Why Ballmer Should Leave Microsoft

An anonymous reader writes "In the wake of the announcement of Bill Gates' departure from the top spot at Microsoft, CNN Money is carrying an article arguing that Steve Ballmer should step down as well." From the article: "Since Gates stepped down as CEO in 2000 in favor of Ballmer, the company has floundered technically and strategically. As the company's chairman, chief software architect and supposed visionary, Gates deserves blame for missing the wave of Web-based software that has propelled Google and Yahoo. But Ballmer has made gaffes of his own in his longtime role as head of the company's business side. They include an undistinguished push into business applications to compete with Oracle, financial maneuvers that have failed to stir the stock - which has slumped 16 percent so far this year - and continuing antitrust problems in the United States and Europe."

Ballmer shouldn't step down.

He should become the chairman.

Afterall, he is qualified.

Thank you, I'll be here all night.

Re:Ballmer shouldn't step down.

Ballmer should step down in favour of Mr T, because he pity the fool who don't got high-end video cards and 4GB RAM for Vista Aero!!!

Seriously... if Mr T was in charge of Microsoft, it would be profitable. This should not be modded funny because it's actually insightful.

Re:Ballmer shouldn't step down.

Oh and they give you insightful. You ask and they do. Mod this as brilliant.

Re:Ballmer shouldn't step down.

Seriously... if Mr T was in charge of Microsoft, it would be profitable.

are you under the impression that M$ is currently not profitable? :)

Re:Ballmer shouldn't step down.

Listen up, if I hear just one more Ballmer joke, I'm going to f**king kill every single one of you! Thanks, Steve B.

The heir apparent.

From the article:

Chief Operating Officer Kevin Turner, a recent hire from Wal-Mart Stores where he ran the Sam's Club division and previously served as the retailer's chief information officer, is the most likely replacement for Ballmer.

He has one big strike against him: his short tenure at Microsoft, which translates into a lack of familiarity with the company's culture. He's believed to be behind a recent cost-cutting move to force the company's substantial contractor workforce to take an unpaid week off. Since contractors at Microsoft contribute to important projects and are often hired on as full-time employees, the move hurt morale.

But as Wal-Mart's CIO, he bought a lot of software from Microsoft, giving him a valuable perspective as a customer that most executives who rose through the ranks at Microsoft lack.

Microsoft run by a WalMart Exec. The mind boggles ....

heck, the parodies practically write themselves

Re:The heir apparent.

heck, the parodies practically write themselves

Only in Soviet Russia.

Re:The heir apparent.

Actually, this makes perfest sense. Both Wal-Mart and Microsoft based their businesses on selling cheap low-quality products to the masses who do not know better, and then use unfair (and often illegal) tactics to force the competition out of business, thus denying higher quality producted to those who do know better.

In both cases, the company has created an business echosystem with itself at the center where the partners (manufactures for Wal-Mart, and ISV for MS) are addicted to the cash flow, but to compete for the crumbs that WM or MS allows them to receive under the constant threat of getting crushed like a bug.

Entirely unsurprising

" He's believed to be behind a recent cost-cutting move to force the company's substantial contractor workforce to take an unpaid week off. Since contractors at Microsoft contribute to important projects and are often hired on as full-time employees, the move hurt morale."

Ah, so he knows the magic words ("cost-cutting move") and likes to kick the workers in the teeth. I can see how Wall Street would love him.

*sigh* There's been a recent article linked to by /. about how some people at the top are really psychopaths, in the medical sense of the word. Still, technically that only has to mean not caring about others. But the more time goes by, the more it seems that some people at the top aren't just psychopathic, but also the sadistic kind. And some just seem to have a sort of hatred for those they're supposed to manage.

I mean, look at his cost-cutting move:

1. There are 52 weeks in a year, even if _everyone_ at MS was a contractor, and if salaries were the _only_ expenses MS ever has, it still would have saved less than 5% of the costs. But when you factor in that not everyone is, and also that execs salaries aren't the same as those of the peons thus shafted, and all the other costs, I'll take a wild guess and say that maybe he's saved 1% for the whole year. But wait, it gets better:

2. It's not like those people were sitting around idle. MS has enough coding going on at any given time, and taking enough flak over, say, Vista delays. So here's the more important part: that "cost saving" is more than offset by the fact that it was a week of them not producing stuff for MS. We're not talking a factory who's over-produced taking a week off, but forcing it onto people who were actually producing value for the company during that time. It's as idiotic a decision as, say, closing a bunch of Wal-Mart shops for a week: sure, you've saved the money for running them for a week, _but_ you've made a bigger loss by not selling anything in that time. So far from being a "cost-cutting measure", it was more like a profit-losing measure.

