AIB Featured Business Leader – Satya Nadella
Satya Nadella has his head in the clouds. Or, rather, in the cloud. The current CEO of Microsoft is a strong advocate of Azure, Microsoft’s cloud computing platform, as one of its strongest future-forward products. “There are not that many 41 year old tech companies,” says Nadella about the need for Microsoft to embrace innovation even into its middle age.
Nadella was born in Hyderabad, a city in the south of India. The young Nadella went to the Hyderabad Public School where he was known as an above-average student and keen cricketer. Playing cricket, Nadella would later say, taught him about working in teams and displaying leadership. In fact, his original ambition was to play professional cricket, not an unusual desire in cricket-obsessed India, but as he grew, his interest in science and technology eclipsed his love of the sport.
Nadella went on to study a bachelor’s degree in electrical engineering at the Manipal Institute of Technology. There, his interest in science blossomed into a fully-fledged passion, and upon graduating in 1988, he looked for ways to further that passion. Finding the opportunities in his home country limiting, he travelled to the United States and completed a Master of Science in Computer Science.
In 1991, he joined Sun Microsystems as a technologist but just one year later jumped ship to Microsoft. In 1992, Nadella was one of only 30 Indian immigrants working at Microsoft. Bill Gates was the CEO, Windows was on the rise, and one of Nadella’s first projects was the Windows NT operating system, first released in July 1993. During his first years at Microsoft, Nadella also commenced studying an MBA at the University of Chicago’s Booth School of Business. Patiently, he shuttled back and forth from Seattle every weekend until he graduated in 1997.
Nadella was promoted steadily within Microsoft, landing his first executive role in 1999 as the Vice-President of Microsoft bCentral, a suite of web services for small business. He was also instrumental in developing the search engine Bing. By 2007, he was the Senior Vice-President of Research and Development for the Online Services Division, a role that he held until 2011 when he became President of the Server and Tools division.
Back in 2000, Microsoft founder Bill Gates stood down as CEO but remained chairman of the board. Steve Ballmer became the new CEO. Gates staggered his departure over several years, remaining as Chief Software Architect until 2006 when he passed that mantle over to Ballmer as well. While Microsoft revenue surged in the early years after the change, share price stagnated under Ballmer’s leadership. By 2012, critics were loud in calling for his resignation, including a Forbes article which described him as, “the worst CEO of a large publicly traded American company today.”
Ballmer hung on for a while, but in August 2013, Microsoft announced on his behalf that he would shortly retire. The search for a new CEO began, with a special committee including Bill Gates convened to choose a successor. The search wasn’t simple, with obvious successors knocked out of the running for various reasons. Eventually, on 4 February 2014, Nadella was announced as only the third CEO in the company’s history, with a reported salary package of $84 million.
In a statement, Gates called Nadella “a proven leader with hard core engineering skills, business vision and the ability to bring people together.” Almost four years later, his confidence seems well placed.
Nadella has prioritised Azure, Microsoft’s cloud computing platform, as the future of the company’s server business. Where others have been concerned that the push to cloud computing will threaten other sectors of Microsoft’s product range, Nadella sees it as massively expanding the available market for products. He’s also pushed the company to invest heavily in Cortana, a personal digital assistant which uses AI to predict and respond to individual needs.
As well as product development, Nadella has led Microsoft into acquisitive territory. In 2014, it bought the hit game Minecraft, and in June of 2016, it added LinkedIn to its portfolio for a reported $26.2 billion.
Asked about the future of the company, Nadella is excited. The growth of cloud computing is one focus; AI technologies are another. Above all, he is re-conceptualising the company as service-based, where it has historically been about product provision, and is aggressively exploring market expansion into developing countries. He is also laser focused on changing the culture of the company from the Ballmer era, and carefully monitors productivity to see where he can improve and where his employees can do better.
What next for Microsoft under his steerage? “To paraphrase a quote from Oscar Wilde – we need to believe in the impossible and remove the improbable,” said Nadella. Whatever that leads to will certainly be worth watching.
This article was written by Tanya Ashworth-Keppel on behalf of the Australian Institute of Business. All opinions are that of the writer and do not necessarily reflect the opinion of AIB. The following sources were used to compile this article: Bloomberg, Business Insider, Business Insider Australia, Forbes, Sunday Guardian, Gadgets 360, The Telegraph and Time.
Image credit: Windows Central