties like Paul Maritz who I think declined since he is running a new company. 

Now there are many more names. But I think these are probably the mot likely. Are they the best? I don’t know,you can never know who is the best fit until they sit in the office. Let me know what you think and who you would pick?

images: Microsoft Corp., Ford, wpmitalia.com

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