How Satya Nadella revived Microsoft

http://www.afr.com/brand/boss/how-satya-nadella-revived-microsoft-in-just-three-years-20161220-gtf1i7?&utm_source=social&utm_medium=twitter&utm_campaign=nc&eid=socialn:twi-14omn0055-optim-nnn:nonpaid-27/06/2014-social_traffic-all-organicpost-nnn-afr-o&campaign_code=nocode&promote_channel=social_twitter

by ghosh • 9 years ago

199 138 9 years ago

afr.com

intended• 9 years ago

Nadella, meanwhile, is keen to stress that the goodwill and positive headlines the company is receiving is only of temporary importance. The main responsibility is ensuring Microsoft remains on the right path in the long-term.

Key point. I'm very happy with Microsoft, and have been since they first announced the surface line and the various other moves they've made to make a single OS.

But They've crossed the threshold of the "holy crap? MSFT did that?" And they are in the "well, this needs to work a whole lot better for me to stick around."

The fact that the CEO is aware of this already is a good sign. Looking forward to the surface event this year.

igravious• 9 years ago

Well, if that isn't that a comically spooky infographic:

https://data.afr.com/2017/01jan/microsoft-ceo-hype/index.htm...

nmeofthestate• 9 years ago

Yeah, I'm a bit confused - it seems like MS has just continued to do what they had already started doing before Nadella took over. For example, their cloud computing offering was released in 2010.

GCA10• 9 years ago

But bear in mind that anyone can have a cloud-computing initiative. Hewlett Packard Enterprises has one. Executing well and building momentum in the face of AWS is the hard part. If Microsoft is making headway, that's interesting.

sn41• 9 years ago

IIRC Satya was in charge of Azure in 2010, which is a large part of why he got the top job.

d--b3• 9 years ago

Yeah, Ballmer is responsible for the 2001 tech crash!

booi• 9 years ago

I could overlay Apple vs. Microsoft from 2001 but you won't like that graph...

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...

or how about Google?

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...

Success and failure can and should be measured relative to other related companies in the same industry.

Last 3 years

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...

seunosewa• 9 years ago

Somehow, they managed to give Satya the credit for things that, by their own admission, started under his predecessor, such as Office for iPad, the One Microsoft initiative, and the rebound in Microsoft's stock price. They didn't let the facts get in the way of their heartwarming story.

3adawi• 9 years ago

this is the case for most articles about 'reformers', always selling a story rather than the truth

scholia5• 9 years ago

People like stories. They don't like details. This is why we have HN ;-)

logicuce• 9 years ago

Nadella wasn't an outsider. He was with Microsoft when all this happened.

May be he had something to do with these initiatives and lead to him being promoted eventually.

anjc7• 9 years ago

Ehh. All the credit being given to Nadella are initiatives that Ballmer not only started, but has to push against the will of the board to pursue.

I had major hope for Microsoft in the last few years, and I'm starting to see Nadella's MS slowly unravelling all of the good progress. I just can not believe that Windows Phone adoption got as high as 15% in Europe and then under Nadella they immediately dropped it like it was dirt. The hardware and software was superior in every way to every alternative, and this deprecation has made many of their other successful manoeuvres pointless.

It's mindboggling to me that they're crediting Nadella with Surface and Hololens, in particular.

ghaff5• 9 years ago

Leaders generally get an outsized share of blame and an outsized share of credit for results that become apparent on their watch. I agree that Microsoft didn't suddenly turn 180 degrees the day Nadella took charge.

As for the phone though? Microsoft lost that one a long time ago. They can/should continue to milk other client cash cows and continue with other businesses like Xbox that are peripheral but they're well-established in. But phone would require an all-in push and it's hard to see how that would make sense for Microsoft as a distant #3.

Focusing on Azure doesn't preclude them doing something like that of course; Microsoft's a big company. But I can't fault them from deciding that they largely missed mobile and moving on. (I'm unconvinced Surface and Hololens will amount to anything significant either but I don't really see those as a focus.)

anjc7• 9 years ago

Oh Phones are gone. Finito. But they weren't a few years ago. They were taking a sharp incline with the 9xx range of Lumias in Europe, and they only declined when Microsoft whipped all Lumias from stores and released nothing for a year, the 950 range, which they stopped supporting before they'd even stopped selling it. W10M is effectively still in beta and there are no phones to use it now.

