With the promotion of Satya Nadella to CEO of Microsoft -- only the third chief executive in the company's storied history -- the computer giant is coming up on a watershed moment. The company is still making record profits -- as it did just last quarter -- but we think there are five things the new boss should do to ensure the company's competitiveness in the new age.
1. Bolster its mobile management software strategy
InTune is a product that has steadily incorporated more mobile device management features since its inception as a desktop management service. Plus, the Azure development kit allows for customizable push notifications that play nicely with iOS and Android devices. Microsoft needs to consider buying an EMM company that can boost that offering.
2. Minimize Bill Gates' new advisory role
Former CEO Bill Gates said Nadella asked him to step up to an advisory role within Microsoft. There is probably a loyal contingent of Softies who think the increased role of former CEO Bill Gates would be a boon to the company. While it makes sense for the founder of Microsoft to have an increased role during this transition, it shouldn't be for a prolonged period of time. Gates should guide the new Microsoft CEO through this period, but only for six to 12 months. Gates' software vision is valuable, of course, but his influence could muddy the waters within the company, making observers (and stockholders) wary of who really is in charge.
3. Ditch the Windows Phone software, go all-in on Android software
Since 2008, Microsoft has made a concerted effort at a mobile operating system and device strategy. It's been a slow climb for the company in terms of market share, but Nadella should consider scrapping the whole project all together. Tech journalists, as well as regular human beings, have lusted over the build quality of Nokia's Lumia line of phones, but lament the operating system running it. They want an Android-powered Lumia phone. Not a single Android device manufacturer has been able to do it -- that's where Microsoft can make a play. There are rumors that Nokia has developed an Android phone, but nothing concrete has materialized on that front.
4. … Or get someone (Google's Sundar Pinchai) to run Windows Phone
If Microsoft doesn't want to abandon legacy Windows Phone software, the company should get a leader who's shown he can integrate software from desktop to mobile: Sundar Pinchai, senior vice president at Google. He's shown that he can lead a team capable of integrating something on the scale of Google Chrome's browser with Android -- and could apply that same level of focus to Windows and Windows Phone 8.1, or future operating systems, to lead to a convergence that makes sense. A shared codebase is in the cards for Windows and Windows Phone, but the execution of the experience could be better served in Pinchai's hands. He reportedly turned down an offer to become Microsoft CEO, so it may be a longshot.
5. Maintain status quo with rapid pace of innovation on Azure, Office 365 services
There's a reason why Nadella got the CEO gig: Azure and its online services products are working well for the company -- and they're selling like gangbusters. Continuing to evolve that business is a given. The Cloud OS strategy, by all accounts, is working. Plus, offering Windows Server and its associated data center products alongside the Azure offerings should be the main strategy going forward.
Bonus: Rebrand or kill Windows RT
Windows 8 and Windows RT have made for a confusing, deplorable experience. Windows RT is limited in its capabilities, and its desktop mode is confined to just running the Office suite of applications. It's the equivalent of the Winter Olympics biathlon event: why would you need to ski and fire a gun at the same time? If it doesn't run the legacy apps, like all business customers expect from Windows, it shouldn't be called "Windows." End of story.
This was first published in February 2014