Windows boss Terry Myerson has quickly become the most powerful guy at Microsoft under Satya Nadella
All of Nadella's top lieutenants have risen in power:
- Windows boss Terry Myerson
- Cloud boss Scott Guthrie
- Applications boss Qi Lu.
And four high-ranking executives, holdouts from former CEO Steve Ballmer's administration, are out:
- Former Nokia CEO Stephen Elop, who returned to Microsoft when former CEO Ballmer led the acquisition of Nokia; he had previously worked for Microsoft, leading its massive Office business.
- 25-year Microsoft veteran Eric Rudder, who was acting as advanced strategy chief officer and was a former adviser to founder Bill Gates
- Top advertising guy Mark Penn, the former political adviser who will forever be known as the guy that created the Scroogled ad campaign that bashed Google. Nadella nixed Scroogled almost immediately after becoming CEO.
- 13-year veteran Kirill Tatarinov, who was running Microsoft Business Solutions, notably a product called Dynamics.
A big surprise: the guy who ran Microsoft's answer to Salesforce is gone
MicrosoftKirill Tatarinov, who ran Microsoft DynamicsTatarinov is the biggest surprise.
Dynamics is Microsoft's answer to Salesforce, the fast-growing cloud company that provides online services for sales people, marketers, data analytics, and other functions. Under Tatarinov, Dynamics grew into a nearly $2 billion business.
But Salesforce has been kicking the pants off of Dynamics in recent years. Salesforce CEO Marc Benioff says he's on a fast track to $10 billion in revenue up from a promised $6 billion this year.
Microsoft was reportedly in talks to buy Salesforce, a deal that fizzled when the two couldn't agree on price. Nadella was willing to pay $55 billion and bring Benioff on as a top exec, but, apparently, Benioff kept raising the price, at one point asking $70 billion.
Even with failed merger talks, those two companies have become very chummy. So there are questions about the future of Dynamics. Will Nadella double-down and compete with Salesforce again, or back-off and grow the partnership?
Nadella solidifying his control
For the most part, these changes spell Nadella's rising confidence and power within Microsoft, with Ballmer no longer on the board, and a close friendship with Bill Gates and board chairman John Thompson.
Meanwhile, all three of Nadella's chosen lieutenants have been given more responsibility.
Qi Lu gained the least. He runs application development and has gained responsibility for the Education apps unit. Lu is charged with coming up with the amazing new "productivity" tools that form the basis of Nadella's strategy.
If Microsoft tries to restart talks to buy Salesforce, Guthrie will be in the middle.
However, one man's growth in power has been astronomical: Terry Myerson.
Myerson is now leading a massive new team, the Windows and Devices Group (WDG), meaning he's responsible for the new Windows operating system, and the Microsoft built devices it will run on.
A former Microsoft employee tells us that the scuttlebutt around the company is: "Terry is probably next in line for CEO."
As we previously reported, early in Nadella's reign there was a power struggle of sorts going on between Lu and Myerson over who would control Bing and MSN. Lu is known as a diplomatic guy to work for - a peacemaker. Myerson is brash and forceful. Myerson won the battle.
Myerson is radically changing Windows, turning Windows 10 into a "service" which will automatically be updated and improved. Windows is also now a single operating system that runs across many devices, built by Microsoft or not. That should make Windows developer's happy.
While Myerson's profile is on the rise, so is his risk. Should Windows 10 be another failure for the OS, or should Nokia devices tank, the blame will be easy to place.
All signs so far, however, indicate that Windows 10 will be a hit and Myerson's star will continue to shine.