5 ms·

Most of the board members seem to be partners at various investment firms. Many of them don't seem to even remotely tech people. It's kind of sad that the Micro

Most of the board members seem to be partners at various investment firms. Many of them don't seem to even remotely tech people. It's kind of sad that the Microsoft board lacks any external visionaries.

lacker 7y ago
At a huge company like Microsoft the board isn't really a great place for visionaries. It's much better at things like helping the CEO understand the thoughts of large institutional investors that provide Microsoft with capital. A visionary is better suited as a "special advisor" to someone... like the role that Bill Gates is keeping.
- basch 7y ago
  At the same time, if the function of the board is to keep the ship from drifting too far off course, or to handle certain problems the company itself seems incapable of or oblivious to (mass cognitive dissonance) it could be useful to have a Jobsesque pitchman who can get a board to be accepting of radical risk taking. A board might lean conservative and risk averse, and sometimes companies need moments of extreme risk. Usually that jump takes a persuader. Being able to sit in on board meetings, and talk during them would be enough, not necessarily having a vote, maybe thats a special adviser?
  - wayoutthere 7y ago
    > Being able to sit in on board meetings, and talk during them would be enough, not necessarily having a vote, maybe thats a special adviser? Big multinationals typically have advisory boards / subcommittees that advise them on certain topics. I assume Microsoft has a technology advisory board (and in their case, likely several) that includes at least some high-level engineering talent. Leadership at the board level involves high level decision-making, but not a lot of actual work. The CFO of PepsiCo has a ton of responsibilities himself; his position on the board of Microsoft is likely only a few hours a month because it's limited to reading reports prepped by the C-suite and its advisors, then voting on decisions. Senior executives and investors are chosen for boards because their day jobs require an understanding of market context and a good bullshit filter to guard against the Jobsesque pitchman scenario.
    - basch 7y ago
      Big strategy shifts, or attempts, like buying Nokia, would go through the board of most companies. If the entire board is conservative investors without vision for pivot and reinvention, your company will slowly stagnate. Ideally you can identify and make those moves before youve become surpassed. IBM purging its hardware divisions, and then buying Red Hat is another example, where a company maybe waited a little too long between moves. Would a more aggressive board pushed the company to do that earlier?
- njarboe 7y ago
  With cash on hand of around $140 billion, I'm not sure Microsoft really needs to worry about outside capital. I would think the board could help with how to keep those big companies paying for everyone to have the full Microsoft Office suite and how to custom price it.
  - maest 7y ago
    They still care about share price, which depends on outside investors willing to buy the shares, which depends on MS having good IR, which some of the board members help with.
- sytelus 7y ago
  This is not true. Look at Google board. Very few investor suits but many tech visionaries.
bdamm 7y ago
It actually makes a lot of sense. Technical people sometimes think that the higher up you go the bigger the decisions, but normally decision making peters off around the Director level. Above that and it's really about how to keep the company going as a company, or in other words the business of maintaining a structure of people that continues to survive within the regulatory context that the company operates within. And for a large multinational company like Microsoft, that's an enormously big deal. You're generally lucky if the CEO has any technical capabilities at all.
- MichaelMoser123 7y ago
  That's a interesting perspective. Can you give examples of regulatory decisions that make a difference to the bottom line on that sort of scale?
  - hoorayimhelping 7y ago
    https://en.wikipedia.org/wiki/United_States_v._Microsoft_Corp https://en.wikipedia.org/wiki/United_States_v._Microsoft_Cor... is kind of the classic example of expensive regulatory decisions
    - MichaelMoser123 7y ago
      how could they have influenced that one in practical terms?
      - ta999999171 7y ago
        Not doing illegal shit and spitting in the faces of technically intelligent potential complainants. They're playing nice now so Windows 10 spyware gets accepted.
        MichaelMoser123 7y ago
        i don't think that was a wise decision: as a result of the spyware scourge the concept of native apps in windows is dead and you need a web based app for about anything.
mbesto 7y ago
Board members focus on things like governance and fiduciary responsibilities, not on what the next version of Windows is going to be. You'll find that most VCs are also not "even remotely tech people". Guess what - they also happen to sit on many tech startup boards.
- sytelus 7y ago
  No. Governance squarely lies with CEO and fiduciary responsibility with CFO. Board is supposed to look at these but they are not responsible for it (i.e. Enron board members don't go to jail for fraud but CEO and CFO may). The board does not exist just for administrative purposes. At all time, senior leadership need to behave so that they have confidence of board members. In return, board members are supposed to advice on investments company is making or not making, competative landscape, internal struggles, big problems, earnings expectations etc.
freepor 7y ago
Board members aren't there to invent the next iPhone, they're there to determine when the CEO should be fired, and to hire a new CEO when necessary. Right now, the Microsoft board is particularly pointless since Satya Nadella is one of the highest-performing CEOs in the world and isn't close to retirement.
- dpe82 7y ago
  The board is meant to represent the investors and act as a check on the power of top executives so they don't go rogue and act contrary to the investors interests. Their job is certainly easier when the CEO is strong and things are going well, but it's still an important role. Often the CFO (and sometimes other C-level officers) will also report directly to the board, or at least have a direct line of communication that the CEO isn't allowed to interfere with.
- wcski 7y ago
  If Satya got hit by a bus this weekend that "pointless" board would become very important very quickly.
  - alasdair_ 7y ago
    Don’t be crazy! All the bus drivers are at home with covid-19 symptoms....
- sytelus 7y ago
  That's not how it works. When CEO wants to take on big bet, he will typically need board approval. You can imagine Steve Jobs standing in board room and presenting costs and promise of iPhone. If your board is all classic investor suits then they might not see through things. They can move to prevent CEO from spending big money because that would reflect in reduced earnings because of higher capex. I think this is one reason Google gets away with far larger R&D capex than Microsoft because their board has real tech folks and ex-founders.
virtuabhi 7y ago
Padmasree Warrior was CTO at Motorola, and then at Cisco.
sytelus 7y ago
I think this is related to the fact that Microsoft announced a deal few years back that any entity with more than 4% stock ownership automatically gets right to have a seat on the board. During those times, stock was struggling and this might have been strategy to pull some investors who wants to have control as well. In my personal opinion, this was quite unfortunate because such strategies usually invites "activist" investors types. These types are rarely good for long term future of the company as they often enforce short term strategy such as massive buy backs, dividents etc to prop up the stock while actively prevent large capex needed to go after long term big bets.

