2013-09-05 12:00:00

On the crazy notion of @scottgu as the next Microsoft CEO

Right after Steve Ballmer got fired, I tweeted something about Scott Guthrie becoming the next Microsoft CEO. About a million other people did too.

Another million-ish people chimed in to say that Gu would be a terrible choice or that he had no chance or that the MSFT corporate by-laws don't allow red shirts or whatever.

Most of the resulting flame wars resulted in no shared understanding. Some were able to find a piece of common ground that could loosely be described as "technical knowledge is good".

Personally, I just want Guthrie to be CEO because I met him once. Whenever possible, I try to make everything about ME.

If I were on Microsoft's board of directors

Microsoft's next CEO is already toast. It's a hopeless job. As ex-Microsoftie Charlie Kindel said: "SteveB has faults & made HUGE mistakes. But if you think anyone can do better you simply do not understand just how hard the problem is."

But the preordained failure of the next CEO does not mean Microsoft is forever doomed. The board simply has to understand that they need to look two or three CEOs ahead. Don't bother trying to find a CEO which will save the company in the next five years. That's not gonna happen.

But also don't just hire a five year scapegoat to fill time. The strengths and weaknesses of the next Microsoft CEO do matter. For each candidate, ask yourself two questions:

1. What kind of problems will Microsoft have after 5-10 years with this person as CEO?

2. Is that set of problems the one we want?

The goal here is trading the current set of problems for a more desirable set. Pick the person whose time as CEO will be a "failure" of the right shape. If you do this right, CEO 3.0 will get skewered in the press the day after s/he resigns in frustration. Ten years later, some people will understand that CEO 3.0 left a much better set of problems than Ballmer did, and that's why CEO 4.0 brought Microsoft back to a position of leadership.

Guthrie

Now let's imagine that we took the top 50 candidates and plotted them on some kind of a two-dimensional map, where the the upper right corner of that map represents the kind of problems Microsoft would prefer to have, and the lower left quadrant is the status quo.

If you hire the next CEO from the lower-left quadrant, you get ten more years of Steve Ballmer with a different name.

If you hire the next CEO from the upper-right quadrant, you get something very different. The stock price will go down, because Wall Street only cares about the short term. But in ways that are not highly visible, the company will be on a stronger foundation.

(The other 2 quadrants are undefined results. Both of them yield a new set of problems that may not be better than the status quo. Think of these two quadrants as two different flavors of "change for the sake of change".)

Is Gu really the best choice for CEO? Heck if I know. Probably not. But he's somewhere in that upper right quadrant.