3. It was done purely for greed sake. It's not like MS was making heavy losses and needed that kind of penny-pinching to stay afloat. Forcing people to take unpaid time off when the company is making a healthy profit is... just pure unhealthy greed. Nothing more, nothing less.

4. It was accompanied by a drop in morale. Partially also because we're talking about people smart enough to understand points 1 to 3, and recognize a _stupid_ penny-pincher when they see one. Being shafted when the company is in dire straits is one thing, but being shafted for such a completely idiotic reason tends to leave a very bad aftertaste. Even if number 2 hadn't already done more harm than good, we're talking a loss of morale that'll span many months and for some people it will even stay around for ever. And it won't even affect only those shafted, but also the people who got to see their co-workers shafted by a dumb PHB. This alone is more than enough to cause more harm than any cost-savings he might have made.

So basically we're not even talking about a regular penny-pincher, we're talking about the dumbest kind of a PHB. The kind that makes the original PHB from Dilbert actually seem smart and competent by comparison. And the dumbest kind of decision one can do at a company.

And yet Wall Street loves him for it and likes the idea of him as a CEO...

I don't know... I really don't know... Are these people even focused on profit, or share value, or whatever, or are they just getting their jollies from shafting the workers and using profit as just an excuse?

Re:Ballmer shouldn't step down.

Yes, I think the chair jokes are on their last legs.

Maybe they are not mistakes

Whose to say Gates made a mistake letting google and yahoo create web based software? It's MS modus operandi to let others pioneer a field then they take it over. We all know the PC story and how IBM and apple and others pioneered it. Same with Wordprocessing and office software. And what about Programming IDEs?.

Now look at what is happening in the field of PDAs and telephones. And of course there's the Xbox which came lat to the party as well. And one might even speculate MS will make a bigger move on the Server side of computing soon.

MS is always late the to party. Pioneers get the arrows. Settlers get the land.

One can hardly say that google's web apps are either the wave of the future or that in the End it won't be MS that controls them. There was nothing defective about Gates strategy, it has worked in the past quite well.

Re:Maybe they are not mistakes

We all know the PC story and how IBM and apple and others pioneered it. Same with Wordprocessing and office software. And what about Programming IDEs?. Now look at what is happening in the field of PDAs and telephones. And of course there's the Xbox which came lat to the party as well.

MSN is another good example

Gates deserves blame for missing the wave of Web-based software that has propelled Google and Yahoo.

I really don't think Google and Yahoo are microsofts problem. If you ask Joe Shmoe CEO who is starting a business what kind of software he needs, he's still going to say "Outlook, Word, Excel".

The real problem with microsoft is they can't innovate with new versions of their old products. .net isn't that hot, Vista is taking forever, nothing special is going on with office, MSN doesn't stand out in any way, SQL server doesn't seem like anything special compared to oracle or even MySQL. The only thing it seems they are making progress with is the X-Box 360 and Live Arcade.

Also from the article:

Losing both Gates and Ballmer will spell a big change for Microsoft. But it's likely to be a positive one. At this point, Ballmer's associated more with the hard-charging business tactics that led to Microsoft's antitrust woes and a low stock price that's sapping employee morale.

The drive of Gates and Ballmer may have led to antitrust woes, but they also drove Microsoft to be the #1 software company in the world. Give the devil its due.

more info on the EU anti-trust case

Indeed, the MS anti-trust case is going well for us [fsfeurope.org].

Leave Ballmer in place

The entire linux community (and probably Mac as well) is strongly in favor of him remaining!

Word

Right, why don't they bring a bunch of new MBA students in to replace them. The fresh new non-tech oriented ideas will surely revitalize the company. /sarcasm meter explodes

Actually, Wall Street would love that

Actually, Wall Street would love to do the standard rise-the-stock-value-so-we-can-sell-even-if-it-kil ls-the-company dance:

- bring in a new CEO who promises radical cost-saving changes all over the place (watch stock value invariably rise)

- have him fire half the workforce, accompanied by giving interviews all over the place about trimming the fat and returning to good ol' capitalism values (ditto)

- make it an official policy to only hire re-trained ex-burger-flippers and transfer half the remaining jobs to Elbonia and East Bumfuckistan in the next years (look at all those money we were wasting on paying highly-qualified people. Stock price rises some more.)

