Now that Microsoft has formally announced a bunch of Senior Leadership Team changes I thought it appropriate to comment.
The easiest one is Tony Bates. Like many CEOs who join a large company as part of an acquisition it can be hard to find an appropriate role in said large company. I assumed that Tony took the Business Development job as a landing spot until something more appropriate came along (which could have been Microsoft CEO or ownership of a future business). With Satya’s ascension to CEO Tony probably concluded there was nothing appropriate for him in the reasonable future. In fact the most appropriate roles probably required that he, like Julie Larson-Green, would have had to give up his EVP position for a CVP position.
Speaking of Julie Larson-Green, with the closing of the Nokia deal she wasn’t going to be heading the Devices business at Microsoft. So, if you have to play second fiddle you might as well choose a role that you have real passion for and unique skills in. Julie’s new role working for Qi seems to fit the bill. Good move for Julie and Microsoft.
Tami Reller’s departure is a bit of a surprise, but not a huge one. I did not expect Satya’s ascension to CEO to necessarily impact Tami because they’ve worked together before. They certainly were peers in Microsoft Business Solutions, and Tami may have briefly reported to Satya (though I can’t recall all the timing). As far as I know they had a good working relationship. But Tami’s background was finance and her marketing chops relatively limited. So owning all of marketing for Microsoft was clearly a stretch. Whatever discussions have happened over the last month it must have been clear to Tami, Satya, or both that Tami wasn’t the person for the job the way that Satya saw that job. And as much as I respect Tami, I don’t see her leaving as an earth-shattering departure.
Meanwhile, combining Tami’s responsibilities with the advertising responsibilities that Mark Penn had and giving them to Chris Caposella as Chief Marketing Officer is a great move. Chris is probably the most respected marketing leader inside Microsoft. Recall that Chris actually was the Chief Marketing Officer, taking over Central Marketing (as well as creating the Consumer Channels Group), from Mich Mathews 3 years ago after a long spell as the head of marketing for all Information Worker oriented products. Along the way his CMG responsibilities moved to others and he was left with CCG. This reorg not only reinstates his CMO title and CMG responsibilities (which included corporate advertising before Mark Penn took them over) but gives him leadership of all Microsoft product marketing as well. Chris actually was the most logical choice to have been given this role as part of last summer’s One Microsoft reorg, but lost out to Tami in the game of musical chairs. Now balance has been restored.
Which brings us to Mark Penn. I don’t know him and I really don’t know how insiders think of him. Outsiders seem to base their opinions on their like or dislike of the Scroogled advertising campaign. Of course I expect that campaign represented about 1% of his efforts since joining Microsoft and is almost irrelevant in the greater scheme of things. In his revised role it looks like he lost direct operating responsibilities but retained his advisory role on corporate strategy. He even had his title altered slightly to reflect the new focus (and likely to sooth his ego over losing control of advertising). He is still EVP of Strategy, but also is called out as Chief Strategy Officer. Microsoft has been throwing “Chief” around a lot the last few years and I don’t associate any incremental influence or power with those titles. What is important is what the actual job entails. Read Satya’s mail I linked to above for a good description of that.
That just leaves Eric Rudder taking on Tony Bates’ responsibilities on an interim basis. I think the interim part is real and this was just a move to avoid overloading Satya with one or more additional, and perhaps junior, direct reports while he searches for a new leader for this function. Or decides to organize it differently.
I don’t think any of these moves are earth shattering in the short run. They do represent incremental changes that will lead to a more cohesive Senior Leadership Team. They also mean that the SLT is more heavily weighted with people who grew up with the company and were (often as junior individual contributors) part of its glory days. They no doubt are highly motivated to be known as the ones who returned the company to unquestioned leadership status. I can’t give an unbiased opinion on if this is the right direction to take (my biased one is yes), but there is one thing I’m sure of. Steve Ballmer spent a lot of time flailing about looking for a formula, including hiring many outside executives at the Senior Leadership Team level, to propel Microsoft forward. With Satya’s appointment as CEO, and his management moves so far, it is clear that the primary bet is on home grown leadership. That could reignite a lot of passion within the company.