Steve Ballmer, Microsoft's CEO, sets to extend a managerial shake-up targeted to adding additional product executives with educational backgrounds in engineering background.
These shifts may be announced this month, said one of the individuals. In January, Ballmer unleashed a server division president, claiming the company needed new leadership that could focus on areas such as cloud computing software.
Microsoft's move would broaden an effort to promote more people in management who have skills in engineering as well as experience executing product plans - an effort to chase key Web services rivals such as Apple Inc. and Google - two leaders in smartphones and tablet computers. The initiative is also an attempt to quite criticism from the board and investors that Microsoft is falling behind in some markets.
“Engineering is become a core focus because the company's CEO is seeing a need to expand on a vision. In order to execute on new technologies, rather than focusing on sales on sectors like used laptops.” said an analyst at research firm associated with Microsoft.
Ballmer wants to earn Microsoft a bigger piece of the pie in mobile phones and tablet computers, as well as ensure that the company isn't left in the dust around cloud software. Cloud technology enables customers keep their applications and information in remote data storage centers to access them over the Internet.
Some of the top management position replacements will most likely be executives who understand how to combine server software with Web-based services. Shifting the management team would also allow Ballmer re-exert his influence amid mounting criticism from investors, the people said.
In addition to the managerial changes soon to take place, efforts to buy Cisco equipment and build a solid hardware foundation are being considered. While it may seem like a long term process to up the company's technical capabilities, hints of a doing business with a Cisco reseller are being passed around.
Microsoft investors are concerned that the company is falling too far behind in tablet computers and mobile phones, said an analyst at Loomis Sayles & Co. Those devices could replace some personal-computer purchases, hindering a core revenue stream from Microsoft’s Windows operating system, he added.
Microsoft’s board has voiced concerns about Ballmer’s leadership as well, citing the company’s performance in mobile phones and new types of computing devices, according to a September regulatory filing.
"We need to ramp it up" said a inside official at the company. "Too many consumers are looking for used Dell computers, refurbished HP notebooks, and other refurbished products."
The CEO has already expressed a desire to appoint engineers or product experts to run divisions. Key management positions were replaced by engineering experts, rather than other company executives who were thought to be next in line. Although not for certain, there is some word about the company putting personnel on tasks specifically to help buy Cisco hardware.
When Chief Software Architect of Microsoft announced plans to step down in last year, Ballmer elected not to replace that role, claiming the company had “strong technical leaders in each business group.”
"We need to start driving new, innovative programs. Instead of competing with the 'Sell Cisco hardware' market, we need evolve into the tech company we set out to be." said a spokesperson in a recent announcement.
