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Hal Berenson is a former distinguished engineer at Microsoft who runs a great blog titled Hal2020. Hal often provides a unique perspective given his experience working at the Redmond software giant during the earlier days of the company from 1994 – 2002 and decades previously spend at the Digital Equipment Corporation. Mr. Bersenson is predicting that Bill Gates will resign from Microsoft as chairman within the year, I find this difficult to believe, but some logical reasoning is provided. He also predicts what I have heard from my sources, Alan Mulally will be brought to the board:
If you want to know why Bill was so emotional at the recent shareholders meeting it was probably because this was likely his last as Microsoft Chairman, not just Steve Ballmer’s last as CEO.
First, this is not about pressure from a couple of investors as was reported a while ago. I believe Bill has come close to giving up the Chairmanship on more than one occasion over the years and now the timing is right.
The timing is right for a new CEO because he can’t have the founder hanging over his head. Bill’s personal connection with employees, even those who joined long after he ceased being CEO, is strong. And his influence amongst investors holding a large percentage of Microsoft stock is also strong. A new CEO can’t have Bill undermining him as he seeks to change the company. Sure Steve had that same problem, and he struggled to establish the right balance between his own direct authority and Bill’s moral authority. A new CEO, particularly an outsider, could not succeed under similar conditions. In fact an outsider will almost certainly insist that Bill phase out of any role at Microsoft before he takes the job. An insider might have a different take if he had a long time connection to Bill. Only Satya Nadella probably fits that situation, and even Satya would be better off without Bill as Chairman.
Bill’s leaving the Chairmanship will probably be orchestrated in some seamless way. Perhaps he will become Chairman Emeritus for a while, followed by his leaving the board but remaining a “Strategic Advisor” before fading into Microsoft history.
Now the obvious question is, who becomes Microsoft Chairman? There actually is an obvious candidate, and this is a scenario I’ve mentioned to a number of people: Alan Mulally! I have never seen Mulally as a good choice for CEO, but he’d be an excellent choice for Chairman.
I think Hal provides some well thought out reasons for why Gates might depart the board, but I do not see it happening. Ballmer still sits on the board of Microsoft and it does not appear to me he has any intention of leaving. I think Ballmer would want Gates to stay on the board as he would be a powerful ally. The new CEO would also have a choice to make, who would he rather have on the board, Gates & Ballmer or activist investors. Gates & Ballmer have the company’s interests at heart, investors have profits. The new CEO knows he will have to deal with Ballmer and Gates going into the job. Even though Gates ‘retired’ in 2008 is has still been heavily involved in the high level strategy from his role on the board. More than anything else now, I think Ballmer & Gates care about the legacy they leave behind at Microsoft and therefore I have a difficult time seeing either of two leaving the board.
Read Hal’s full post on his blog: Hal2020