So then Ballmer Aftermath part 3. This one will be short, I promise. So part 1 was impacts to Microsoft's mobile business. Part 2 in this trilogy was the impact to Nokia which had married itself to Windows Phone and Ballmer. And now Part 3, about Ballmer's successor. Can that be Elop of Nokia.
So yeah, many biz and tech writers are including Nokia CEO Stephen Elop as a potential Microsoft CEO to replace outgoing Steve Ballmer. That would have been a plausible option some time back. If Ballmer had left on his own terms, as a hero CEO of high standing, he could have selected his successor. And Ballmer clearly liked how Elop was emulating Ballmer. Elop has tried to become the 'Mini-Me' of Ballmer. Elop often has spoken more like a true Microsoftian while being Nokia CEO, than Ballmer himself.
WHAT COULDA
If the Nokia partnership for Microsoft had turned out well, with Microsoft now controlling something like 20% or 30% of the smartphone market - as was promised (Elop promised a 1-to-1 transition from Symbian to Windows Phone, would mean 33% market share just by Nokia, plus a few more points of share by HTC, Samsung and the others on top of that) - then yes, Elop would be the hero at Microsoft offices now, and incidentially, Ballmer would not be departing.
There are press stories that it was the 900 million dollars wasted in the Surface tablet launch, which was the straw that broke the camel's back, in other words ended Ballmer's tenure as Microsoft CEO. If you think 900 million dollars wasted is bad, to have a trivial gain in market share, consider Ballmer's performance with Windows smartphones.
Before Ballmer brought the Nokia partnership in with Elop, Microsoft held 5% market share in smartphones in 2010. Today, after Nokia's 33% has been wiped out in the transition, and 100% of Nokia smartphones are Windows based, what is the global market share of Windows Phone? Is it 30%? No. Is it 20%. No. Is it 10%. No. Is it even the 5% he had before this partnership launched? No. Windows Phone has 4% today. And what has this cost Microsoft so far? Microsoft has paid already more than 2.5 Billion dollars in marketing support to Nokia (plus countless more to carriers and developers) - and achieved a MINUS ONE PERCENT POINT gain, yes a one percentage point LOSS to Microsoft's smartphone share. 2.5 Billion dollars to lose you one percent in market share, I think this was another 'significant part' in why Ballmer was told to pack his bags and resign, before he is fired by Gates. Gates can read the numbers and if Surface was bad, Windows Phone was a disaster for Microsoft.
This is why Microsoft Chairman Bill Gates said in February on Charlie Rose, that Ballmer has made some mistakes, and Windows Phone is 'certainly a mistake' - in fact Gates said Microsoft's smartphone strategy had been so badly ruined by Ballmer, that it is now not even recoverable. And yes, if you spend over 2.5 Billion dollars and cannot turn 33% Nokia customers into even a few points of GAIN to Windows, but rather, Windows itself loses in that process, then yes, this is not just broken, this is unrecoverably damaged. There is no future in Windows Phone.
SO CANDIDATE ELOP
So now, lets look at Elop. Elop was Ballmer's boy. They were the BFFs, seen on world stages together. If it was up to Ballmer, Elop would now be succeeding him. And why not? Stephen Elop is an ex Microsoftian. He knows the software business. He has experience with other tech companies from before (Juniper, Adobe, etc) and now Nokia. From Elop's Nokia experience he would bring valuable hardware experience to Microsoft. Elop has been a very loyal Microsoft soldier even when running Nokia (or ruining Nokia, if you prefer). On the surface, Elop seems like an excellent candidate to run Microsoft.
So why not. First, Gates signalled clearly that Ballmer has made some mistakes. What mistake has he singled out to share in public - Windows Phone - the only Microsoft strategy element where Elop is personally involved. If Gates thinks that Ballmer messed up as CEO, and one of his biggest mistakes is Windows Phone - why on earth would Gates hire Elop - the guy who is actually responsible for that mistake? Note, Ballmer did many things right as CEO. Ballmer had many other things to worry about than the smartphone strategy. But Elop was only bothered by the handsets business (over at Nokia) and totally, utterly cocked that up.
Secondly, Gates named Ballmer to replace himself. Gates was very successful as CEO of Microsoft. Ballmer's early tenure continued that success, which arguably was built by Gates and Ballmer initially only continued Gates's plans. Then as Ballmer introduced ever more of his own items and elements, Microsoft went through ever more trouble and pain. So Gates is a smart guy and he learns fast. If Ballmer as type of CEO is the wrong guy now for Microsoft in this era, Gates will not compound that error by hiring another Ballmer-clone. Who is the most Ballmer-istic CEO out there? Elop. If Gates loved what Ballmer did, he'd want another Ballmer. If Gates was so displeased by Ballmer that he actually criticized him in public - then definitely, Gates will seek to find something more like an 'anti-Ballmer'.
