This thoughtful article by Ben Thompson (who has spent time working at Apple, Microsoft and more recently at Automattic) was originally posted before Ballmer announced his forced retirement. A hypothetical that is next to an impossibility to happen, but perfectly highlights the endemic culture present at Microsoft. This is highly unlikely to change with a new CEO or a shift to a functional structure, and the turmoil certainly doesn’t help.
“Ballmer is a master at pushing a successful product to a dominant position and extracting the profits that follow. He demonstrated this not just in his time as CEO, but in his previous role as the head of sales and marketing. Microsoft’s truly remarkable run of ever-rising revenue and profits is the direct responsibility of Ballmer. But, this run of ever-rising revenue and profits, and the means by which it was generated, were also the same reason opportunities have been missed … And so, dollars and cents were a central focus for Ballmer, and for Microsoft. Employees were incentivized by dollars and cents in the form of bonuses and stock grants. Bonuses and stock grants were tied to a stack ranking system, that devolved your performance to a number. What was measurable mattered, particularly if it was measured in money. The result is inevitable: Microsoft is a company filled with people motivated by measurables like salary, bonus, and job level. Anyone who isn’t would necessarily leave.2 Unsurprisingly, said people make choices based on measurables, whether those be consumer preferences, focus group answers, or telemetrics. The human mind is flexible, but only to a point.”