Microsoft announced last week that Satya Nadella, the former executive vice president of Microsoft's Cloud and Enterprise Group, would be the next chief executive officer. Nadella, a 22 year veteran of Microsoft, faces the difficult task of steering the $305 billion market cap company into the future while satisfying demanding shareholders. Microsoft dominates the personal computer market which is in decline. Windows is the operating system of choice for traditional PCs, but runs on less than 15% of new devices. However, in his extensive experience at Microsoft, Nadella has overseen some of their most profitable businesses.
Nadella's collegial, laid-back, and humble style stands in stark contrast to his predecessor, Steve Ballmer, who was known for his verbose and passionate approach. As an insider, he understands Microsoft's culture and understands the engineering and technical issues necessary to oversee the shift into mobile, device driven, and cloud enabled business. But charismatic leadership and technological expertise may not be enough to lead the computing giant into the future with active shareholders pressuring for a strategic refocus on Microsoft's core enterprise business in order to "unlock shareholder value".
In my opinion, Nadella's exceptional record within Microsoft sheds enough light on his ability to cultivate the dynamic, fact paced, non-core divisions including mobile and Xbox. Additionally, with the increased participation of the company's founder, Bill Gates, Nadella should be able to strategically position Microsoft for the future. He should pursue unification within Microsoft's divisions, exploiting synergies that were previously foregone, such as the connection between the home and business use of technology. Additionally, one of his first tasks will be to complete the purchase of Nokia. Then, he faces the daunting task of turning Nokia's device business around and should tightly connect Nokia and Microsoft to quickly deliver a superior integrated solution.
The future of Microsoft is unclear, and whether or not Nadella will turn around their mobile business remains to be seen. The next couple years will certainly be interesting as we see Microsoft either evolve into an interconnected organization, or remain separated with siloed culture and divisions. But the appointment of Nadella at the helm is certainly a dramatic change, and I look forward to see what he has in store.