So Elop is totally damaged goods. He is associated with Ballmer, a loser now in Gates's mind. Elop is totally linked with Windows Phone, one of Microsoft's costliest mistakes. Elop has shown what he can do when running a highly profitable global tech company - the moment Elop started to execute his own strategy rather than continuing the previous, profitable strategy, Nokia profits vanished and the only quarter Elop was able to produce a miniscule profit since the damage started, was when Elop sold Nokia's headquarters building to create a fake profit moment at Nokia. Gates knows how to read business results. Elop is a disasterous CEO. No matter how you spin it, if Elop created a worse damage than Toyota's crisis with the breaks, worse than New Coke was to Coca Cola or worse than BP's oil spill, yes, Elop is arguably one of the worst CEO's ever, and Gates would never hire such a bad candidate to take over and fix the damage done by Ballmer.
HERE'S A SILLY THOUGHT..
I would expect Bill Gates to learn from his Ballmer-mistake and hire someone as much as possible to be an 'Anti-Ballmer' - so if you saw Elop and Ballmer as two twins, the Evil Twins if you like, then no, Gates would not repeat that mistake by hiring a Ballmer-clone. He'll go the opposite way, get not a software guy, but a hardware guy. Not a Microsoft corporation insider, but an outsider. Not a bully but a friendly cooperative guy. Someone experienced in working through partners in a modern, collaborative environment. If Gates is bold and brave, he'd go outside of Silicon Valley and the West Coast. Especially, if Gates is taking onboard some of the commentary, that Microsoft's time as bullying the industry with a monopolistic market dominant position, is over. If that is the case, then he needs the opposite of a bully now. To give Microsoft a new, friendlier image.
Incidentially, ironically, a name well remembered on this blog, Anssi Vanjoki would be a perfect candidate for that job haha. You want someone truly competent and modern collaborative guy who understands the mobile internet future not the desktop PC past, and comes from the hardware side and is not a Microsoftie, So much not a Silicon Valley dude, he's not even North American, etc.. Wouldn't that be ironic haha..
PS - obviously I would LOVE for Elop to go run Microsoft, because that means he'd depart from his post ot Chief Extinction Officer of Nokia. But also, his strategic vision by 'call me the General' is pathetic, and his management execution is worse even than that. He would destroy Microsoft just as much as he destroyed Nokia so far. I don't want to see Microsoft destroyed, I hope to see Microsoft reborn as a modern, customer-focused company that cares about its partners and suppliers. Elop can't do that for Microsoft.
This was my part 3 of the Ballmer Aftermath Trilogy. Part 1 was about impacts to Microsoft's mobile strategy and Windows Phone. Then Part 2 was the impact to Nokia and its Windows Phone based Lumia strategy. Now I hope we soon will get to write Part 4 - Elop is Fired from Nokia....
So yeah, many biz and tech writers are including Nokia CEO Stephen Elop as a potential Microsoft CEO to replace outgoing Steve Ballmer. That would have been a plausible option some time back. If Ballmer had left on his own terms, as a hero CEO of high standing, he could have selected his successor. And Ballmer clearly liked how Elop was emulating Ballmer. Elop has tried to become the 'Mini-Me' of Ballmer. Elop often has spoken more like a true Microsoftian while being Nokia CEO, than Ballmer himself.
WHAT COULDA
If the Nokia partnership for Microsoft had turned out well, with Microsoft now controlling something like 20% or 30% of the smartphone market - as was promised (Elop promised a 1-to-1 transition from Symbian to Windows Phone, would mean 33% market share just by Nokia, plus a few more points of share by HTC, Samsung and the others on top of that) - then yes, Elop would be the hero at Microsoft offices now, and incidentially, Ballmer would not be departing.
There are press stories that it was the 900 million dollars wasted in the Surface tablet launch, which was the straw that broke the camel's back, in other words ended Ballmer's tenure as Microsoft CEO. If you think 900 million dollars wasted is bad, to have a trivial gain in market share, consider Ballmer's performance with Windows smartphones.
Before Ballmer brought the Nokia partnership in with Elop, Microsoft held 5% market share in smartphones in 2010. Today, after Nokia's 33% has been wiped out in the transition, and 100% of Nokia smartphones are Windows based, what is the global market share of Windows Phone? Is it 30%? No. Is it 20%. No. Is it 10%. No. Is it even the 5% he had before this partnership launched? No. Windows Phone has 4% today. And what has this cost Microsoft so far? Microsoft has paid already more than 2.5 Billion dollars in marketing support to Nokia (plus countless more to carriers and developers) - and achieved a MINUS ONE PERCENT POINT gain, yes a one percentage point LOSS to Microsoft's smartphone share. 2.5 Billion dollars to lose you one percent in market share, I think this was another 'significant part' in why Ballmer was told to pack his bags and resign, before he is fired by Gates. Gates can read the numbers and if Surface was bad, Windows Phone was a disaster for Microsoft.
This is why Microsoft Chairman Bill Gates said in February on Charlie Rose, that Ballmer has made some mistakes, and Windows Phone is 'certainly a mistake' - in fact Gates said Microsoft's smartphone strategy had been so badly ruined by Ballmer, that it is now not even recoverable. And yes, if you spend over 2.5 Billion dollars and cannot turn 33% Nokia customers into even a few points of GAIN to Windows, but rather, Windows itself loses in that process, then yes, this is not just broken, this is unrecoverably damaged. There is no future in Windows Phone.
