An Analysis of Microsoft’s Lost Decade Under Steve Ballmer
Yesterday Micorosft announced to the world that the CEO Steve Ballmer will be retiring in 12 months. This news immediately sent the company’s stock price higher. Yikes!
What exactly happened to Microsoft under Steve Ballmer?
Writing for Vanity Fair, Kurt Eichenwald points an accusing finger at C.E.O Steve Ballmer for leading the company astray.
Eichenwald alluded to the fact that the writing was on the wall for Steve Ballmer after a lackluster performance at the 2012 International Consumer Electronics Show.
According to Kurt Eichenwald:
But this night, an air of discomfort filled the Palazzo Ballroom, where Ballmer was about to give the show’s opening presentation, one delivered by Microsoft’s C.E.O. for 14 of the previous 17 years—the first 11 by Bill Gates and the rest by Ballmer. Weeks earlier, the company had declared that this would be its final keynote—and, worse, that it wouldn’t even be back next year as an exhibitor to showcase new innovations. The timing for big news about its products, it said, didn’t match that of the annual high-tech pageant.
….As for announcements of quantum leaps into the technological future: nothing. Ballmer applauded the still-long-awaited Windows 8 operating system (which as of this writing is available only as a release preview online). He burbled about his expectations for Xbox, the game console that successfully competed with Sony PlayStation. Out came Windows Phone 7 again, which, despite widespread praise from users, had experienced bleak sales results. A demo followed, which proved an embarrassment; the device’s voice-to-text messaging failed and then another glitch forced a Microsoft staffer to reach for a different phone. The media response was dismal—the company’s last presentation, a prominent blogger wrote, was a “cruel joke.”
Microsoft’s low-octane swan song was nothing if not symbolic of more than a decade littered with errors, missed opportunities, and the devolution of one of the industry’s innovators into a “me too” purveyor of other companies’ consumer products. Over those years, inconsequential pip-squeaks and onetime zombies—Google, Facebook, Apple—roared ahead, transforming the social-media-tech experience, while a lumbering Microsoft relied mostly on pumping out Old Faithfuls such as Windows, Office, and servers for its financial performance.
Kurt Eichenwald also highlights internal cooperate battles among employees as a major reason for the company’s demise.
By the dawn of the millennium, the hallways at Microsoft were no longer home to barefoot programmers in Hawaiian shirts working through nights and weekends toward a common goal of excellence; instead, life behind the thick corporate walls had become staid and brutish. Fiefdoms had taken root, and a mastery of internal politics emerged as key to career success.
In those years Microsoft had stepped up its efforts to cripple competitors, but—because of a series of astonishingly foolish management decisions—the competitors being crippled were often co-workers at Microsoft, instead of other companies. Staffers were rewarded not just for doing well but for making sure that their colleagues failed. As a result, the company was consumed by an endless series of internal knife fights. Potential market-busting businesses—such as e-book and smartphone technology—were killed, derailed, or delayed amid bickering and power plays.