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Like so many big tech companies, Microsoft started out as just a couple of guys in a garage. Back in the 1970s Bill Gates and Paul Allen conceived a small start-up called Microsoft. The rest, as they say, is history. The latest chapter of that history however is set to draw to a close in the near future. Steve Ballmer, the CEO of the world-changing — and for many world-defining — company called Microsoft has announced his retirement.
The Microsoft share price jumped upwards on the news, unlike when Bill Gates announced his resignation. The market clearly knows that which will become clearly apparent over the next few years. We need to understand that Ballmer was a Microsoft man through and through. He travelled that highway as the right hand man of Bill Gates for many years, and when he finally took over nothing much changed.
Having met Ballmer at Mobile World Congress in Barcelona and seen him at many CES Las Vegas keynotes, he was a very unlikely suspect to lead a monster as big and important as Microsoft. He looked, moved, and spoke like your kindly uncle. He had few airs and graces and little pretense. He also did not project power like so many top CEOs. This was a man who clearly got the job done with no show or ceremony.
Getting the job done was perhaps the best strategy post Gates. The Microsoft corporate culture has become steeped in technology and geekery. Microsoft, led by Bill Gates, rewrote computing and as a result, society. Microsoft went on to dominate the world of technology completely, this continued right through to 2010. Ballmer’s leadership ultimately did little to rock that boat.
Under Ballmer’s steady hand Windows rose and fell and more recently, with Windows 8, stumbled again. However, deep behind the scenes Ballmer took a desktop company with a public face of the iconic Windows PC and redirected as well as expanding Microsoft into becoming a deep and powerful enterprise company, offering key services, such as exchange, along with other newer offerings, such as Azure. These products now dominate the business world globally.
Ballmer’s low-key, almost self-effacing, Microsoft steered clear of the brash customer pleasing antics of its rival Apple, and continued to please its shareholders and staff with steady profits and good returns. Ballmer grew the revenue in critical areas, mainly enterprise with Office and other key business focused offerings. There were minor scuffles with rivals, but the face of Microsoft was mature and dominant.
What the market saw and what Ballmer appeared not to, was that the computer revolution that Microsoft helped create had moved on. Along with Intel, a key partner in the success of the desktop, and then the laptop PC, Ballmer ignored and then downplayed two sweeping forces, mobility and the consumerisation of technology.
Apple, which had been a tiny thorn in the side of Microsoft for many years, saw this coming and rewrote the book on consumer facing technology. What Apple got about technology in 2007 was that people had got used to being able to use tech to do lots of things, and now wanted the services and convenience of technology to come to the fore.
Technology was no longer dominated by hardware and software, but services, and critically, what those services could do for you. Microsoft under Ballmer remained defiantly a software company, a super successful and hugely innovative one, but this positioning in the market almost forced it into the back office and out of the public’s eye. Ballmer was however able to ensure than this steady transition to enterprise remained profitable.
Microsoft is now at a significant crossroads. The entire computing continuum from server farms to smartphones is at an inflection point. We are precisely where Steve Jobs recognised Apple was six years ago. We are clearly at the intersection of “Liberal arts and technology” as Jobs clearly articulated in 2011. Computing has become personal and accessible. It is in the palm of our hands via a smartphone, it is on the coffee table in the lounge or bedside stand, via a tablet. Tech departments have to adapt to this pull from consumers who lead the charge. Software became apps and we downloaded them billions of times.
Processor speed, memory capacity, and all the arcane terminology of the “Wintel” era has faded into the background of what we could actually do with our new toys. Apps and services along with new form-factor computing devices now dominate in 2013, and will continue to do so going forward. It is no longer “technology” but how society actually operates, just like modern plumbing. We rarely ask why it works, we just assume that it does, and will continue to do so.
Ballmer was the face of the huge grey battleship that Microsoft best came to resemble. It was not in any way the cool, skinny jeaned hipster of the new era. Slow and steady was the mantra, with a couple of side-show events like Windows Phone, and more recently the failed entrance into the tablet world that was the Surface tablet.
Microsoft has created, led, and managed a technologically based revolution over the last 25 years, but the writing on the wall for the Ballmer led Microsoft, came when Jobs swept the consumer from under Microsoft’s feet. Under Jobs’ leadership, Apple rewrote the playbook for tech, he threw the standard MBA playbook out the window, and created a revolution for consumers and technology, a revolution that is gathering steam as we speak.
It is not that Microsoft does not have the intellectual capacity and capability to compete in the new world of agile consumer focused technology, it just doesn’t have the corporate culture to do so. Ballmer at the helm kept Microsoft steady. Technology and software remained key, “Reimagining” things became the way of the future, but reimagining was no longer good enough. People did not want reimagined old software, they wanted a new paradigm of interfacing with technology. Backwards compatibility and legacy software has now become a noose around the collective Microsoft neck.
Ballmer led this, saw this, and could not, or perhaps would not, move fast enough. Despite all the resources, capabilities, research facilities, and intellectual capacity extant at Microsoft, it could not change fast enough. Microsoft has finally, in mid-2013, realised the writing is clearly on the wall, and reorganised the company to focus on devices and services.
Microsoft really should have moved into devices and service five years ago, in order to have caught the wave of change. Ballmer will now leave with the unfortunate reputation of the man who missed the boat. While the Microsoft battleship sailed its steady course, the nimble corvettes and millions of one-sail sailing app ships picked up all the winnings.
At the intersection of liberal arts and technology, it’s not the tech that counts, it’s what we can do with all this stuff. It takes a completely different perspective to look at technology from the view of the user.
Microsoft now needs a new visionary leader. One who does not steer, but who can lead by articulating a path forward in what we all clearly see in the transformed future of computing and technology. Ballmer, for all his competence and leadership of the biggest technology change agent of the modern era, that is Microsoft, is not this man. His legacy will live on as the admiral of a huge, powerful, but ultimately inward looking, fleet of consummate technologists.