Microsoft on Thursday announced a far-reaching realignment of the company that will enable it to innovate with greater speed, efficiency and capability in a fast changing world. Today’s announcement will enable Microsoft to execute better on its strategy to deliver a family of devices and services that best empower people for the activities they value most and the enterprise extensions and services that are most valuable to business.
Single Strategy Across Different Directions
About a year ago, Microsoft embarked on a new strategy to realize its vision, opening the devices and services chapter for Microsoft. The firm has made important strides, launched Windows 8 and Surface, moving to continuous product cycles, bringing a consistent user interface to PCs, tablets, phones and Xbox. Going forward, Microsoft strategy will focus on creating a family of devices and services for individuals and businesses that empower people around the globe at home, at work and on the go, for the activities they value most.
Starting from today, Microsoft is rallying behind a single strategy as one company, not a collection of divisional strategies. Although Microsoft will deliver multiple devices and services to execute and monetize the strategy, the single core strategy will drive the company to set shared goals for everything it does. Microsoft wants to see its product line holistically, not as a set of islands. Microsoft will allocate resources and build devices and services that provide compelling, integrated experiences across the many screens with maximum return to shareholders.
“Across Microsoft, we are facing incredible new opportunities. As devices become further integrated into everyday life, we will have to create new and extraordinary experiences for our customers on these devices. We are going to focus on completely reinventing experiences like creating or viewing a creative document and what it means to communicate socially at home or in meetings at work. We are going to immerse people in deep entertainment experiences that let them have serious fun in ways so intense and delightful that they will blur the line between reality and fantasy. And as we develop these new experiences, we will also support our developers with the simplest ways to develop apps or cloud services and integrate with our products. We will help businesses that find themselves in a new world of ever-mounting information to manage that information through greater enterprise information assurance. We will make these high-value activities priorities in our strategy,” stated Steve Ballmer, chief executive officer of Microsoft.
Reorganization by Function
Microsoft will reorganize the company by function: Engineering (including supply chain and datacenters), Marketing, Business Development and Evangelism, Advanced Strategy and Research, Finance, HR, Legal, and COO (including field, support, commercial operations and IT). Each discipline will help drive the company’s overall strategy. Each discipline will also be charged with improving the core capabilities in its area.
Specifically, the new teams and their leaders will be these:
- Operating Systems Engineering Group. Terry Myerson will lead this group, and it will span all OS work for console, to mobile device, to PC, to back-end systems. The core cloud services for the operating system will be in this group.
- Devices and Studios Engineering Group. Julie Larson-Green will lead this group and will have all hardware development and supply chain from the smallest to the largest devices the company builds. Julie will also take responsibility for studios experiences including all games, music, video and other entertainment.
- Applications and Services Engineering Group. Qi Lu will lead broad applications and services core technologies in productivity, communication, search and other information categories.
- Cloud and Enterprise Engineering Group. Satya Nadella will lead development of back-end technologies like datacenter, database and specific technologies for enterprise IT scenarios and development tools. He will lead datacenter development, construction and operation.
- Dynamics. Kirill Tatarinov will continue to run Dynamics as is, but his product leaders will dotted line report to Qi Lu, his marketing leader will dotted line report to Tami Reller and his sales leader will dotted line report to the COO group.
- Advanced Strategy and Research Group. Eric Rudder will lead Research, Trustworthy Computing, teams focused on the intersection of technology and policy, and will drive cross-company looks at key new technology trends.
- Marketing Group. Tami Reller will lead all marketing with the field relationship as is today. Mark Penn will take a broad view of marketing strategy and will lead with Tami the newly centralized advertising and media functions.
- COO. Kevin Turner will continue leading worldwide sales, field marketing, services, support, and stores as well as IT, licensing and commercial operations.
- Business Development and Evangelism Group. Tony Bates will focus on key partnerships especially innovation partners (OEMs, silicon vendors, key developers, Yahoo, Nokia, etc.) and the broad work on evangelism and developer outreach. DPE, Corporate Strategy and the business development efforts formerly in the BGs will become part of this new group. OEM will remain in SMSG with Kevin Turner with a dotted line to Tony who will work closely with Nick Parker on key OEM relationships.
- Finance Group. Amy Hood will centralize all product group finance organizations. SMSG finance, which is geographically diffuse, will report to Kevin Turner with a dotted line to Amy.
- Legal and Group Corporate Affairs Group. Brad Smith will continue as General Counsel with responsibility for the company's legal and corporate affairs and will map his team to the new organization.
- HR Group. Lisa Brummel will lead Human Resources and map her team to the new organization.
“Lots of change. But in all of this, many key things remains the same. Our incredible people, our spirit, our commitment, our belief in the transformative power of technology – our Microsoft technology – to make the world a better place for billions of people and millions of businesses around the world. It’s why I come to work inspired every day. It is why we have evolved before, and why we are evolving now. Because we’re not done. Let’s go,” concluded Mr. Ballmer.