But in the meantime they'd been pushing Continuum, W10/Phone integration, UWP, Xbox/Phone integration and so on. So removing phones tarnished a large chunk of their product line imo. Same for the Band. There's no competitor to it, still, and it's also gone. Same for Kinect. Same for Onedrive subscriptions, etc etc.

This is what worries me about Nadella's MS and it's the same thing that worries me about Cook's Apple...treating the product line like commodities without acknowledging the importance of the ecosystem.

Having said that, as you say, they're a big company. My perspective is solely from that of a devices user.

vetinari• 9 years ago

The hardware and software was superior in every way to every alternative,

No, the hardware was Qualcomm reference platform, which you could find in some Androids too. On Android it just wasn't subsidized the same way as it was on WP side.

anjc7• 9 years ago

Maybe not all hardware, but the camera and lenses in the Lumia range trounced any competitors upon their release, and the screens too as I recall.

Windows Phone 8/8.1 was amazing. W10M has lost the lustre that 8 had.

RandomOpinion• 9 years ago

Why blame Nadella? Terry Myerson headed up the Windows Phone division during its long slide into oblivion before being promoted to head up the entire Windows division when Nadella became CEO. He's specifically responsible for dropping the ball, if anyone is.

simonh3• 9 years ago

I think he did a fantastic job, modern WP is a great product, it was just too late and by then the situation was unrecoverable.

mark_l_watson2• 9 years ago

I really like the direction Microsoft is going in, especially Surface devices, the very nice Office 355 service, and Azure. The one area where I think they have failed horribly is in the phone market.

The lack of having a solid phone that interacts with their other devices, and has a rich app/developer ecosystem cost them my business recently:

I am in my 60s, and comfortably semi-retired. After decades of being a Linux-as-much-as-possible enthusiast, I now want my interaction with my devices to be as easy and workable as possible. The time I still spend writing and software development should be as efficient as possible, in the deep work sense I want to spend just a few hours a day producing things hopefully useful to society, as effectively as possible.

Recently I spent a month evaluation of staying with Apple or getting a Surface Pro. I stuck with getting a new MacBook and with my iPad Pro because of the availability of the iPhone (I am still on Android, but will switch soon), with nothing comproble from Microsoft.

Whatever it takes, I think Microsoft should get back in the phone business with a winning product.

ocdtrekkie7• 9 years ago

They're pretty aware of this. But breaking a duopoly like this requires more than just a "great phone". Microsoft has had and does have "great phones", but without the app ecosystem to back them, it doesn't matter that the phones are great.

The Windows Phone might run faster, have a longer battery life, and just work better than the comparable Android flagship, but since you can get freaking Pokémon GO on the Android, people will buy the latter.

Microsoft is basically waiting for a chance at a paradigm shift in what it means to have a smartphone, so that they can release something you can get nowhere else. In the meantime, they're kinda just treading water and keeping their mobile OS workable and modern.

pjmlp5• 9 years ago

The Windows Phone might run faster, have a longer battery life, and just work better than the comparable Android flagship

Which is the reason when my S3 dies, I might just adopt one of my Lumias as main device.

I am not willing to pay more than 300€ for a smartphone and it is pretty clear Google has no motivation to fix the mess of Android upgrades.

ghaff5• 9 years ago

Microsoft is basically waiting for a chance at a paradigm shift in what it means to have a smartphone, so that they can release something you can get nowhere else. In the meantime, they're kinda just treading water and keeping their mobile OS workable and modern.

I think that's likely both a good summary and a smart strategy. We can imagine, at least in broad terms, an evolution toward a much more unified set of connected devices. Microsoft has arguably already done the best job of reconverging the tablet and laptop with the Surface Pro but it's not enough to make most people really care.

