Microsoft (NASDAQ:MSFT) is preparing for a big culture change in the workings of the company. Company chief executive Satya Nadella is all out to change the face of the Redmond giant and has undertaken effective steps to “visibly” modify the culture. The company’s work environment has portrayed tough surrounding with internal strife, disintegration among workforce, and tremendous work place politics.
Bringing a Change
Identifying the internal disagreement, before his retirement and handing over reign to Nadella, Steve Ballmer presented the proposal of putting in effort to amend the working culture of the company and bring it to what he referred to as “One Microsoft”.
On Thursday, in a letter to the company’s employees, Nadella noted that he is striving to bring about cultural modifications. However, it isn’t clear if he is trying to follow the footsteps of his predecessor and build the One Microsoft culture, or has something else in mind. Substantial part of the letter expressed the company’s keen interest in developing in the cloud and mobile space. The gaming console faces stiff competition from PlayStation 4 that’s eating into its sales. And though quite a few investors have shown their dissatisfaction with the videogame business, Nadella remains committed to Xbox.
- Warning! GuruFocus has detected 7 Warning Signs with MSFT. Click here to check it out.
- MSFT 15-Year Financial Data
- The intrinsic value of MSFT
- Peter Lynch Chart of MSFT
Nadella’s vision isn’t vague. The leader has given clarity as to what minute improvements he is looking for. He aspires to make the tech giant the best place to work at, building “smart, curious, ambitious people.” This would benefit the company in a big way and help it achieve its target in a more organized manner. The change would also enhance Microsoft’s competitive edge. At this point of time, when fellow players Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), and Samsung (SSNLF) are driving towards innovative offerings and enhancing consumer experience, it becomes mandatory for Microsoft to upgrade its products to be in the game.
From strategic point of view, there would be mergers and acquisitions in the future, effective collaborations and alliances. Job accountability would change, new hiring would be done, different skill sets would be developed, several adjustments would be performed, fresh ideas would be promoted, work flow would be streamlined, and numerous other things would be done to provide a complete makeover to the organization.
Nadella says that Microsoft will re-engineer the process to suit the customer needs at best, make the progression more data oriented, and uplift the quality of the offerings by increasing efficiency to improve customer satisfaction. The idea is to minimize the input and maximize the output, which has been very simply explained by the company’s boss -- “reduce the amount of time and energy it takes to get things done.” Instead of involving several heads in taking decisions, fewer people would be involved in doing so to minimize confusion and save time. On the other hand, accountability of individuals will rise.
The company also plans to increase training and development activities for its employees. This would help the tech giant to take up fresh projects and provide better insight. Nadella also wishes to make processes much leaner and “flatten the organization” for easy and faster flow of information.
The Bottom line
While all this looks pretty good and exciting for Microsoft’s future, it’s easier said than done. The main challenge lies in implementing the plan that’s laid down. Changing a company from the core is a hard task, but if Nadella manages to attain even a part of his vision, it would bring a whole lot of improvement in the company, together with boosting top and bottom lines.