Bloomberg News

Microsoft Board Said to Refine CEO List at Meeting

November 16, 2013

Microsoft CEO Steve Ballmer

Directors are aiming to have a choice as soon as next month to replace CEO Steve Ballmer, who is retiring, said people familiar with the search, who asked not to be identified because the discussions are confidential. Photographer: Krisztian Bocsi/Bloomberg

Microsoft Corp. (MSFT:US)’s board will meet on Nov. 18 to trim a list of chief executive officer candidates, with the goal of whittling the roster to three to five people, said a person with knowledge of the process.

Directors are aiming to have a choice as soon as next month to replace CEO Steve Ballmer, who is retiring, said people familiar with the search, who asked not to be identified because the discussions are confidential. After narrowing the list at the meeting, directors plan to interview final candidates over the next several weeks, said one of the people.

Microsoft is working to speedily wrap up its CEO search after Ballmer said in August that he would exit within a year. The Redmond, Washington-based company is transitioning from its roots as the world’s largest software maker to focus on devices and services, as rivals Apple Inc. (AAPL:US) and Google Inc. (GOOG:US) have shifted the technology landscape away from Microsoft’s bread-and-butter personal-computer business to mobile computing.

“Microsoft directors are probably focused more on candidates’ strategic vision and capacity to lead a complex global company and less on industry specific experience,” said Joseph McCool, president of search committee advisory firm McCool Group in Amherst, N.H. “A critical filter is whether a candidate can immediately inspire confidence among both shareholders and employees.”

Mulally, Elop

A document prepared by the board for the CEO search describes the ideal candidate as one who has an “extensive track record in managing complex, global organizations within a fast-paced and highly competitive market sector; track record of delivering top and bottom line results. Proven ability to lead a multi-billion dollar organization and large employee base,” according to people with knowledge of the document.

External choices for the CEO job include Ford Motor Co. CEO Alan Mulally and former Nokia Oyj CEO Stephen Elop, among others, people with knowledge of the search have said. Because the board perceives the new CEO will have to lead change at Microsoft, the final choice is more likely to be an outsider, said one person with knowledge of the search.

While the search committee considers Mulally a strong candidate, it hasn’t settled on a frontrunner, said the person. Directors are weighing Mulally’s lack of computer-technology background against a desire for the new CEO to have solid management credentials at the helm of a large company, the person said.

Internal Choices

The board is also considering three internal candidates: business development and evangelism chief Tony Bates and Satya Nadella, who oversees the company’s cloud and enterprise business, as well as Chief Operating Officer Kevin Turner, people have said.

Tony Imperati, a spokesman for Microsoft, declined to comment or to make company executives available. Susan Sheehan, a spokeswoman for Nokia, declined to comment.

“Nothing has changed from what we announced last November,” Jay Cooney, a spokesman for Ford, said by telephone. “Alan remains focused on executing the One Ford plan, and we don’t engage in speculation.”

Microsoft will hold its annual shareholder meeting, Ballmer’s final one as CEO, on Nov. 19 in Bellevue, Washington. Directors will be in the area to attend the event and the company often schedules a board meeting around that time.

To contact the reporters on this story: Dina Bass in Seattle at dbass2@bloomberg.net; Peter Burrows in San Francisco at pburrows@bloomberg.net; Carol Hymowitz in New York at chymowitz1@bloomberg.net

To contact the editor responsible for this story: Pui-Wing Tam at ptam13@bloomberg.net


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