Of course, the best way to predict the future is to invent it (Alan Kay) so, at some level, it's an opportunity that's up to them to create.

ddito• 9 years ago

I think it's more that the port of Windows to phones was so broken that they saw that there is no way they will get the platform into a stable state in the next year. It..just..so..broken.

I had a lumia 950 and with the crashes, lack of apps and UX horror I bought a OnePlus after 2 months amd never regreted it.

I heard that Windows Phone 7 was nice and everything went downhill with WP8 but I wouldnt know personally

bambax3• 9 years ago

without the app ecosystem to back them, it doesn't matter that the phones are great

Is this true? It sounds true but I wonder if it actually is.

(I for one don't care about apps -- at all. I want a "smartphone" because I want the ability to browse the web, and that's it. I can't be the only guy like this.)

And even if it were actually true that apps are important, if you're MS, can't you jump start the app ecosystem? Android being opensource, how hard would it be for MS to make a phone capable of running Android apps (and yet be a different phone with a different OS of course)? (Also, they have Xamarin).

Microsoft is basically waiting...

Well, yes, they don't seem to be trying very hard. This is quite strange.

yaseer3• 9 years ago

Although I think Nadella has made some good changes to company culture, there's a lot more variables that influence a company's performance than the CEO, just as there's a lot more variables that influence a country's Economic performance than a ruling party.

The piece does that all-too-common simplification of providing a single cause to explain the fluctuation is MSFT's fortunes, a form of cognitive bias I believe. We like simple stories for complex phenomena.

https://en.wikipedia.org/wiki/Fallacy_of_the_single_cause

perseusprime112• 9 years ago

I agree there is no single cause but you are also under estimating the power of a CEO who is responsible for resource allocation and investments. Where he chooses to invest is what becomes of a company. Culture also flows from top down and CEO plays a big role.

yaseer3• 9 years ago

Oh I don't dispute that his impact has been significant and positive. I just think there's other factors at play here. For example, Google was extremely slow to market with a competitive cloud strategy, and Apple has been a less competitive player the last 3 years with its own product innovation.

splintercell• 9 years ago

Or that there is another single factor which led to the hiring of a CEO like Nandella and not like Ballmer.

mempko• 9 years ago

It's almost like a corporation is a mini fiefdom. Like there is a petty dictator at the helm , no matter how benevolent. Weird how capitalist companies are structured that way

rev_null• 9 years ago

What if the lesson is not that Nadella is a great CEO, but that Ballmer was actually terrible?

exabrial• 9 years ago

Agree, 100%... One more variable I think it's also a combination of timing too. For example: Tim Cook is busy destroying Apple's product lineup forcing a lot of people to reconsider Microsoft.

mathattack• 9 years ago

The latter is not very controversial. The question is can a tech giant be saved? The track record generally isn't great for companies that pass their day in the sun. Having a great CEO is a necessary, but not sufficient, condition for a rebound.

ChuckMcM• 9 years ago

I see it quite differently, the leader is the single biggest influencer on the performance of the group. There are many examples in sports where just changing the coach has changed the team from an underperforming team to a leading team. Similarly with companies, a leadership change has often lead to a significant change in performance.

To understand that you have to understand that pack behavior tends to mimic the leader, so if the leader does X, then their reports do X, and the people who report to the reports do X. In large organizations you may find pockets where someone in the change decided not to do X and then everyone below them is free of that expectation (for better or worse).

blacksmythe• 9 years ago

  >> mimic the leader, so if the leader does X, then their reports do X...

Certainly true - perhaps the best definition of a leader.

There are plenty of people who are managers and not leaders, though.

d--b3• 9 years ago

People at Microsoft said the wind of change was blowing long before Nadella took the job. They timed the announcement of Nadella to coincide with deliveries of new products / open platforms. The whole thing was to change the image of Microsoft: New products + new face = new Microsoft.

It's not like Nadella fired every one and started afresh.

jonknee3• 9 years ago

It's not like Nadella fired every one and started afresh.

