Coming Soon: The Great CEO Transition At Microsoft (And The 7 Steps That Will Help Them Get It Right)

On the one hand, it’s not a surprise that Steve Ballmer’s time as CEO is coming to an end. He bowed out earlier than expected, but he’s giving the board a year or so to find his replacement.

On the other hand, the “short list” of possible CEOs is relatively long. Internally, there’s COO Kevin Turner, Tami Reller from marketing, Tony Bates from business development and finally Satya Nadella from Microsoft ’s engineering department. Other possibilities include former Microsoft employees like Stephen Elop from Nokia (who’s about to become a current employee again), Steven Sinofsky and Kevin Johnson. In particular, The Wall Street Journal’s John Stoll makes a good case for why we should take Stephen Elop seriously.

The only thing that’s clear at this time though is that the race is on. This is where organizations like Microsoft benefit from having put long-term future capability planning in place. But let’s back up and clarify the difference between talent development, succession planning and future capability planning.

 

Talent Development

Talent development starts with the people you’ve got. Figure out their strengths and pinpoint opportunities for growth. Then, map out plans for them to acquire the knowledge and skills they need to maximize their potential. This will involve training and planned assignments to help them develop certain required skills.

If Elop ends up as CEO, someone will claim they urged him to go to Nokia as a developmental assignment. This will end up as a great (though fictional) example of such an assignment working well.

Succession Planning

Succession planning starts with positions to be filled. This is what’s going on at Microsoft. The question to be asked is who could replace the current people in key positions.

 

Future Capability Planning

Future capability planning takes a longer view, looking out at future talent needs dictated by the long-term strategic plan. Work through seven steps.

  1. Lay out the strategic priorities
  2. Determine future capabilities required to fulfill those priorities
  3. Assess existing capabilities
  4. Agree on the most important gaps between future and existing capabilities
  5. Identify current people with the talent to fill those gaps and plans to develop their knowledge and skills.
  6. Identify positions to fill early on and plans to develop those people further for other positions.
  7. Identify positions to fill later with people joining just in time and already fully developed.

Microsoft has certainly been doing step five, training people to build knowledge and moving people through different assignments to acquire skills. But what about the other six steps?

If Kevin Turner ends up as CEO, it will be an example of step six, bringing people in relatively early and developing them. I met Turner in July 2009. The story of how he was recruited into Microsoft is a good one. The key moment happened after Steve Ballmer had been trying to recruit him for 18 months over a series of conversations, dinners and the like. Finally, Bill Gates met with him and said “I hope you’ll come change the world with us.” That hooked him.

But back to the fan favorite, if Stephen Elop ends up as CEO, it will in truth be an example of step seven, bringing people in later on. Of course, Microsoft’s board may still go completely outside and bring someone directly into the CEO role. If they do that, the organization’s executive onboarding expertise (or lack thereof) will come into play.

 

Lessons For You

You’re not Microsoft. You probably can’t invite people to come change the world with you with any credibility. But you must get ahead of the curve on future capability planning, figuring out what capabilities you’re going to need for the future and the steps you’re going to take to acquire and/or develop them.

Click here for an overall summary of and links to my articles on Forbes, The New Leader’s 100-Day Action Plan book, and the 100-Day Plan for Interviews tool.

Read More Articles

Primegenesis blog leadership executive onboarding
The Counterintuitive Advantage of Panicking Early

Panicking is bad. But panicking early is good because that means you won’t panic later. And therein lies the counterintuitive advantage of panicking early – those who panic early never…

Read Article
Why You Should Have More, Not Fewer Meetings | Meeting Effectiveness for Leaders

Meeting effectiveness is not about having fewer meetings. It is about having the right meetings, with the right people, for the right reasons, done in the right way. When leaders…

Read Article
The Artistry in Communication: Where Leadership Comes Alive

Executive communication is often taught as a process of alignment — aligning messages with culture, strategy, operations, and tactical missions. That’s necessary but not sufficient. The artistry lies not in…

Read Article
How Mission Briefs Accelerate Progress by Clarifying Direction, Resources, Authority, and Follow-Through
How Mission Briefs Accelerate Progress by Clarifying Direction, Resources, Authority, and Follow-Through

Teams fail when direction is fuzzy, resources are ambiguous, or authority is blurred. Too often, leaders assign tasks without enough context for teams to make smart, independent decisions. The result?…

Read Article
Bring Yourself to Work

There are few career inflection points more challenging, or requiring more thoughtful planning, than assuming a position of leadership. We unconsciously acquire bits of our leadership persona over the course…

Read Article
Leadership Transition Lessons from the NFL

Leadership transitions are rarely about failure. They’re about timing. They’re about trajectory. And they’re about whether an organization believes its next chapter requires a different kind of leadership than the…

Read Article