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Nadella: Microsoft Must Change Its Culture, Not Its Technology

It's no secret that big changes are coming to Microsoft. CEO Satya Nadella made that clear in his 3,100-word memo to employees late last week. The key takeaways of that message were that Microsoft is now a platforms and productivity company and it intends to become leaner in a way that it can bring products to market faster.

While the new platforms and productivity mantra doesn't mean it's doing away with its old devices and services model, Nadella is trying to shift the focus to what Microsoft is all about and it's sticking with a strong cloud and mobile emphasis.

The latter sounds like Nadella wants to accelerate the Microsoft One strategy introduced last year and, reading between the lines, he wants to break down the silos and fiefdoms. In his keynote address at Microsoft's Worldwide Partner Conference in Washington, D.C. today, Nadella said the company intends to change its culture.

"We change the core of who we are in terms of our organization and how we work and our value to our customers," Nadella said. "That's the hardest part really. The technology stuff is the simpler thing. We all know that but we need to move forward with the boldness that we can change our culture. It's not even this onetime change, it's this process of continuous renewal that [will] succeed with our customers."

Nadella's push comes when there is unease among the Microsoft ranks. Rumors persist that Microsoft is planning some layoffs. The move isn't unexpected, given Microsoft inherited 25,000 new employees from its $7.2 billion acquisition of Nokia. According to a Reuters report, Microsoft is planning on laying off 1,000 of those employees based in Finland. The layoffs are expected to be the most extensive in Microsoft's history, according to a Bloomberg report.

To date Nadella is not indicating any planned cutbacks but at the same time it appears Nadella is well aware that Microsoft needs to rid itself of those who aren't on board with the company's new way of doing business.

Nadella said Microsoft needs to "enable the employees to bring their A game, do their best work, find deeper meaning in what they do. And that's the journey ahead for us. It's a continuous journey and not an episodic journey. The right way to think about it is showing that courage in the face of opportunity."

Posted by Jeffrey Schwartz on 07/16/2014 at 12:40 PM


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