He announced huge layoffs (18,000 people) almost as soon as he took over. A lot of Nokia people, but also 5,500 people not related to mobile and 1,400 of them at HQ. A year later he made another huge cut of 7,800 people.

simonh3• 9 years ago

More evidence for d--b's point. Firing 18k people at Microsoft's scale isn't even close to burning it down and starting from scratch. It's also not something a newly minted CEO would be able to get past the board on such short notice. It must have been planned in advance. Whatever you say about Balmer, someone at MSFT knew how to flawlessly execute a masterful transition plan. I though Apple did a good job, but MSFT nailed it.

d--b3• 9 years ago

Don't get me wrong, Microsoft did change course. It was a tanking bloated juggernaut, and the change from pre-Nadella days has been drastic. But what I am saying is that the change had started at least 3 or 4 years before Nadella became CEO.

The article is all about how the guy changed everything so quickly while in fact this was already happening.

What's possible though is that the big guys at Microsoft planned to give the job to Nadella a while ago, and that Nadella, under Ballmer, did actually take all the decisions that took Microsoft in the right direction.

Analemma_• 9 years ago

What I kept hearing from people inside Microsoft was that the most helpful single change was getting rid of Sinofsky, and that was when the shift really began. Apparently he (much more than Ballmer) was responsible for the "Windows first" mentality that kept hobbling the rest of the company, though of course Ballmer deserves some blame for not doing his job and pushing back on that.

MikusR• 9 years ago

If i recall correctly (from what I read at the time) he hid either the existence of Surface RT or the SOC it was running from the team that was porting Office to ARM. So they had to ship an unfinished version of Office (that required multiple steps and different interfaces to update to final. Which no reviewer or early user bothered with) with it.

stinos• 9 years ago

wind of change was blowing long before Nadella took the job

Well, just look at that stock prices graph, seems in line with this: sure there's a flat line during Ballmer's first 10 years, but then it suddenly started going up and the trend just continued in the same trend when Nadella got assigned. Not saying he's not doing a good job: from what I see I'd say he's doing well, though of course there's a whole lot of information I don't see so I really cannot tell.

appleiigs• 9 years ago

That stock chart is useless. It needs to show the delta between MSFT and an index of the broader stock market or just the tech industry.

johnnycarcin2• 9 years ago

I can't speak to the product side because up until a year ago I hardly used any MSFT products but I can say that the culture that has been brought by Satya, and likely his reports, is one of the reasons I joined MSFT after being a longtime hater.

When I was approached to come work for MSFT I said "no" right away. The person recruiting me said "just listen to our pitch and then you can say 'no' if you want". After hearing Satya talk about where he wants the company to go and what it'll take to get there I had a 180 degree switch on how I felt about MSFT. I talked with some other old-timers who were there to see if things really had changed and they all told me that it was a slow progression but things were certainly changing for the better.

Now it's totally possible that they all are just good at selling to people but it was enough to get me to join and 95% of the time I'm glad I did.

ditados• 9 years ago

You aren't at a subsidiary, obviously. As the tide shifts to pushing Azure, the sales people are going ballistic and circle customers like sharks, with insane targets.

I joined a short while ago and deeply regret it, since all we do is sales. Even OSS is treated as a pure sales play.

johnnycarcin2• 9 years ago

I actually think we are in the same roles (CSA) :).

I have seen the same thing you are talking about and it is certainly one of the shitty parts of the job. Luckily I've done enough with the sales group around me that they are starting to understand that you don't sell Azure like you would O365 or whatever. There are still days where I walk away thinking that I must be on a different planet but the time I get to spend working with customers and building cool shit makes up for all of the bs.

starik362• 9 years ago

I am not sure how he "revived" Microsoft.

1. They've completely dropped the Phone market under him. As in gave up.

2. They are not in the personal assistant game at all. Alexa & Google have that market all to themselves.

3. The educational market is steadily switching to Chromebooks. The new generation of kids will likely not even know how to use MS Office.

4. On the back end, they've made .NET work on Mac and Linux. This is great for me, since I don't have to worry about Windows Server licenses, but doesn't this eat into their large cash cow?

5. SQL Server - the other cash cow, is great, but free alternatives will start affecting the bottom line.

6. Windows 10 rollout stalled very much short of their stated goal of being on 1 billion devices.

hunterwerlla• 9 years ago

1. The phone line that was losing a ton of money

2. This is being worked on, there is cortana for cars, pc's and phones, so it would make sense for it to expand to even more devices in the future.

