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Bloodletting? New Blood?

January 28, 2011

The Register has a note today that Dave Thompson is retiring from Microsoft.  I knew Dave from his days in Exchange (though not well), and I was always impressed by his focus on task.  This definately became apparent after he moved over to the Office team, and some of the results there were pretty stellar.

More interesting is the general outflow of executives from Microsoft.

Just last week, Juniper Networks poached the software giant’s Windows consumer marketing boss Brad Brooks.

In recent months the Steve Ballmer-run company lost the boss of its $15bn server and tools business unit, Bob Muglia, its entertainment and devices chief Robbie Bach and biz division boss Stephen Elop.

Microsoft’s top software architect Ray Ozzie and the firm’s senior vice president of design and development and Xbox nerd J Allard both recently quit, too.

Earlier this week, Microsoft won a restraining order from a Washington state court, after its ex global government biz general manager Matt Miszewski popped up in a very similar role at cloud computing rival Salesforce.com.

I think if you go through that list, you see a variety of reasons on why the executives left, but nonetheless they’re leaving.  Some of them were Microsoft efforts to add executives that just didn’t work out, some were likely disagreements with their boss — Steve Ballmer — that ended up being irreconcilable.  Looking in the whole, this is a pretty big list of heavy hitters in the company.

Two things raise from this.  First, there’s a need to ensure that the company has adequate bench strength to recover from the loss.  If you’ve been reading this blog, you’ve seen Lynn comment about the lack of opportunities for some younger employees across the globe.  Seeing these execs move on means that someone else got the opportunity to move up, and that moves the chain overall.  It’s a small thing, but a couple levels down the organization, this could be a great boon to a big company like Microsoft.   Of course, all this is moot if the person replacing the particular executive can’t execute at the bigger stage.

The other concept is that of organizational bloodletting to make it more healthy.  There are plenty of places that watch Microsoft like a hawk on the Web, and many noted that Ray Ozzie (as an example) just wasn’t fitting into the culture of the company.  So his departure, while a loss for the company’s desire to innovate and find new project areas, maybe was healthy in terms of resolving upper-level conflicts.  A few others of those guys, Bob Muglia comes to mind, were long-time Microsoft executives who had really been moving the company forward.  They appear a bit more troubling on the surface.  Whenever an organization loses a bit too much in the leadership area, it will flounder as the new leader asserts.

If you’ve looked at Microsoft in the past decade, the stock has gone pretty much nowhere.  Clearly something needs to be done to keep the shareholders focused.  So looking at the whole list, I can’t say one way or the other which direction this is pointing.   However, if this doesn’t create a pretty immediate swing, I’d have to wonder if the patient is losing a bit too much from the leeches.

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