Stephen Elop and Steve Ballmer

Stephen Elop and Steve Ballmer

Report: Microsoft CEO Search Narrowed

And then there were five

A credible report from Reuters claims that Microsoft has narrowed the number of possible candidates for its next CEO to five individuals. Of those, two are external to the company and at least two are among its highest-ranking executives.

Related: "Assessing the Ballmer Years"

So who's on the short list? According to Reuters, it was able to identify only four of the five remaining candidates, although the fifth is said to be a current Microsoft executive. The identified candidates are:

Ford CEO Alan Mulally. Mr. Mulally was my original choice, and it was interesting to see his name pop up quickly and then rapidly rise to the top of potential candidates in the wake of Steve Ballmer's announcement that he would step down as CEO. A former Boeing executive, Mulally is widely credited for turning around Ford, so he already has experience moving into new businesses. But Mulally is getting old: At 68, he's over 10 years old than the man he'd replace. And Mulally has publicly expressed his desire to stick with Ford for one more year and then retire.

Stephen Elop. Currently in a strange limbo while regulatory agencies review the sale of his current employer, Nokia, to Microsoft, Mr. Elop was the CEO of Nokia for three years and will otherwise lead Microsoft's Devices team if he doesn't become CEO. Elop is a former Microsoft executive, which gives him credibility within the company, but his tenure at Nokia didn't exactly lead to a clear-cut turnaround, and it's possible that he would simply do the bidding of the Microsoft board of directors. Which, to be frank, many feel he did while running Nokia, too.

Related: "In Blockbuster Deal, Microsoft to Buy Nokia"

Tony Bates. The former CEO of Skype now oversees Microsoft's business development and could be the right combination of outsider and insider as the Skype organization has, thus far at least, traveled to the beat of its own drum while ostensibly part of Microsoft. And he certainly has the "devices and services" chops to understand the current direction the firm must take.

Related: "Microsoft + Skype: It's Official"

Satya Nadella. The brilliant and well-spoken leader of Microsoft's cloud and enterprise business probably knows more about cloud computing than anyone at the company. He would be the top internal choice, in my opinion, more engineer than businessman.

The Reuters report notes that Microsoft started with a much lengthier list of 40 names, and sources close to the software giant have told me that it would like to finalize the search before the end of 2013.

Whoever Microsoft picks, there are many questions remaining. Key among them is whether the new CEO will really be able to guide the right strategy for the firm or whether he or she will need to kowtow to Bill Gates and current CEO Steve Ballmer, both of whom are likely to remain on Microsoft's board of directors. Microsoft is in the midst of a major strategy overhaul, as it moves from a traditional provider of software to what it calls a devices and services company.

Related: "Could Microsoft's Next CEO Be Emerging?"

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