Ballmer tightens grip on Microsoft with major revamp

Thu Jul 11, 2013 7:10pm EDT
 
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By Alexei Oreskovic

SAN FRANCISCO (Reuters) - Microsoft Corp's sweeping re-organization on Thursday creates a company that, more than ever, bears the stamp of Chief Executive Steve Ballmer.

The face of Microsoft since he took the reins from co-founder Bill Gates in 2000, Ballmer stressed the importance of improving internal collaboration and eliminating redundancies when he released the company's new organizational blueprint.

But some analysts say the changes also mean less leeway for Microsoft's individual businesses to set and pursue their own agendas, as the company imposes a more streamlined, top-down approach to its strategy and operations.

For all the changes promised, the move reinforces Ballmer's grip on the company's direction and further muddies the succession picture.

"There's still no heir apparent or any succession strategy that has become apparent," said David Smith, an analyst with industry research firm Gartner. "It sounds like he wants to run it in a more centralized style."

That Ballmer, 57, who presided over a decade of share price stagnation and was deemed slow to respond to mobile computing, remains more entrenched may worry investors and spur concern that the reorganization will truly effect change.

"In theory, it's a great idea. The key question will be can Ballmer deliver this in new model and can it be successful," said Channing Smith, co-manager of the Capital Advisors Growth Fund, which does not own Microsoft shares.

"With his track record, it will be question mark for investors going forward."   Continued...

 
Microsoft CEO Steve Ballmer speaks during his keynote address at the Microsoft "Build" conference in San Francisco, California June 26, 2013. REUTERS/Robert Galbraith