Going to the Bench: Can Redmond's Backups Keep 'Em in the Game?

New management team must fill the void left by Gates.

Replacing legends is a tricky business. But it's a business Microsoft must carry off over the next two years if it hopes to weather the 2008 retirement of the greatest legend in the industry, Bill Gates.

Gates has already stepped aside as chief software architect, succeeded by Ray Ozzie. Long-time friend Steve Ballmer will remain as president and CEO and will be the one to step into Gates' iron boots once he leaves for good in July 2008.

Finding someone to fill Gates' shoes is going to be a tough trick. In fact, few believe that one or two executives -- even proven ones like Ballmer and Ozzie -- can fill all the roles Gates plays at Microsoft. A management team that can work cooperatively with Ballmer and Ozzie, however, may succeed.

Fab Five
There are five key players coming off Microsoft's upper management bench who could make that happen: They are Craig Mundie, chief research and strategy officer, Steven Sinofsky, senior vice president of Windows and Windows Live, Antoine LeBlond, corporate vice president, Office Productivity, Bob Muglia, senior vice president, Server and Tools Business, and Kevin Johnson, co-president (with Jim Allchin who is retiring in December) of the Platforms and Services Division.

Whether these five, along with Ballmer and Ozzie, possess the right combination of talent, chemistry and humility to work effectively together will only be discovered in time. But some observers are optimistic. They believe these young managers could help the company more quickly enter the age of Web-based development.

"[It has] grown to be an enormously successful company, but there are a lot of changes afoot involving software architectures as well as the way software is going to be delivered and paid for. It may not be a bad thing to have some new people coming that have something other than a PC view of the universe," says Gordon Haff, principal IT advisor with Illuminata Inc.

Gates' transition could also help liberate the new management team from the enormous amount of legacy code still living in current versions of Windows. Industry watchers believe that the new managers will accelerate development around more innovative Web-based products that can be delivered significantly faster.

"These younger managers will agonize a lot less about cutting loose or reshaping existing products or at least not putting so many resources into them and moving forward into Web-based areas," Haff says.

Sinofsky figures to play a central role in guiding Microsoft into the new age of software development, even as he helps get the long-overdue Vista to market. Sinofsky, who joined the company in 1989 right out of college, has a reputation as a disciplined, no-nonsense manager. Over the past decade, he's delivered a new version of Office every two to three years without fail.

Users and business partners like Sinofsky's tough, goal-oriented reputation, but will his experience with Office be enough?

Gates' transition could also help liberate the new management team from the enormous amount of legacy code still living in current versions of Windows.

"We know he knows applications but how smart is he about Windows development and operating systems architectures in general? I suppose if he has been about the company for 17 years he could pick that up quickly and he better, given the state of Vista," says one New York-based Microsoft business partner who did not want to be named.

Another key figure is Craig Mundie, who will work closely with Gates on the company's research and incubation efforts over the next two years. He will also work with Microsoft General Counsel Brad Smith on intellectual property and technology efforts. Mundie joined the company in 1992 to create and run the Consumer Platforms Division, and was the driving force behind Microsoft's Trustworthy Computing Initiative.

"He has been high up there for a long time in terms of influencing research, and he would have been a good candidate for the CTO job too. The question is will he and Ballmer see eye to eye on maintaining Microsoft's commitment to research as well as development," says Dwight Davis, vice president and practice director with Summit Strategies.

Antoine Leblond, who also joined Microsoft in 1989, has a reputation for pushing the envelope on innovation and emphasizing Web development. He's responsible for features in Word such as background spell checking, HTML file formats and Visual Basic for Applications. As director of Office development, Leblond will be responsible for the technical design and development strategy of Office, Microsoft's largest revenue generator.

Paging Al Haig
Despite stepping away from day-to-day management at Microsoft, industry observers say Gates has remained a formidable presence. He continues to preside over product reviews, amp up energy levels, and bring together the talent and resources to complete mission-critical initiatives.

"You have some very creative talents in that team, but they are opinionated and may have very different views on things. The real issue is putting them all together as you will no longer have this integrating point of coordination and decision making there every day," says Will Zachmann, president of Canopus Research in Duxbury, Mass.

Zachmann and others note there is ample evidence that no matter how much luck and skill goes into assembling a management team, when a leader as entrenched as Gates leaves, the possibility for political jousting is always present.

"Guys from time to time on the technical side of the house at Microsoft have tried to pull an Al Haig thing. Ray has vision and talent but you can imagine an old palace guard there setting the stage for corporate infighting. Think of the Greek armies after the death of Alexander," Zachmann says.

During this transition, Microsoft's upper management must maintain a broad perspective. In the past, the company has allowed its field of vision to narrow to development on Windows and Office.

"There has been a tendency with those in leadership positions at Microsoft to get myopic. The worst thing about being myopic is you think you actually know what is going on, and that is when you make mistakes," says Melinda Ballou, program director of application life-cycle management at IDC.

"The problem with visionaries new or old at Microsoft is their only experience within the enterprise comes from within the womb of the Microsoft environment," says Mike Drips, an independent IT consultant working with large accounts in the San Francisco area.

Change Management
Despite the growing competitive pressures and continued product delays, some analysts believe Microsoft is in a fine spot.

"There is so much advantage to momentum and presence, and Microsoft still has both. You can point to Vista delays and growing competition from multiple directions, but I still think there will be a lot of forward momentum at Microsoft, regardless of who is at the helm," says Summit Strategies' Davis.

The new management team might ease the task by using Gates' departure as an opportunity to change Microsoft's corporate personality. Some believe the emerging powers-to-be should take the opportunity to present a softer, more-friendly image to the outside world. But which managers might lead such a transformation is unclear.

"With Gates gone the company can't afford a lack of personality, but it has to change the one it has," says Dana Gardner, principal analyst with InterArbor Solutions Inc. "It can now change it quickly but the question is what that personality going to be. If it is schizophrenic with different personalities that are hard to identify, it could be a long and difficult period for them."

About the Author

Ed Scannell is the editor of Redmond magazine.


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