Microsoft's Executive Revolving Door Keeps Spinning

Last month I wrote about the impending departure of Bob Muglia as president of Microsoft's Server and Tools Business. When Bob leaves this summer, he'll be going out at the top of a very difficult game: STB covers both the Microsoft Server crown jewels and the Azure cloud future, as well as SQL Server and Visual Studio. And it's making a ton of money -- more than $15 billion a year.

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Yesterday Steve Ballmer announced he was replacing Bob Muglia with Satya Nadella. In the same email he announced the (highly unexpected) departure of Amitabh Srivastava. That move strikes me as bizarre in a multitude of ways.

Although Nadella obviously has talent beyond the search engine, he is known as "Mr. Bing" to many in and around Redmond in his capacity as senior vice president in charge of engineering for the Online Services Division, where Bing is the stellar performer. Ballmer's assessment: "In his role in the Online Services Division, [Nadella] led the overall R&D efforts for some of the largest online services and drove the technical vision and strategy for several important milestones, including the critical launch of Bing, new releases of MSN, Yahoo integration across Bing and adCenter, and much more."

Like I said, Mr. Bing.

Two years ago Ballmer passed over Nadella (who has an M.S. in Computer Science and an MBA) and named Qi Lu president of the Online Services Division. Two years later Nadella is tapped to lead a much, much larger and more profitable division.

Now consider the pedigree of the departing Srivastava, who is currently senior vice president of Server and Cloud, which is Bob Muglia's (and STB's) largest and most important component. For the past two years Srivastava has been in charge of both Windows Server and Azure.

More than that, though, Srivastava came to lead the Server and Azure effort when Ballmer combined the Windows Server and Azure organizations two years ago. Srivastava's roots are in Azure -- the future of STB. He's a Microsoft Distinguished Engineer, with a legend that dates back to the days of Brian Valentine and Jim Allchin and the rescue of Longhorn. He worked with Ray Ozzie on Project Red Dog, which became Azure. He's been living in the cloud since 2006. He's been leading Bob Muglia's #1 division for the past two years.

And he lost out to Mr. Bing.

Bloomberg Businessweek, quoting unnamed sources, claims that Ballmer is in the process of a management shake-up "aimed at adding senior product executives with an engineering background." That may be the intent, but the execution speaks differently.

In the ongoing battle between the geeks and the suits -- er, the executives with a technical background (typified by Mr. Gates) and those with a business/management background (Mr. Ballmer's gene pool) -- it seems to me two very senior techies are on their way out, replaced by a guy with stellar Yahoo integration skills.

I just don't get it.