Management Turnover as Change Agent

Thursday, July 24, 2008

Microsoft's Loses Another Top Executive

As Microsoft's MSFT (NASDAQ) Web plans continue to flounder (Yahoo, search, etc.,) more complications have  appeared.  The primary person behind Microsoft's efforts to acquire Yahoo, Kevin Johnson, The Platforms and Services Division President will be leaving after sixteen years to become Juniper Networks JNPR (NASDAQ) new CEO.  Was he pushed or did he jump?  According to Zachary Rodgers of ClickZ Network,
Johnson may have taken the fall for Microsoft's unsuccessful (to date) exertions to acquire Yahoo. The Wall Street Journal reported late yesterday that CEO Ballmer has grown increasingly frustrated with his own senior executive management's maneuverings throughout the negotiation process, and Kevin Johnson has been fingered as a major shaker in that process.
According to Kara Swisher of the Wall Street Journal's All Things Digital,
As the president of its Platforms and Services Division, the smooth Johnson has been trying, without much success, to beef up the software giant’s efforts in the Web space, especially in the online advertising arena.

He and Microsoft have had a little problem with that, largely due to an immovable object called Google. 

In an attempt to make an end run around the search behemoth, Johnson led Microsoft’s attempt to take over Yahoo, the #2 player in the search and search advertising space.

The six-month effort, according to many sources at Microsoft, has led to a great deal of unrest at the company, including ire aimed directly at Johnson because of his perceived influence on CEO Steve Ballmer.
With Johnson's departure, Steve Ballmer, Microsoft's CEO, announced a new reorganization of the Windows and Online Services Divisions (see press release for details).  The Online Services division will now stand on its own.  According to the release,
Effective immediately, senior vice presidents Steven Sinofsky, Jon DeVaan and Bill Veghte will report directly to Ballmer to lead Windows/Windows Live...

In the Online Services Business, Microsoft will create a new senior lead position and will conduct a search ... In the meantime, Senior Vice President Satya Nadella will continue to lead Microsoft’s search, MSN and ad platform engineering efforts...

In addition, Senior Vice President Brian McAndrews will continue to lead the Advertiser & Publisher Solutions Group (APS)...  McAndrews will continue to focus on the display advertising opportunity for Microsoft, driving execution and integration of advertising assets, including recent acquisitions such as Massive Inc., Navic Networks, ScreenTonic SA and YaData Ltd.
Microsoft has been looking rather anemic of late.  We will just have to see how this all plays out.  Speculation is already beginning to appear as to who will replace Johnson at Microsoft.  Kevin Liu of Reuters wrote piece in which Jon Miller, the former AOL executive and a possible Icahn candidate to replace Jerry Yang at Yahoo should he ultimately prevail, might be considered for Johnson's former job.  Whatever the choice for now, Google must be singing a happy tune. 

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