What’s up with Microsoft?
A couple weeks ago Steve Ballmer sent The Memo, a periodic ritual at the software giant laying out his vision for the company and outlining a massive organizational restructuring. Entitled “One Microsoft,” Ballmer changes the org chart from looking like GM’s—with dueling divisions, brands, and fiefdoms—to that of Apple’s.
There’s a lot to be said about Apple’s structure. Essentially, it’s a bicycle wheel. Everything used to revolve around Steve Jobs, as it now does around Tim Cook. If something goes wrong, it’s Tim’s fault. If they bring out a new killer product, it’s Tim’s creation. The CEO is at the center of the Apple universe.
But this requires an immensely talented and driven leader. The way Jobs ran Apple worked for him. It works when a dictatorial, charismatic, ruthless, respected, obsessive workaholic takes command. It worked for Apple because Jobs insisted on simplicity. It’s unclear whether it can work with a different commander.
But we can hope. A revitalized Microsoft would be good for everyone.
Douglas R. Tengdin, CFA
Chief Investment Officer