Steve Ballmer retires as Microsoft CEO

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The news that many had been expecting for months (or years) came today, as Steve Ballmer announced his impending retirement as CEO of Microsoft. Ballmer’s exit will come within the next twelve months, and he will help lead the search for the next leader for the embattled software giant. Rumors have swirled that Bill Gates might return in some capacity, but this seems like a long shot at best.

 

Ballmer joined Microsoft in 1980, and the environment then to now could not be more different. What was once the undisputed leader in the space, a heavyweight giant that printed money and dominate the emergence of the PC, is now an increasingly out of touch corporation that failed to capitalize on the emergence of mobile, tablets and connected computing in general. While the company was able to build and grow the home entertainment side of their business through Xbox, the business has failed to expand Microsoft’s reach into the living room beyond just a gaming device. Their web business was rapidly surpassed by Google, and social media giants took the casual eyeballs away to younger, “cooler” companies.

 

Earlier this year Ballmer announced a major restructuring designed to help stabilize the company into a devices and services business and reduce politics and infighting which had grown to an all-time high within its walls. The reorg didn’t work, as Surface tablets and Windows Mobile failed to gain any market traction while Apple, Samsung and Google continued to advance their devices and initiatives.

 

I worked at Microsoft through the 90s and a bit into the next decade. Unlike some who are cheering this moment I don’t dislike Ballmer; he was a spirited advocate for the company and helped lead the aggressive charge to dominate, win and progress a vision. But this was pre-CEO Ballmer, and the lesson that has played out is that an excited champion does not translate to a company leader. But the problems facing Microsoft that brought it to what it is today certain preceded Ballmer’s tenure as CEO. The company’s culture has, at times, fostered an arrogance in their leadership that filtered down into even lower-level Engineers. Every employee and every company should believe they are capable of doing the best work in the world, but taken to an extreme it removes self-awareness and creates blind egotism. It creates people who make bad decisions out of self-importance and arrogance rather than what is best for the group, the product or the consumer. It creates a culture where opinions are belched out and not debated, where someone will argue without listening and considering other opinions, and where managers will abuse the relationship with their staff simply because they can.

 

Microsoft has plenty of smart people and plenty of capital to change the world again. But the culture must have a severe seizure to recover; big bands of middle management have to follow Ballmer out the door (or, if Ballmer and the board really want to set the company’s next leader up for success they should precede him) and the company must discover their humble roots that they have not explored in 25 years.

 

Microsoft is a cautionary tale for any large company of what can happen when you believe your own hype too much or where you allow your staff to behave with no self-awareness or basic respect for others. Ballmer’s run as CEO unfortunately marked an era of decline, much of which I believe had little to do with Ballmer himself… but he will be forever attached to it. As leaders we must be cautious of the currents below us and recognize when a culture has grown in a direction harmful to the whole.

 

I hope Microsoft can recover to its former greatness; certainly the tools are there… now the people must follow.

 

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