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7/26/2014
08:36 AM
Michael Endler
Michael Endler
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Microsoft's Nadella: More Than Talk

Microsoft CEO Satya Nadella proves he can be a man of action with the biggest layoff in company history and other concrete steps to reshape Microsoft. Now what?

Microsoft lean and focused will infuse it with a startup's soul, as Nadella intends. But after talking about creating a "challenger mindset" at Microsoft, Nadella is now actively trying, at a very large scale, to make that happen.

On the enterprise and infrastructure sides, Microsoft clearly is performing well. Not everyone is persuaded by Nadella's cloud vision, but by focusing on hybrid products that bridge its on-premises server business with Azure, Microsoft is balancing its massive customer base and its future goals.

In these areas, Nadella's pet phrases make the most sense. His references to "ambient intelligence" and "ubiquitous sensing" tap clearly into the Internet of Things and its legion of environment-sensing, big-data-feeding connected devices -- the kinds of things for which Microsoft currently is preparing its cloud and data products. Likewise, his other talking points -- "productivity and platforms" and "mobile-first, cloud-first" products -- align to Microsoft's base catalogue much more easily than Ballmer's "devices and services" plot did. It makes sense for Microsoft to deliver services through the cloud, and to harness both Office's ubiquity and Microsoft's role as a major server player as foundations for delivery. It did not make sense to add a wholly unproven product category -- devices -- as a would-be strategic cornerstone.

Nadella's Nokia reductions include the elimination of the Nokia X smartphones, which layered Microsoft services on an Android base.
Nadella's Nokia reductions include the elimination of the Nokia X smartphones, which layered Microsoft services on an Android base.

But things are murkier on the operating system and device side. Nadella is committed to putting Microsoft products on all platforms, iOS and Android included. He also remains committed to Windows, and to first-party devices such as the Surface Pro -- though he bent over backward reassuring investors last week that Microsoft isn't "in hardware for hardware's sake."

That's a lot to balance, especially for a company that's playing from far behind in mobile, and losing some of its consumer share in traditional PCs. Nadella's repeatedly described his intentions for a faster, less-bureaucratic, and more-collaborative management style -- and he'll need it. Microsoft might manage to juggle it all, but it's hard to not see the potential for strategic contradictions to arise.

Nadella has hyped Cortana and other contextually-aware technologies as game changers but Microsoft still has to prove its vision.
Nadella has hyped Cortana and other contextually-aware technologies as game changers but Microsoft still has to prove its vision.

Nadella has begun to describe the actions he'll take to integrate what's left of Nokia's device business, and to make Windows a viable mobile platform. Some of his intentions are still vague, such as what specific benefits we'll see from the converged core that will soon power all versions of the OS, mobile and desktop alike. Will it just offer convenience to makers of simple apps, or will it transform the way we use and think of Windows across devices?

Nadella's declaration that devices will serve to "light up" Microsoft's digital experiences is appealing. It focuses on differentiating Microsoft's strengths, rather than keeping up with whatever Apple is up to. But if Nadella is going to offer first-rate Microsoft services on iOS and Android, what more can a Windows device add to "light up" the experience?

Microsoft has lightly fleshed out the idea. Even if Cortana becomes a cross-platform product, it will likely remain most closely tied to Windows Phone hardware, giving the digital assistant the ability to do more with contextual information, for instance. Nadella has also cited the Surface Pro 3's superlative digital inking experience as an example. Neither of these is necessarily a game changer but they prove a point: Even if Microsoft makes the best possible product it can for iOS or Android, devices that run those OSs are still limited in certain ways, which gives Microsoft room to explore new avenues.

Still, Nadella has a long way to go. On the enterprise side, Microsoft enjoys momentum today -- but Nadella has hinged tomorrow on ideas such as Delve, an Office 365 app that uses machine learning to discover what, how, and with whom you work, and to deliver information it thinks you'll need. It's tantalizing to think of a product that knows what you want before you do, but the concept is unproven and will test Nadella's promises that Microsoft will excel at data management and privacy. Nadella's device and Windows plans, meanwhile, are only just gaining focus, and will put pressure on the company's 2015 slate. That's when we should get our first full look at the company's post-Nokia device efforts and the next version of Windows.

