There has been much criticism of Microsoft CEO Steven Ballmer over the last few weeks since he announced he’s leaving the company within a year. Some have gone as far as to call him the “worst CEO ever.” He certainly hasn’t been an exceptional CEO. Microsoft’s stock has languished during his tenure, it’s organization has become bloated, and most importantly, it’s missed out on the big technology trends of the last decade – smartphones, tablet cannibalization of PCs, the rise of paid search, cheap cloud computing, Social, etc. But, it seems to me, some of the criticism is overblown.
Without digging too deep, I can think of a few tech CEOs far worse than Ballmer. Leo Apothekar at HP with his ill-conceived acquisition of Autonomy, decision to spin off its PC business, and relationship issues with the Board. RIM’s co-CEOs for their corporate infighting and inability to create an OS challenge to iOS or Android (or go all in on the latter). Or, if you’re looking for a CEO that truly lost his company, how about Stephen Elop, CEO of Nokia, which Microsoft just bought? Nokia used to be one of the world’s most recognized brands, the dominant force in handsets. And now, because of it’s strategic error in aligning itself with Windows Mobile instead of Android, (Nokia should have been what Samsung is to day), it’s selling itself for less than $8 billion.
In terms of stock price, yes, Microsoft’s stock has been essentially flat since the Dotcom bust, which is on Ballmer. See this stock chart I pulled from Yahoo! Finance:
But Microsoft isn’t the only high-flying Dotcom era stock that has struggled in the last decade plus. Check out Cisco to name one company with a similar price trend:
Microsoft could have fared far worse these last 10 years. Ballmer inherited a monopoly business tied to distributing incredibly high gross margin Windows software on PCs. And he inherited this business at its peak. With the growth of Google and mobile computing among other trends, it was always going to be hard to sustain Microsoft’s position as the kind of software and the top destination for tech talent. Tripling revenue and doubling operating profits while creating new billion dollar business lines isn’t bad when seen in this context.
Great CEO? No. Worst CEO ever? Hyperbole, for sure.
Informed Musings 