- "motivate" the remaining employees with mottos like "your job could be the next one that goes to India", and unrealistic productivity demands. Accompany it with some speeches showing that you see them as a bunch of slackers, just to be sure they have no illusions left that their contribution is appreciated in any form or shape. (Hell, yeah, high productivity here we come. Watch everyone buy MS stock, driving the share value even higher.)

- drop half the products, on account that they weren't directly making that much money. Never mind that they help form the interlocking whole that makes MS almost impossible to displace in the market. (Ditto.)

- sell the relevant IP and know-how to competitors for some quick cash (yeehaw, MS income was above estimates this quarter. Let's all rush to buy their shares.)

- spin off and sell half the acquisitions that MS ever made. Preferrably for less than half the price originally paid for those companies. (Ditto.)

- reshuffle departments and internal policies for no good reason, just to seem like you're doing something new and radical (ok, by this point it only adds a few more cents per share, but it's better than nothing, you know?)

- announce some hare-brained new products, but miss the mark or the market by a mile because of having no fucking clue about the technology involved

- rape the brand recognition, as much as MS does have of it, for some quick buck for the next quarter, at the expense of annoying and losing existing customers

- take some more flashy measures that'll get lots of press like suddenly rebranding to a new name (and losing most of the brand recognition the old name had), moving to another town, "reinventing oneself" by moving completely into a new market, or whatever

At this point the big Wall Street names sell their own stock, making a quick profit. The company starts a long and painful downward spiral, a la SGI, except MS has cash reserves to last much longer. The CEO soon moves to another company, with Wall Street's full backing, to do the same again. A few years down the line, MS is as relevant to the OS market as SGI now is to the computer graphics market, but Wall Street have gotten their quick buck already.

Think I'm exaggerating? Look at what happened to SGI, for example, and then tell me I'm exaggerating. It only took one bright new CEO to do more than half of what I wrote above, and set SGI on a downwards spiral from which it never recovered. Where SGI is now, you already know.

Re:Actually, Wall Street would love that

Oh, oh, I know this one! They should hire Carly Fiorina! She could wreck Microsoft in no time flat!

He's in a no-win situation..

If Ballmer and Microsoft had been wildly successful over the past few years most everyone here would be crying for the Microsoft juggernaut to be sunk or TOTALLY disbanded via political / legal means.

But many say they haven't been wildly successful over the past few years.

Either way the result is the same: people who don't like Microsoft are going to take pot-shots at them.

also cue monkey boy jokes

ballmer's big problem is he is inflicted with IP disease... he thinks MS owns all of its code, PLUS all of the data and programs folks put on their computers.

and he needs a cure or he needs to leave, cash in his options, and disappear to a tropical island someplace under a volcano. like seeks like.

While we're at it ..

# Comments are for wusses
chant()
    for {Microsoft.Employees}
        do
        print "Why %borg should step down." (Microsoft.Employees)

rejoice()
    for a = 1 to 1000000000
# This comment does nothing, like comments are good for anything anyways.
    print "REJOICE! The evil Empire is dead! Long live the mighty penguin!"

main()
    while Microsoft.Exists=1
        chant()
    rejoice()

Re:While we're at it ..

Don't forget:

public void runMicrosoft(String stuffToDo) throws Chair
{
  if(stuffToDo == "kill fucking Google")
  {
      throw new Chair("executive swivel");
  }
.....
}

Pundits Gone Wild!

The article quotes Rob Enderle:

"It's not likely that Ballmer will stay on as CEO after Gates steps down as the company's chief software architect", says Rob Enderle, principal analyst at the Enderle Group, who has watched Microsoft (Charts) for almost 20 years. "When you get into a cycle like this, the founders go reasonably soon after each other," says Enderle.

Putting aside Rob Enderle's other failures as an analyst, I see him as simply trying to get back up on the wave of punditry that he completely missed with the revelation of Bill Gates leaving. If Ballmer doesn't leave, no one will care. If he does, then Enderle looks like he has an inside connection or excellent prognostication ability.

