A decade ago Microsoft was well on its way to irrelevancy. Forbes mag christened Ballmer was the worst CEO in America. The Board fired him, and today his replacement has led Microsoft to pre-eminence in tech, atop the AI heap. His lessons for how to turn around a behemoth are relevant for organizations large and small.
This podcast explains how Nadella immediately de-invested in the “core” Microsoft products of Windows and Office. Instead he poured company resources into SAAS (Software As A Service) and cloud computing. He quit investing in 3% growth markets, and put the money (and people) into 30%/yr growth markets. Instead of letting xBox languish he made the enormous investment to buy Activision/Blizzard, and now the Gaming division is growing at 60% year over year every quarter. And when other companies were reluctant to invest in AI, Nadella led the way. He demonstrated that even an enormous company with a well defined legacy could nimbly change its investments so that the company could return to growth. And you can follow his lead by investing in growth opportunities – and getting yourself neck deep into using AI.
Thinking Points:
- Are you letting history guide your investments of money, people and time? Or are you putting your resources where they can generate growth?
- Are you putting revenue growth first and foremost on your strategy agenda? Or do you fall into discussions about earnings and cash flow?
- Do you know how AI will change your customers world in 5 years, and thus change your world?
- Are you investing in training, tools and processes to implement AI in your business?
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