Microsoft After Gates

We knew it'd happen one day; William H. Gates III--computer-enthusiast extraordinaire, entrepreneur, and richest guy in the world--has decided to back-burner his job and retire in two years so that he can focus on philanthropy. (At 52, he'll be 14 years ahead of another famous self-made man, Andrew Carnegie, who waited until he was 66 to start giving away his money. Ah, Bill--always the prodigy!)

But where will Bill's departure leave Microsoft? Is this the beginning of the end or just the end of the beginning? Can Microsoft survive without Bill, or will the company be just a division of GE, IBM, Google, or HP in a few years?

A few things have always driven Microsoft: its fanaticism for hiring really smart people, which is helpful if you're running a research-driven firm like Microsoft, but not so helpful when it comes to writing documentation; its use of that brainpower to quickly open new areas of development. (I know what you're thinking, but I don't have space to cover the "does Microsoft innovate or merely steal stuff debate" here; let's cover that another day.); and the man who focuses all of that brainpower and points it to those new areas: Bill.

In the last century, German economist and sociologist Max Weber theorized that there were three different types of governmental control: traditional; bureaucratic, or legal; and charismatic. The traditional model refers to leaders who held positions of control through some sort of social inertia (e.g., a dynastic line in which a member of some powerful family receives and holds power because of his or her parents). The bureaucratic model describes organizations in which the organization's process and structure are more important than the person. The US government largely follows the bureaucratic model. In a reference to American President Joe Blow, the words "American President" are more important than the name "Joe Blow." The charismatic model involves a leader who derives his or her power from personal traits such as intelligence, strength, heroism, charm, or whatever. Weber felt that most governments rarely consist of purely one governmental-control type and are instead some mixture of the three. Management theorists have applied Weber's three types to corporations. The traditional model doesn't work well in most businesses--competition tends to squeeze out firms that choose their leaders according to DNA instead of ability.

Which governmental-control type is Microsoft? Heck, that's easy: charismatic. Bill isn't just Redmond's philosopher-king; people's brains involuntarily conjure up Bill's image at the first mention of Microsoft. Once he leaves, Microsoft must follow one of three paths: dwindle away, shift to a bureaucratic structure, or find a new leader.

Let's assume for this discussion that dwindling away won't be an option for Microsoft. One path to survival would be for Microsoft to somehow change from a personality-cult business type to what most large corporations are: big, faceless conglomerates whose main visual associations are slogans, mascots, and symbols. (Offhand, can you name the CEO of General Motors? Of NCR? Exxon-Mobil? I can't.)

That change can surely happen, and we see an example in what may be the obvious case, the Microsoft before Microsoft: General Electric. Like Bill, Thomas Edison wasn't as good at inventing things as most people think. Instead, he was great at finding the vision that made his firm's products not just consumer goods but gotta-have-'em objects. For example, light bulbs didn't exist 150 years ago, but they're necessary items today. Edison single-handedly created the vision in his company, which eventually became GE. GE survived Edison's departure and, with the right stewardship, so can Microsoft. But it won't be easy.

And then there's the last option for survival: find another visionary, another iconic leader who can inspire, impress, and invigorate. There are tons of bright, charismatic, business-savvy techies out there--people without baggage but with stature in the industry. Julius Caesar, a great and charismatic Roman leader, was succeeded by Augustus, someone of arguably greater success and charisma. Perhaps there's someone inside or outside of Microsoft who could become the company's new face.

Personally, I hope Microsoft chooses to search for a new leader. I've had fun watching the PC business' ups and downs since 1973 and Microsoft's progress since 1975. I'd hate for the company to become "General Software," and I can't help feeling that following the bureaucratic path would lead the company in that direction.

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