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Michael Endler joined InformationWeek as an associate editor in 2012. He previously worked in talent representation in the entertainment industry, as a freelance copywriter and photojournalist, and as a teacher. Michael earned a BA in English from Stanford University in 2005 ... View Full Bio
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Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
7/28/2014 | 1:20:10 PM
Re: Let's be a little more serious about the word 'action.'
@Lawler It's hard to think of Nadella as an enforcer hired by the board to fire thousands of people and then parachute out. Companies usually bring in an outsider for that kind of grim business. Nadella seems emotionallly invested in the complex task of streamlining Microsoft for the long haul. He doesn't fit the profile of a hatchet man.
Lorna Garey
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Lorna Garey,
User Rank: Author
7/28/2014 | 12:29:34 PM
AD integration
Michael, In terms of "It did not make sense to add a wholly unproven product category -- devices -- as a would-be strategic cornerstone." That's debatable -- I have heard that Microsoft is extending AD with things like federation and hybrid cloud integrations, which is smart for keeping enterprise IT on board with its own hardware and Windows. Identity and directory management are an important trump card. 
pcharles09
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pcharles09,
User Rank: Ninja
7/28/2014 | 9:48:21 AM
Re: Let's be a little more serious about the word 'action.'
@heartpuppy

Does 'best' equal 'most expensive'?
RZIMMERMANN
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RZIMMERMANN,
User Rank: Apprentice
7/28/2014 | 12:52:37 AM
Microsoft Nokia division is not based here in US
It is located in Finland and majority of workers are there. Please keep that in mind before generalizing issues. OK now carry on with your pet themes.
heartpuppy
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heartpuppy,
User Rank: Apprentice
7/27/2014 | 11:59:18 PM
Re: Let's be a little more serious about the word 'action.'
Can't agree with you more!   Plus the way the layoff
 is carried out, calculated to drive out the best people
 from Microsoft.
heartpuppy
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heartpuppy,
User Rank: Apprentice
7/27/2014 | 11:56:22 PM
Re: Protracted Layoffs
It's the American way to fight something that's so wrong.  Let's not give up!
mrbillbenson
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mrbillbenson,
User Rank: Apprentice
7/27/2014 | 9:44:44 PM
Re: Protracted Layoffs
Our government and large American domeciled corporations with and without global workforces have sold out the American worker. We'll be lucky if we are left any place at the table whatsoever. America is doomed.
sidmeka
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sidmeka,
User Rank: Apprentice
7/27/2014 | 9:20:29 PM
Re: Protracted Layoffs
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/10/16/meet-cgi-federal-the-company-behind-the-botched-launch-of-healthcare-gov/
jastroff
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jastroff,
User Rank: Ninja
7/27/2014 | 12:26:59 PM
Re: Let's be a little more serious about the word 'action.'
Agree.

 

>> With the announcement of 18,000 layoffs, Nadella has shifted into action.

Laying off people isn't action, otherwise, with all the layoffs in the last decade, everything would be "fixed" by now

 

 
heartpuppy
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heartpuppy,
User Rank: Apprentice
7/27/2014 | 10:08:34 AM
Re: An acquisition mistake?
Nokia like Motorola was very badly Indianized.   See my other comments

about the "competitive advantage of Indianization", it's a negative benefit.

NonIndianized companies like Samsung/Apple/Google will always whip the Indianized

company's ass.    Microsoft is currently less Indianized but will be, if Satya

gets his way.


See my other comments about Satya's "protracted layoff".

 

When a massive Indianizing company buys another Indianized company,

then the purchase will faciliate great many Indians jumping ship

into the new mothership, while the old ship will be discarded

with all the nonIndian workforce called "baggage".

The whole process will be called "painful but necessary"...

 

 
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