SO CANDIDATE ELOP
So now, lets look at Elop. Elop was Ballmer's boy. They were the BFFs, seen on world stages together. If it was up to Ballmer, Elop would now be succeeding him. And why not? Stephen Elop is an ex Microsoftian. He knows the software business. He has experience with other tech companies from before (Juniper, Adobe, etc) and now Nokia. From Elop's Nokia experience he would bring valuable hardware experience to Microsoft. Elop has been a very loyal Microsoft soldier even when running Nokia (or ruining Nokia, if you prefer). On the surface, Elop seems like an excellent candidate to run Microsoft.
So why not. First, Gates signalled clearly that Ballmer has made some mistakes. What mistake has he singled out to share in public - Windows Phone - the only Microsoft strategy element where Elop is personally involved. If Gates thinks that Ballmer messed up as CEO, and one of his biggest mistakes is Windows Phone - why on earth would Gates hire Elop - the guy who is actually responsible for that mistake? Note, Ballmer did many things right as CEO. Ballmer had many other things to worry about than the smartphone strategy. But Elop was only bothered by the handsets business (over at Nokia) and totally, utterly cocked that up.
Secondly, Gates named Ballmer to replace himself. Gates was very successful as CEO of Microsoft. Ballmer's early tenure continued that success, which arguably was built by Gates and Ballmer initially only continued Gates's plans. Then as Ballmer introduced ever more of his own items and elements, Microsoft went through ever more trouble and pain. So Gates is a smart guy and he learns fast. If Ballmer as type of CEO is the wrong guy now for Microsoft in this era, Gates will not compound that error by hiring another Ballmer-clone. Who is the most Ballmer-istic CEO out there? Elop. If Gates loved what Ballmer did, he'd want another Ballmer. If Gates was so displeased by Ballmer that he actually criticized him in public - then definitely, Gates will seek to find something more like an 'anti-Ballmer'.
So Elop is totally damaged goods. He is associated with Ballmer, a loser now in Gates's mind. Elop is totally linked with Windows Phone, one of Microsoft's costliest mistakes. Elop has shown what he can do when running a highly profitable global tech company - the moment Elop started to execute his own strategy rather than continuing the previous, profitable strategy, Nokia profits vanished and the only quarter Elop was able to produce a miniscule profit since the damage started, was when Elop sold Nokia's headquarters building to create a fake profit moment at Nokia. Gates knows how to read business results. Elop is a disasterous CEO. No matter how you spin it, if Elop created a worse damage than Toyota's crisis with the breaks, worse than New Coke was to Coca Cola or worse than BP's oil spill, yes, Elop is arguably one of the worst CEO's ever, and Gates would never hire such a bad candidate to take over and fix the damage done by Ballmer.
HERE'S A SILLY THOUGHT..
I would expect Bill Gates to learn from his Ballmer-mistake and hire someone as much as possible to be an 'Anti-Ballmer' - so if you saw Elop and Ballmer as two twins, the Evil Twins if you like, then no, Gates would not repeat that mistake by hiring a Ballmer-clone. He'll go the opposite way, get not a software guy, but a hardware guy. Not a Microsoft corporation insider, but an outsider. Not a bully but a friendly cooperative guy. Someone experienced in working through partners in a modern, collaborative environment. If Gates is bold and brave, he'd go outside of Silicon Valley and the West Coast. Especially, if Gates is taking onboard some of the commentary, that Microsoft's time as bullying the industry with a monopolistic market dominant position, is over. If that is the case, then he needs the opposite of a bully now. To give Microsoft a new, friendlier image.
Incidentially, ironically, a name well remembered on this blog, Anssi Vanjoki would be a perfect candidate for that job haha. You want someone truly competent and modern collaborative guy who understands the mobile internet future not the desktop PC past, and comes from the hardware side and is not a Microsoftie, So much not a Silicon Valley dude, he's not even North American, etc.. Wouldn't that be ironic haha..
PS - obviously I would LOVE for Elop to go run Microsoft, because that means he'd depart from his post ot Chief Extinction Officer of Nokia. But also, his strategic vision by 'call me the General' is pathetic, and his management execution is worse even than that. He would destroy Microsoft just as much as he destroyed Nokia so far. I don't want to see Microsoft destroyed, I hope to see Microsoft reborn as a modern, customer-focused company that cares about its partners and suppliers. Elop can't do that for Microsoft.
This was my part 3 of the Ballmer Aftermath Trilogy. Part 1 was about impacts to Microsoft's mobile strategy and Windows Phone. Then Part 2 was the impact to Nokia and its Windows Phone based Lumia strategy. Now I hope we soon will get to write Part 4 - Elop is Fired from Nokia....
Spoke too soon, Tomi? :D
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Of course Elop will now become MS CEo.
King of Trojan horses.
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