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Nadella leaves no doubt about who is in charge in first six months as CEO

Juan Carlos Perez | Aug. 8, 2014
He's had his share of hits and misses but he's made his presence felt from the start

Coming less than two months after Nadella's appointment, it's obvious the project had been in progress under Ballmer, but many observers assumed that the new CEO made the endeavor a top priority, and they also praised him for whole-heartedly endorsing a cross-platform approach for Microsoft desktop, server and cloud software.

"What motivates us is to make sure that we build the great experiences that span the digital life and digital work of our customers, both individually and as organizations. And that's what you can count on us doing, both with Windows as well as other platforms," Nadella said at an event in San Francisco in late March.

Flying high with cloud products, but open to co-opetition deals
Microsoft tied the Office apps for iPad to a subscription for Office 365, which is one of the products Nadella is most excited about. In his view it exemplifies the future of the company, along with Azure, Microsoft's set of cloud computing offerings.

He's also gung-ho about Dynamics CRM Online, the cloud version of the company's CRM software, but that didn't stop him from brokering an eyebrow-raising partnership with CRM rival Salesforce.com in May.

The deal, which calls for Salesforce.com's CRM software to be integrated with Microsoft's Windows OS, Azure cloud computing platform and Office suite, was needed to respond to the demands of the companies' mutual customers, Nadella said. He added that Microsoft will pursue similar "co-opetition" partnerships intended to make life easier for Microsoft customers.

Under Nadella, Microsoft has also been right smack in the middle of the consumer and enterprise cloud storage arms race, aggressively pushing its OneDrive and OneDrive for Business services against those from Google, Box, Dropbox and other rivals.

Most recently, Nadella made an appearance at the company's big partner event, the Worldwide Partner Conference, held in July. There, he and other top executives urged partners of all stripes to embrace cloud computing, saying Microsoft doesn't have enough partners selling these cloud products.

While that message was all well and good, En Pointe Technologies' Hogan said that Microsoft still needs to further tweak and refine the incentives it gives to resellers of its cloud products, like Office 365 and the Azure services.

Gartner's Adrian said Nadella should do more hand-holding of enterprise customers when it comes to steering them through the transition from on-premises deployments and deals to cloud, subscription-based purchases.

"So far he's been fairly quiet about the shift in how enterprise customers will pay; subscription-based pricing is new and disruptive to Microsoft's relationship with its customers, and licensing shifts will be a challenge for the year ahead as well," he said.

Nadella needs to help enterprise customers navigate these changes patiently, and resist the temptation to rush them based on sales metrics, Adrian added. "That may slow transitions, but retain goodwill and ensure more complete migrations instead of moves to alternatives."

 

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