I was shocked yesterday when an alert popped up on CNBC that Bobmu was going to leave Microsoft. Of course, a little more investigation revealed that Bob was only leaving after Steve Ballmer decided to replace him as head of STB. On one level that was even more shocking, on another it wasn’t that big a surprise. As others have noted, Steve and Bob’s relationship has been somewhat rocky over the years. For a public example just look at how long it took Steve to give the President title to Bob, even though Bob was running one of Microsoft’s 3 big and profitable businesses. Bob reported to Steve and functioned as a President in all respects, but the recognition. Contrast this with recent examples where Steve made more junior, and less proven, executives such as Andy Lees (Mobile) Presidents. Just over three years ago Andy ran Bob’s marketing team. And while Mobile is certainly a critical area for Microsoft, Andy hasn’t proven he can be successful at it. In fact, one could argue that it took him a year too long to reset the mobile strategy and bring in new engineering leadership to transform Windows Mobile into Windows Phone 7. If Microsoft fails to succeed in Mobile, that year will go down as the gap that allowed Android to establish itself as the alternative to iOS and create a two-OS race. In fact, if one weeds out the noise (WP7, Blackberry, WebOS, etc.) we have a repeat of the classic race between the Mac and PC playing out with iOS taking the role of Mac OS and Android the role of Windows. We know how that one turned out. On the other hand, if Microsoft stakes out a position as a peer leader with iOS and Android in the mobile phone space then Andy will be one of the true heroes at the company.
Meanwhile, in all the critical races in the STB space Microsoft has done well. It established SQL Server as one of only three remaining mainstream database players, and one could argue the only real alternative to Oracle. The related efforts in BI forced consolidation across the BI industry, and yet Microsoft continues to innovate rapidly in this space. It blunted the Linux juggernaut and has grown market share despite the challenge (with other OSes losing to both Windows Server and Linux). And it stopped what looked like an unstoppable movement to Java by bringing the very successful .NET to market. Even more recent efforts, like Silverlight can easily be declared successes and had HTML5 not stepped in as a game changer I could imagine Silverlight eventually overtaking Flash as the way to build Rich Internet Applications (RIA). While Bob wasn’t the only one, or even the primary person, responsible for all of this he has played important roles in making it happen and keeping it going. In addition to Bob, Microsoft CTO David Vaskevitch (who was the original visionary behind what became STB and lead various parts of it in the 90s), Sr. VP Paul Flessner (who ran the server products other than Windows Server), and numerous other executives and partners behind the creation of STB, have left in recent years leaving one to wonder about Microsoft’s future in “the enterprise”. One of the results of Bob’s departure is that it will hasten the departure of other senior leaders in STB; some who would have left anyway in the next year or two and others who will now decide the grass is greener elsewhere.
At any given time there are several rumors running around Microsoft about executives who are going to leave. Sometimes these are grounded in fact, more often they are (at least in the near term) just rumors. Here is a hint to Microsoft watchers: if you look at a long-time Microsoft executive and figure out when his/her youngest child enters college you can tell when they are most likely to retire. It’s simple, a lot of what you would do in retirement doesn’t make sense when you have kids living at home. Travel is the most obvious one. So even employees who have things they really want to pursue outside of Microsoft (and even if it isn’t 100% retirement, they want control of their time) realize they should wait for the kids to be out of the house. So, lets say you just shipped a big product . Do you “sign up” for another grueling 2-3 year cycle or do you pull the plug? If the kids are at home you say “well, what else am I going to do for 2-3 years?” and sign up. If the kids are gone you say “I think we’ll spend the next year in Paris”. Ditto for anything that makes your job no longer fun (as remember we are talking about people who are generally financially independent). So for me the biggest shock wasn’t an announcement about Bob leaving, it was that his departure preceded a number of other announcements I expect to see. And now with Bob gone a few people who were on the fence will probably leave, and then once his replacement comes on board a few others will decide they don’t want to be part of the “new” STB. Ok, new leadership might cause a few people to put off leaving for a while. As one of my friends who is a bit lower down in the leadership put it, “this could be an opportunity for me”. But I think this balances out to more departures not less.
The real question on the table is what will become of STB? There are two kinds of leaders that Steve could put in charge of it. One would be charged with milking the non-cloud businesses to become more successful in the cloud. This would keep Microsoft targeting the portion of the market it currently addresses but shift the platform. The other would be to put in an executive with a broader charter of expanding Microsoft’s enterprise business, with the cloud as a mechanism for doing so, and giving that executive leeway to propose and execute an aggressive investment program. The truth is that to hire someone who is an “upgrade” from Bob from the outside it probably has to be the latter. A senior executive at this level, someone who probably aspires to be a F500 CEO or similar, isn’t going to take the job if they are going to be placed in a straitjacket. This suggests something else for Microsoft watchers…if Steve picks an insider it is most likely to pursue the former strategy. If he picks an outsider it is most likely to pursue the latter strategy. Of course, Steve could do something like he did with E&D and break up STB or shuffle things around the other businesses. I can think of 3-4 scearios that make sense, at least for some definition of “sense”.
Overall I’m going to miss Bob’s presence at Microsoft and consider this a big loss for the company. I enjoyed working with, and at times for, him over the years. From my first meeting with Bob shortly after I joined the company in 1994, to my occasional meetings with him while I was in my first retirement, to the last product review a few weeks before I left last October, it has been a pleasure. Ok, that first meeting was really strange. And I did go back to my boss and say some very unkind things about Bob. Fortunately that first impression didn’t last Bob, good luck in whatever your post-Microsoft endeavors are and keep in touch.