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Summary:

The longer the CEO transition takes, the more unfocused and unproductive Microsoft gets, according to insiders. Look for Microsoft to make its move just after the Q1 earnings call.

Mystery man suit question mark

The slower the slow-mo transition from Microsoft CEO Steve Ballmer to whoever’s next, the worse it will be for the company. But insiders don’t expect the pick to named until right after the company’s earnings call Oct. 24 and before Thanksgiving. (Who wants to bet on a late press release on Thanksgiving Eve?)

That’s quick but not quick enough for some who say distraction around succession plans is hindering productivity. “Everyone says they’ve bought into Ballmer’s reorg but in fact no one knows who will be in charge so they can’t really buy in all that much,” said one current employee.

Now, news that shareholder discontent  – which had focused on Ballmer and the board — has spilled over to Microsoft co-founder and chairman Bill Gates himself makes it more important to name who will lead the software giant day to day.

Wait for the earnings call then all bets are off

The best guess now is that the status will remain quo until the call, during which whatever bad news there is for the company’s first FY 2014 quarter — and there almost certainly will be bad news — will get hung on Ballmer. Then within days, Ford’s Alan Mulally or whoever will be named CEO. Presto! A fresh start or as former Red Sox outfielder Manny Ramirez used to say, “turn the page.” All is well with the world.

(FWIW, the betting on whether Mulally is the right guy to lead Microsoft is all over the map. Forbes says no way, AllThingsDigital says the opposite. Mulally denied the talk of him leaving Ford earlier today — sort of.)

A new CEO means other changes

Whoever the CEO pick is, until it’s final, the Microsoft rank and file can’t focus. Any CEO worth his or her salt will want to bring in some new faces and perhaps lop some heads. A wiseguy might say that since no one’s sure how the org chart will look, it’s impossible to tell who to suck up to and who to backstab, or “face stab,” as one former Microsoft wag put it.

Microsoft has traditionally been laced with political and personal fiefdoms, often very much at odds with each other. That helps explain why the company is in the state it’s in and why it needed a reorg — which rolled out in July. But it didn’t necessarily need that particular reorg, which was seen as centralizing more power under Ballmer. Within two months of that news, Ballmer announced his plan to step down, and whoever takes his place might not want to implement that plan in the same way.

In other words, wait for the earnings call and prepare for news.

  1. What!! Bill gates is not the ceo?

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    1. not for a decade or more no. But still chairman.

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