3. This is the point of windows 10 cloud, which recently leaked.

4. Windows is really not the cash cow of Microsoft, getting more people into the ecosystem is better for buisiness.

5. Free alternatives have existed forever, alternatives that you could argue are the same or better, recently SQL Server was ported to linux which actually should shore up its market share, and even possibly increase it.

6. True but does this actually matter that much?

ConceptJunkie2• 9 years ago

hunterwerlia, I find it amusing that your response, which came in while I was writing mine, says pretty much the same thing. :-)

starik362• 9 years ago

You are kind of proving my point that Microsoft, in fact, was not "revived" by Nadella.

2. Maybe it is being worked on and maybe it'll even be great. The problem is that people don't replace personal assistants every 2 years. They lost the first mover advantage.

4. Windows for enterprises, specifically server versions are cash cows. I fail to see the value (to Microsoft) of a developer getting into the .NET ecosystem if they intend to run your code on Linux.

5. It's true that free alternatives have always been around. But now, they are reasonably good. And more importantly, good enough.

6. Yes, it does. It's actually one of the few places where they could monetize people getting into their ecosystem.

ConceptJunkie2• 9 years ago

1. That was good. At some point you need to cut your losses.

2. Yet. Microsoft has a tremendous research department. They could still come out with something game-changing.

3. This is also good. We don't need a bunch of kids who are brought up on software designed in the 1980s and hasn't advanced since.

4. I think MS has decided that they need to open up to certain degree despite the loss of revenue that it can cost because of the other less tangible benefits.

5. It's a good thing that MariaDB has been forked from MySQL because Oracle has had a tendency to kill every open source project they've acquired, or let them die.

6. The problem with Windows 8 was that aside from the improvements under the hood, every single thing that changed was for Microsoft's benefit, and not for the benefit of the users. Windows 10 backed off on this arrogance, but only a little. Microsoft has clearly made the commitment that when it comes to PC operating systems, that the user, and not the software is now the product, and that from now on, in order to get the marginal improvements in their products, you will have to sacrifice a lot in terms of privacy, usability and convenience. And that's assuming that their QA is up to snuff, which it clearly isn't.

tortasaur2• 9 years ago

You aren't really refuting the parent comment's point that Microsoft has not been revived. You're just arguing that Microsoft's descent is good for society overall. While I agree, the parent just argued that Microsoft hadn't been revived.

kermittd• 9 years ago

Is everyone a cynic online?

simplehuman• 9 years ago

I have a great theory here. If you agree entirely mostly with the article, there is nothing to comment. Or you have to write something boring. But if you want to comment and get karma, you have to write something spicy. And thus the comments are all cynical and contrarian.

tortasaur2• 9 years ago

No, but they're generally less susceptible to the more transparent forms of marketing.

awinder• 9 years ago

I think Microsoft has done a great job of transforming to being very brand-conscious and these stories are both a recognition of that from the press, and a bit of a self-fulfilling prophecy (they talk about how different they are, the press does, then they point to the press and dress up their UX, it's very self-feeding in a way). That said -- I can't say I've experienced great technical changes in the products from microsoft that I do use, at least yet. Windows 10 is still windows underneath, and I've run into some real rough patches on windows 10 on my tower setup. Xbox controllers are still breaking down after several months. Their Cloud offering just blows my mind in a bad way in almost every interaction I've had the displeasure of experiencing.

So I read articles like this and look at the rebranding and really have a hard time deciding whether I want to point to these things as at least having a good direction, and showing that they understand that they need to care about these things. But then I'm dismayed at the execution. Does anyone else have the same thing going on?

z0d• 9 years ago

Shocked to see Windows 10 being depicted as an advancement in some of the comments along with that office 365 service. Yeah the Halcyon days of PC ate definitely gone by looking at these cringrworthy points.

M$ clearly have made their point with continuous eternal Beta program and sheeple insider ring, UWP and WDDM2.0, Gimmicky stuff cough DX12 gamemode cough.

