Steve Ballmer’s last letter highlights some ‘bold’ decisions

by Shweta Verma    Oct 09, 2013

steve ballmer

“Fiscal Year 2013 was a pivotal year for Microsoft in every sense of the word,” says Steve Ballmer in the final letter he wrote last week as the CEO of Microsoft. “Last year in my letter to you I declared a fundamental shift in our business to a devices and services company. This transformation impacts how we run the company, how we develop new experiences, and how we take products to market for both consumers and businesses. This past year we took the first big bold steps forward in our transformation…”

The letter which is addressed to all Microsoft shareholders, customers, partners and employees, highlights some key transformation initiatives that Microsoft has undertaken in the previous year and the challenges that lie ahead for the company. “We are still in the early days of our transformation, yet we made strong progress in the past year launching devices and services that people love and businesses need,” writes Ballmer.

Elaborating on Microsoft’s new strategy to focus on devices and services, he explained how the new strategy can help create new areas of growth for the company. “As we go to market, we will primarily monetize our high-value activities by leading with devices and enterprise services… Enterprise services continue to be an area of great strength, growth and opportunity as businesses of all sizes look to Microsoft to help them move to the cloud, manage a growing number of devices, tap into big data and embrace new social capabilities,” he says.

In order to execute its transformation strategy, Microsoft had to take some ‘bold’ decisions, said Ballmer. The entire organization structure has been revamped to make it more effective in meeting the company’s new strategy and shared goals. Instead of organizing teams around individual products, they have been organized by function, including, for example, engineering, sales, marketing and finance.

The other ‘big’ step was to acquire Nokia’s Devices and Services business as this would be instrumental in executing the company’s mobile strategy. “This is a signature event in our transformation and will bring together the best mobile device work of Microsoft and Nokia. It will accelerate our growth with Windows Phone while strengthening our overall device ecosystem and our opportunity,” he writes.

In September, the company also announced a new segment-reporting framework to focus better on delivering innovative devices and services for both enterprise and consumer customers.

Expressing his optimism about the ‘bold’ decisions taken by the company this year, Ballmer says, “With the decisions we’ve made this year, the strategy we’ve put in place, the organization we’ve designed, the world-class talent we have, and the devices and services we are creating, we are well-positioned to deliver growth and world-changing technology long into the future.”