lacker 7y ago

At a huge company like Microsoft the board isn't really a great place for visionaries. It's much better at things like helping the CEO understand the thoughts of large institutional investors that provide Microsoft with capital. A visionary is better suited as a "special advisor" to someone... like the role that Bill Gates is keeping.

basch 7y ago
At the same time, if the function of the board is to keep the ship from drifting too far off course, or to handle certain problems the company itself seems incapable of or oblivious to (mass cognitive dissonance) it could be useful to have a Jobsesque pitchman who can get a board to be accepting of radical risk taking. A board might lean conservative and risk averse, and sometimes companies need moments of extreme risk. Usually that jump takes a persuader. Being able to sit in on board meetings, and talk during them would be enough, not necessarily having a vote, maybe thats a special adviser?
- wayoutthere 7y ago
  > Being able to sit in on board meetings, and talk during them would be enough, not necessarily having a vote, maybe thats a special adviser? Big multinationals typically have advisory boards / subcommittees that advise them on certain topics. I assume Microsoft has a technology advisory board (and in their case, likely several) that includes at least some high-level engineering talent. Leadership at the board level involves high level decision-making, but not a lot of actual work. The CFO of PepsiCo has a ton of responsibilities himself; his position on the board of Microsoft is likely only a few hours a month because it's limited to reading reports prepped by the C-suite and its advisors, then voting on decisions. Senior executives and investors are chosen for boards because their day jobs require an understanding of market context and a good bullshit filter to guard against the Jobsesque pitchman scenario.
  - basch 7y ago
    Big strategy shifts, or attempts, like buying Nokia, would go through the board of most companies. If the entire board is conservative investors without vision for pivot and reinvention, your company will slowly stagnate. Ideally you can identify and make those moves before youve become surpassed. IBM purging its hardware divisions, and then buying Red Hat is another example, where a company maybe waited a little too long between moves. Would a more aggressive board pushed the company to do that earlier?
njarboe 7y ago
With cash on hand of around $140 billion, I'm not sure Microsoft really needs to worry about outside capital. I would think the board could help with how to keep those big companies paying for everyone to have the full Microsoft Office suite and how to custom price it.
- maest 7y ago
  They still care about share price, which depends on outside investors willing to buy the shares, which depends on MS having good IR, which some of the board members help with.
sytelus 7y ago
This is not true. Look at Google board. Very few investor suits but many tech visionaries.

