Tech company executives are some of the most-watched and
most talked about business leaders. It's just more interesting to watch the
career trajectory of someone who wasn’t necessarily groomed from birth to work
a room or lead thousands of employees take the helm at a giant, exciting
company. Whether it’s the obsessive college dropout who built an empire or the
brilliant engineer who joined a future tech powerhouse at the ground floor, we
love to examine the implications of how they build corporate culture and loyal
customers.
Poor Steve Ballmer, Microsoft’s lame duck leader. Ballmer
has been picked apart in the news this week following his retirement
announcement last Friday. As CEO, he had to fill the shoes of the man who
was much more inspiring and appealing —Bill Gates, the
philanthropic nerd hero, the most famous Harvard dropout, and Microsoft’s
founder. For most of the past decade or
so, Ballmer was the much less cooler of the bald guys named Steve heading up
global tech companies.
Ballmer, as a business-minded executive and not a tech-savvy
developer, was biased toward the tried-and-true money-making areas of
Microsoft’s model, such as the Windows platform. He didn’t understand the slow
and expensive road of product development, and it cost Microsoft in influence,
reputation, and revenue and income.
Ballmer was instrumental in slowing down a number of digital
consumer products that could have been huge as soon as he perceived they were
sucking resources away from “sure things,” and Microsoft’s competitors took the
opportunity to jump in front of consumers first.
(As an avid and dedicated Market Street Report reader, you
probably already know where I’m going with this. Obviously I’m building up to
an analogy between Steve Ballmer’s corporate culture and short-sighted
approaches to economic development.)
While Microsoft pioneered tablet and mobile music technology,
they didn’t invest enough in developing these into consumer products to take to
the market. Apple broke out with the iPod and iPad, leaving Microsoft trying to
play catch up later with lackluster devices. When Microsoft launched its Zune
device in 2006, Apple had already sold nearly 100 million iPods. Ballmer
stalled expensive but necessary Xbox product development, starving it out to
feed more profitable business lines, while Sony put in the serious cash for its
PlayStation and game development studios.
Microsoft still dominates the declining PC space, but people
don’t do all their computing on PCs anymore, especially in rapidly expanding
global markets. The one Microsoft product that many consumers have to use—Windows—isn’t compatible
with popular Apple and other non-PC devices and services. Meanwhile, app
developers showed little interest in building apps for Microsoft’s tablet, the
Surface (debuting two years after the iPad). There are many more examples of
the mismatch among Microsoft’s priorities under Ballmer’s leadership and what
consumers really wanted (in many cases before they even knew they wanted it).
In economic development, the community itself is the
product—the quality of life, the skilled and diverse talent, quality of career
and advancement opportunities, the look and feel of the community, and the
relationships between dynamic ecosystems that drive innovation, education, and business.
A weak attempt to develop any one of those assets isn’t going to put you
anywhere near the league of the communities in the enviable position of
balancing quality job growth, skilled worker growth, and investment.
The traditional areas are still very important—established
business sectors, land, site selector relationships, incentives, and taxes. But
the communities that don’t also understand and pay attention to their product
and where they can carve out a new niche using partners and plans are not going
to be able to develop and grow the long-term workforce and assets that are
looking at factors other than cheap land and tax breaks. Perfunctory or
half-hearted downtown development and small-scale and limited
business-education partnerships aren’t going to break your community’s product
ahead of all the other places clamoring for attention.
When he shunned the Xbox risk, the issue wasn’t so much that
Ballmer wasn’t himself a gamer but that he perhaps never tried to grasp the
vision of where the gaming industry was headed and how Microsoft could play a
role in that. In many cases, Microsoft already had the capacity or the
breakthrough that could have given the competition a run for their money—but
they just didn’t recognize, resource, and harness it. What a fine allegory for
community, economic, and workforce development.