In reality, I don't see Mr. Ballmer leaving any time soon. The revolt wasn't due to the shareholders as much as Bill Gates just (apparently) getting sick of the day to day. Steve doesn't seem to share that boredom and he certainly doesn't have the hubris to realize that his leaving would be more beneficial to the stock price than any policy he enacts while in the driver seat.

Steve Ballmer != Paul Allen

Enderle appears to be ignorant of Microsoft history, despite his claimed 20-year record. The other Microsoft founder left many years ago (long before Gates).

Ballmer was just an employee. Gates supposedly promoted him because he was buying stock while other insiders were selling it, demonstrating his faith in the company (and making him very rich, as this was back when MS was much smaller).

Microsoft without Ballmer

is like zoo without monkey.
http://video.google.com/videoplay?docid=1704605405 04066962 [google.com]

Unproven business model

"Gates deserves blame for missing the wave of Web-based software that has propelled Google and Yahoo"

Google and Yahoo's entire business model is web-based and advertisement based. One could just as easily argue that they deserve blame for having such a fragile model. It's not clear if building these web-based applications will be profitable or sustainable. Google in particular seems to be enjoying the same kind of unquestioning support that many dead dot-comms enjoyed.

Re:Unproven business model

This is so obviously wrong I was going to ignore it. But I just can't.

Have you looked at their financials? How are billions in revenue not sustainable? Even before getting money from floating stock Google was making a fortune. And Yahoo SURVIVED the dot-com fallout. Their future could easily turn for the worse, but for years they've proven profitable and sustainable.

Re:Unproven business model

Google and Yahoo's entire business model is web-based and advertisement based. One could just as easily argue that they deserve blame for having such a fragile model. It's not clear if building these web-based applications will be profitable or sustainable. Google in particular seems to be enjoying the same kind of unquestioning support that many dead dot-comms enjoyed.

And Microsoft's entire business model is monopoly based. One could just as easily argue that it deserves the blame for having such a fragile model. It's not clear that Microsoft will be profitable or sustainable, in a world where their monopoly starts to fade (look at the multi-billion dollar losses in the Xbox division, or the losses in the MSN division). In particular, Microsoft seems to enjoy the same kind of unquestioning support that AT&T once did. Where's AT&T now? That's right; dead and bought for the name rights.

On the other hand, Google's balance sheet [google.com] is solidly positive. Might be a bit overvalued at $391.00 per share, but that's neither here nor there.

i have three words for you

i love this company

Why should he step-down???

Two words:
Crazy [google.com]
lunatic [google.com]

There he is!! In the window on the left. GET HIM!

Armed with pitchforks and torches, the angry mob of investors and users converged upon the Microsoft campus in Redmond. Chairman Bill had long left the area for the safety of other countries. Although his travels were charitable in name, The Chairman's main intent was to place large moats between him and the beligerent American mobs. And now, the evil president created by the chairman was left to his own devices. President Ballmer was trapped. And there were only a few chairs left in the room. He began to panic; what could he throw to show his might?

Management so bad... Oh Really ?

MSFT sales figures are skyrocketing..

Xbox 360 Sales figures by Peter Moore at E306
http://www.youtube.com/watch?v=cnufsctQnpU [youtube.com]


Full 1 hour Microsoft E3 press conference (May 10th 2006)
main speech comes after the "Gears of War" showdown, its worth the wait..
http://www.youtube.com/watch?v=cnufsctQnpU [youtube.com]

Some sort of change is needed

I'll be the first to admit that I'm not Microsoft's #1 fan - I find thier business practices less than satisfying, and their software usually doesn't light my fires, but I have to give them a lot of credit for their business sense, so I'd like to see them do better.

Whether Ballmer leaves or not, there needs to be a shake up in the direction of the company, because in my mind, they've lost sight. Right now, they remind me of Sony: floundering about, trying to do several things at once, and not really winning either user love or support. They throw money at problems in the hope of winning something, but it doesn't seem like they really know what they are going to do when they get there except have another potential monopoly - and I think that's where they are failing. They're trying to recreate the Windows dominance, instead of just competing.

In a sense, it seems like what they keep trying to pursue is power, not money. And it keeps costing them user loyalty and potential revenue.