bdamm 7y ago

It actually makes a lot of sense. Technical people sometimes think that the higher up you go the bigger the decisions, but normally decision making peters off around the Director level. Above that and it's really about how to keep the company going as a company, or in other words the business of maintaining a structure of people that continues to survive within the regulatory context that the company operates within. And for a large multinational company like Microsoft, that's an enormously big deal. You're generally lucky if the CEO has any technical capabilities at all.

MichaelMoser123 7y ago
That's a interesting perspective. Can you give examples of regulatory decisions that make a difference to the bottom line on that sort of scale?
- hoorayimhelping 7y ago
  https://en.wikipedia.org/wiki/United_States_v._Microsoft_Corp https://en.wikipedia.org/wiki/United_States_v._Microsoft_Cor... is kind of the classic example of expensive regulatory decisions
  - MichaelMoser123 7y ago
    how could they have influenced that one in practical terms?
    - ta999999171 7y ago
      Not doing illegal shit and spitting in the faces of technically intelligent potential complainants. They're playing nice now so Windows 10 spyware gets accepted.
      - MichaelMoser123 7y ago
        i don't think that was a wise decision: as a result of the spyware scourge the concept of native apps in windows is dead and you need a web based app for about anything.

mbesto 7y ago

Board members focus on things like governance and fiduciary responsibilities, not on what the next version of Windows is going to be. You'll find that most VCs are also not "even remotely tech people". Guess what - they also happen to sit on many tech startup boards.

sytelus 7y ago
No. Governance squarely lies with CEO and fiduciary responsibility with CFO. Board is supposed to look at these but they are not responsible for it (i.e. Enron board members don't go to jail for fraud but CEO and CFO may). The board does not exist just for administrative purposes. At all time, senior leadership need to behave so that they have confidence of board members. In return, board members are supposed to advice on investments company is making or not making, competative landscape, internal struggles, big problems, earnings expectations etc.

freepor 7y ago

Board members aren't there to invent the next iPhone, they're there to determine when the CEO should be fired, and to hire a new CEO when necessary. Right now, the Microsoft board is particularly pointless since Satya Nadella is one of the highest-performing CEOs in the world and isn't close to retirement.

dpe82 7y ago
The board is meant to represent the investors and act as a check on the power of top executives so they don't go rogue and act contrary to the investors interests. Their job is certainly easier when the CEO is strong and things are going well, but it's still an important role. Often the CFO (and sometimes other C-level officers) will also report directly to the board, or at least have a direct line of communication that the CEO isn't allowed to interfere with.
wcski 7y ago
If Satya got hit by a bus this weekend that "pointless" board would become very important very quickly.
- alasdair_ 7y ago
  Don’t be crazy! All the bus drivers are at home with covid-19 symptoms....
sytelus 7y ago
That's not how it works. When CEO wants to take on big bet, he will typically need board approval. You can imagine Steve Jobs standing in board room and presenting costs and promise of iPhone. If your board is all classic investor suits then they might not see through things. They can move to prevent CEO from spending big money because that would reflect in reduced earnings because of higher capex. I think this is one reason Google gets away with far larger R&D capex than Microsoft because their board has real tech folks and ex-founders.

virtuabhi 7y ago

Padmasree Warrior was CTO at Motorola, and then at Cisco.

sytelus 7y ago

I think this is related to the fact that Microsoft announced a deal few years back that any entity with more than 4% stock ownership automatically gets right to have a seat on the board. During those times, stock was struggling and this might have been strategy to pull some investors who wants to have control as well. In my personal opinion, this was quite unfortunate because such strategies usually invites "activist" investors types. These types are rarely good for long term future of the company as they often enforce short term strategy such as massive buy backs, dividents etc to prop up the stock while actively prevent large capex needed to go after long term big bets.