The WSJ has a piece on the fact that Microsoft after four months hasn't chosen a successor to CEO Steve Ballmer. Yes, this is a comparatively long period as corporate searches go, and yes the issues they point out real, if not obvious. Both co-founder Bill Gates and his hand picked, ineffectively long serving CEO Ballmer are still on the board, which creates problems for a successor who wants to clean sweep the company. The bizarre presence of Value Act investors on the board means that they are suggesting one of several possible value enhancing strategies which are out of step with incrementalism.
All of these are symptoms of the real underlying problem: Microsoft's current corporate structure is inefficient and ungovernable, if the goals are to use capital efficiently, create incentives for employees, maximize its market opportunities and to create substantial shareholder value. Looking to one messianic leader to exert magic with the current structure, culture, board and legacy of mediocrity has to have proven extremely difficult. The good news is that in this case, taking time is much better than being rash.
Microsoft needs a major reboot with new leaders, incentives, structures and board. Technology buyers, especially on the corporate side, have to be hoping that their needs will be addressed by an energized and industry-leading player. If the board does its job well, perhaps that will be a new Microsoft.
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