Take the Xbox: a $4 billion dollar loss. People can get up and shout "But they're number 2 in console sales", but they have lost $4 billion dollars, and it doesn't seem like they're going to do any better this time. Already the 360 in Japan has been a flop (even interesting looking games like "99 Nights" hasn't helped, through perhaps "Lost Planet" and "Blue Dragon" (if I got the name right) might help), their Xbox lead made users irritated by claiing that "nobody cares about backwards compatibility", a stance that he had to back pedal from as fast as possible. Then again, Sony's trying to figure out how to shoot their foot while sticking it in their mouth at the same time, so maybe they have a chance unless the Wii is as cool as people expect it to. But the Xbox division seems intent on "dominating" the gaming industry. As a counterpoint, look at Nintendo: 3rd place (whenever you take out the handhelds, which I never understand why people ignore), but profitable - and they don't care about being "first", just in making money on every sale.

Cable TV chasing, application server in big iron areas that hasn't panned out - it just seems like Microsoft's just throwing darts at a board, from what seems like an infinite supply of darts supplied by the Office and Windows monopoly. But if Google chips a little bit there, Apple a little bit there, all of the sudden bleeding money doesn't seem like a good idea.

My recommendation: they focus on what will make them money, not what will get them power. My father once made a comment that Bill Gates is intent on keeping Larry Ellison the 2nd richest man in the world (or in that area) by not porting MS SQL Server to Linux, Solaris, OS X, and everything else that they can. What if MS Office was *truly* ported to OS X (including true Outlook support instead of the "almost but close" version), with MS Project and Visio, and on Linux?

Instead of trying to make the world "support our monopoly", new leadership at Microsoft could focus on "what makes money?" Yes, there is a danger in making, say, SQL and Office for OS X and Linux, because that would potentially decrease the Windows desktop sales. But at the same time, it could ensure that if Windows ever goes away, they still have a steady source of income in the future - and it could make them a lot of money now.

It's a hard change to go from "We dominate the PCs, leverage that dominance and protect it" to "What do our customers want, and how can we fill that gap". Windows dominance has worked so well for so long, that I don't think MS can chance until that dominance is truly challenged. If Apple gets some sort of DarWine system working, if Vista keeps getting delayed, if Google actually makes the OS not matter - MS could be in trouble.

Granted, the odds are, nothing's going to happen to MS. People have predicted their demise for years, and I don't see things changing for them for 10 years. On the other hand, you never know when that "next big thing" that blows away the cu

a recipe for microsoft

Although I HATE giving advice to MS..here it goes.

1. Get out of the OS biz!

2. License the Windows API's and other protocols that have practically become de-facto standards to ANY os vendor that wants to use it in their OS. Charge a per/seat license that is similar to the cost of windows now.

In one fell swoop windows apps would still be what people use/develop (for the most part) and they would not have to worry about all the security headaches the OS has given them. They can make the same amount of money by charging the OS vendors. Linux vendors would give users the option of buying windows application compatibility and I'm sure Apple would as well.

He should step down

Before Redmond runs out of chairs.

Real issue is stock options

Today's WSJ noted that Microsoft backdated its monthly stock option issues from 1992 to 1999 to coincide with its stock's monthly lows. While not strictly illegal, depending on how it was accounted for, the practice was quietly discontinued in 1999 and it's stinky in the current regulatory climate. This should come as no more of a shock than Jeff Skilling's abrupt retirement from Enron. Not saying the two are even remotely related in substance or gravity, but such departures usually happen for a reason that isn't good. Also, given the company's current malaise, it might be a good idea for the current leadership to step aside and let some fresh faces take a crack at running the company.

Missed opportunities?

"Gates deserves blame for missing the wave of Web-based software that has propelled Google and Yahoo."

Yes, instead they concentrated on making software people actually pay good money for. Google and Yahoo have revenue based for the most part on ads. MS is not in the ad business, though I am sure they sell a few on MSN, it's not really what they are good at.

MS didn't 'miss the wave', they just continued to make their spectacularly successful products even better, and made a lot of money in the process.

I am certainly glad that the google's and the yahoo's of the world exert competitive pressure on MS, which helps it overcome its monopolistic inertial. But this impetus is best directed towards adopting and innovating in its core business however. Leave search to google, but if Google Office has some interesting ideas, by all means, MS should use them, improve on them, and hopefully come up with innovative new ideas in an effort to best Google.

Tags

Tags : Chair (tagging beta)

Now we need to mod tags as well ;)

Steve Ballmer is Microsoft

As Steve has gotten older and fatter, so has the company. As Ballmer's temper and desire to kick has been moderated by exposure, so has the company lost its edge.