Destroyed the PC, Mr Nadella should be praised for all this...

bcg1• 9 years ago

They credit Nadella with increasing the stock price... but MSFT performance is basically the same as the overall NASDAQ composite (of course I'm sure MSFT itself is a large portion of that index) as well as the larger S&P 500 index.

http://stockcharts.com/freecharts/perf.php?$COMPQ,MSFT,$SPX&...

awa• 9 years ago

you dont see it behind by 30+% in 2013 to nasdaq and now meeting it to equal now.

See: http://stockcharts.com/freecharts/perf.php?$COMPQ,MSFT,$SPX&...

camdenlock• 9 years ago

Having spent my youth childishly ranting against the evils of M$, and now coming to terms with the fact that I sincerely use VS Code because it's great, I can't shake the frequent uncanny feeling that I'm stuck in an episode of Sliders.

ino2• 9 years ago

DOS 6.22 + WIN 3.11 were great.

Windows 7 was great.

Windows 10 is not. Having a good cross platform code editor surely isn't going to make me use Windows 10.

bsaul• 9 years ago

Dos + win 3.11 was an absolute crap. Had a mac at the time and i couldn't understand how people could cope with that horror. Anything, from atari to amiga to mac was obviously better. Windows started to be usable starting windows 95. Before that, it was mainly a hack.

epynonymous• 9 years ago

+1 for VS Code, it's hands down my favorite editor.

Entangled• 9 years ago

Revived?

I haven't touched a ms product in over a decade. And by god I won't until the end of my miserable days in this world.

jernfrost• 9 years ago

Refreshing to see somebody who is not an asshole succeed. Too many people seem to have concluded that success can only be achieved by being some variation of asshole whether it is Steve Jobs, Bill Gates, Steve Balmer or Larry Ellison.

Mind you I am a huge fan of Steve Jobs, despite the fact that I think he also was kind of an asshole. People are complicated I don't think Steve succeeded because he was an asshole but due to the other qualities he had not related to being an asshole.

And people of course change. Bill Gates seems like a much nicer man today than he was when he ran Microsoft. I guess much the same happened with Steve Jobs. He was a better person in his older years than in his younger.

mhermher• 9 years ago

A coworker once described to me how he thought people misinterpreted Jobs' success.

Jobs didn't succeed because he was an asshole, he succeeded despite being an asshole.

You sometimes see people trying to emulate Jobs and thinking they need to be an asshole. His take was that they completely missed the reasons for Jobs' success.

He was definitely an asshole though, especially early on.

v3gas2• 9 years ago

How is (or was?) Bill Gates an asshole?

gozur88• 9 years ago

You need to read the "fuck counter" story. I woldn't work for someone like this:

"Bill doesn’t really want to review your spec, he just wants to make sure you’ve got it under control. His standard M.O. is to ask harder and harder questions until you admit that you don’t know, and then he can yell at you for being unprepared."

https://www.joelonsoftware.com/2006/06/16/my-first-billg-rev...

paulddraper4• 9 years ago

He exploits a loophole where he avoids paying his fair share on the BILLIONS he gives to charity. </s>

Seriously though, it's harder to find bigger philanthropists then the Gates.

bambax3• 9 years ago

Stephen Jay Gould often talked about how some evolved features happen not because they're beneficial to a species' success, and despite them being outright detrimental, but simply because they are linked to some other feature that is beneficial; they're necessary side effects.

Arseholery seems to fall into exactly that category. It's not helpful per se, but associated with many traits that obviously contribute to success, including clarity of vision and confidence in one's opinion against others' advice, and the ability to persist against all odds.

Nadella seems to be of another fabric entirely; he's not afraid of having a plurality of voices sing at the same time, he's more a conductor than a general.

What he's pulled off so far is amazing; lets hope it lasts.

anon65432• 9 years ago

Ask Kyril Faenov if you think Satya can be an asshole.

woofdogwoof• 9 years ago

It really helps when you have a monopoly, for both operating systems and Office applications, and more cash than most countries in the world.

How Satya Nadella revived Microsoft

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