Ford CEO Alan Mulally - Can He Really be the Front Runner to Replace Steve Ballmer as Microsoft CEO?


According to Kara Swisher of All Things D (as yet still a part of the Wall Street Journal), Ford's CEO Alan Mulally "has vaulted to the forefront of the candidates to become the new CEO of Microsoft." Further, it appears that the reason for this is that Microsoft independent board member John Thompson, who is heading up Microsoft's CEO search, has become enamored with Mulally.

Adding further fuel to the speculation is that Ballmer sought out Mulally's advice when he was plotting Microsoft's reorganization – strongly, very strongly – suggesting that Ballmer himself is fully on board with the idea. Perhaps this is what Ballmer meant when he said that he had been in discussions over the last three years or so with people he considered true candidates to take over Microsoft at some point in time.

It's a very interesting possibility to consider. Mulally is in our own opinion a star-level CEO. We greatly appreciate and admire what he has done at Ford. This includes not taking a government handout, which kept Ford's bondholders happy (and bondholders should always be kept happy) and has kept Ford out of the hands of the UAW - we all know who now owns or ended up owning so much of GM and Chrysler stock do we not, and why? Hint: the GM and Chrysler bondholders were truly screwed.

There is a great deal to be said of a very positive nature for a CEO that has managed to prove that Ford could weather the storm without a financial bailout or the resulting coercion to build expensive electric-only cars on the federal government's terms rather than its own, could move forward with new ideas for organizing its current collection of automobiles, and for essentially keeping the company intact and moving forward. Sure, by no means is Ford out of the woods yet, but it stands on its own two feet. For the tech industry this is critical and entirely crucial for ongoing success.

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It is also true that as the former CEO of Boeing Mulally successfully shepherded through the Boeing 777 from concept to real and quite successful product. He has real engineering chops and no doubt he is easily able to transition back and forth between technology and business issues – something that Bill Gates would no doubt appreciate. Our guess is that Mulally is also entirely sophisticated in the ways of today's mobile world and social networking realities – both of which are critical to taking on the CEO role at Microsoft. We get a definite sense of Mulally being a "young older guy" fully living a 21st century mobile lifestyle.

If the rumors quickly become more than rumors, the next inevitable thing that will no doubt pop up will be comparisons to when IBM hired Lou Gerstner away from Nabisco. Now there is absolutely no denying that Gerstner's hire proved to be a genius move for IBM. And we totally concur with that view. Back then we spent a number of years closely covering IBM and the internal senior management level perspectives around Gerstner's management style and strategies, we can note firsthand, became hugely well-received over time.

Unlike Mulally, Gerstner brought a fine knowledge of Oreo cookies to the IBM game but absolutely no technical chops – that proved entirely irrelevant. For a Microsoft CEO gig we believe the technical chops are much more relevant simply because of the techie head-banging culture of Microsoft (that did not exist at IBM back in the 1990s – in fact we can't say that it exists today).

The Necessary Transition

Our question is, can Mulally transition from a suit-wearing CEO to a polo-shirt and casual slacks wearing CEO? In Ballmer's never-ending quest to protect Microsoft's old enterprise assets he made the opposite transition - to becoming a standard bearer for the suit-wearing, white shirt and red tie public uniform crowd. We're serious here - but we mean to underscore the following: can Mulally fully embrace not only today's world of mobile lifestyle but one that will also move to becoming a wearable technology oriented world with a powerful sense of empathy for this new tech world?

Ballmer had no empathy for where tech's future is headed – it is a key reason he failed so spectacularly to transition Microsoft into a true mobile player. You cannot fake the empathy – either you have it or you don't. This empathy is critical for Microsoft to succeed. Why?

If Mulally gets the nod – in fact this will be true of whoever gets the nod – he must focus all of his attention on moving Microsoft forward and looking ahead to not only what a 2020 Microsoft must look like but also having the vision and strategies to get Microsoft there. It's all about the empathy for tomorrow's world rather than yesterday's. That said, Microsoft can hardly forget about its old world – that is still where all the money is today.

But while Mulally or whoever gets the nod must keep that in mind, he must also necessarily understand that those old businesses need to be turned over to lieutenants, and while of course they will need to be watched, it's only 20 percent of what the new CEO needs to focus on. The less empathy for old school Microsoft the new CEO will have, the better the chances that Microsoft will successfully move into the future. Ballmer was a lost cause on this front - but it is what made him a star CEO as far as protecting those old assets.

We will note here, speaking of Ballmer, that he recently had a last farewell gathering with the entire collection of Microsoft troops – who hooted and hollered that they loved him while Ballmer reprised some of his own old hooting, hollering and jumping around. We're glad that took place. Perhaps it will serve as closure (if you believe that we've got a bridge in Brooklyn we'd like to sell you).

We look forward to hearing much more on the Mulally front. We would be quite comfortable with Mulally getting the nod because we believe he has the capacity to make the needed transitions noted above and will in fact bring the hugely needed empathy for the right version of the 2020 Microsoft to the game.

Edited by Alisen Downey

TechZone360 Senior Editor

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